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Federal Income Taxes
6 Months Ended
Jun. 30, 2021
Federal Income Taxes [Abstract]  
Federal Income Taxes

6. Federal Income Taxes

The effective tax rate is the ratio of tax expense (benefit) over pre-tax income (loss). The effective tax rate was 17% and 16% for the three and six months ended June 30, 2021, respectively, compared to 42% and 67%, respectively, for the corresponding periods in 2020. The effective tax rate on pre-tax income is typically lower than the prevailing corporate federal income tax rate of 21% due to benefits from preferential tax items including the separate accounts dividends-received deduction and tax credits.

For the three and six months ended June 30, 2020, the effective tax rate differed from the prevailing corporate federal income tax rate of 21% primarily due to a tax benefit at 21% from pre-tax losses in addition to the effects of preferential tax items.