with generally accepted accounting principles and not as a current asset and the footnotes to the taxpayer’s financial statements include a short description of the fund and its purposes. (8) Insurance The taxpayer property insurance maintained by the qualified taxpayer applies to 75 percent or more of the property used— (A) in the qualified taxpayer’s line of business to which the fund relates, and (B) in the United States. (c) Qualified taxpayer For purposes of this section, the term qualified taxpayer means any taxpayer that— (1) actively conducts a trade or business, and (2) maintains property insurance with respect to such trade or business that insures against losses in natural disasters. (d) Failure To meet requirements If a fund that was a natural disaster fund ceases to meet any of the requirements of subsection (b) or a taxpayer who has a natural disaster fund ceases to meet the requirement of subsection (c), the entire balance of the fund shall be deemed distributed in a nonqualified distribution at the time the fund ceases to meet such requirements. (e) Taxation of fund (1) In general The earnings (including gains and losses) from the investment and reinvestment of amounts held in the fund shall not be taken into account in determining the gross income of the taxpayer that owns the fund. (2) Not a separate taxpayer A natural disaster fund shall not be considered a separate taxpayer for purposes of this subtitle. (f) Taxation of distributions from the fund (1) Qualified distributions For purposes of this chapter, qualified distributions shall be treated in the same manner as proceeds from property or business interruption insurance. (2) Nonqualified distributions (A) In general In the case of any taxable year for which there is a nonqualified distribution— (i) such nonqualified distributions shall be excluded from the gross income of the taxpayer, and (ii) the tax imposed by this chapter (determined without regard to this subsection) shall be increased by the product of the amount of such nonqualified