The admissibility test, as prescribed by the Statement of Statutory Accounting Principles (SSAP) No. 101, is the procedure used to determine the amount of deferred tax assets (DTAs) that can be recognized on an insurer's statutory financial statements. This test is explicitly applied to the Gross DTA. The Gross DTA represents the total deferred tax assets before any offsetting with deferred tax liabilities (DTLs) and before applying any limitations on admissibility. The test then establishes the maximum portion of this gross figure that is deemed realizable and can be admitted as an asset.

A. Maximum DTA: This is not a formal term used in SSAP No. 101. While the test determines the maximum amount of DTA that can be admitted, "Maximum DTA" is not the name of the component being tested.

B. Minimum DTA: This is conceptually incorrect. The admissibility test establishes a ceiling or a maximum limit on the recognizable asset, not a floor or a minimum.

C. Net DTA: While the calculation of Net DTA (Gross DTA minus Gross DTL) is a step in the overall income tax accounting process, the admissibility test itself is fundamentally applied to the Gross DTA figure.

1. National Association of Insurance Commissioners (NAIC). Accounting Practices and Procedures Manual. Vol. III, Statement of Statutory Accounting Principles No. 101—Income Taxes, Paragraph 10.

Quote: "An admissibility test shall be applied to the gross DTAs... The amount of DTA that is admitted shall be the amount that is expected to be realized... Realization is dependent on the existence of sufficient taxable income of the appropriate character within the carryback or carryforward periods." This directly states that the test is applied to the Gross DTAs.

2. Society of Actuaries (SOA). Exam 7 Study Note: Introduction to Statutory Financial Reporting in the United States. Spring 2021, Section 3.3.2, p. 11.

Reference: This educational material from a professional actuarial body explains the SSAP 101 admissibility test, stating, "The amount of gross DTA that can be admitted as an asset is limited based on a three-tiered test." This confirms that the Gross DTA is the subject of the limitation test.