Full Text of SB3366 98th General Assembly
SB3366enr 98TH GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning regulation.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Illinois Insurance Code is amended by | 5 | | changing Sections 409 and 444 as follows:
| 6 | | (215 ILCS 5/409) (from Ch. 73, par. 1021)
| 7 | | Sec. 409. Annual privilege tax payable by
companies. | 8 | | (1) As of January 1, 1999 for all health maintenance | 9 | | organization premiums
written; as of July 1, 1998 for all | 10 | | premiums written as accident and health
business, voluntary | 11 | | health service plan business, dental service plan business,
or | 12 | | limited health service organization business; and as of January | 13 | | 1, 1998
for all other types of insurance premiums written, | 14 | | every company doing any form
of insurance business in this
| 15 | | State, including, but not limited to, every risk retention | 16 | | group, and excluding
all fraternal benefit societies, all farm | 17 | | mutual companies, all religious
charitable risk pooling | 18 | | trusts, and excluding all statutory residual market and
special | 19 | | purpose entities in which companies are statutorily required to
| 20 | | participate, whether incorporated or otherwise, shall pay, for | 21 | | the privilege of
doing business in this State, to the Director | 22 | | for the State treasury a State
tax equal to 0.5% of the net | 23 | | taxable premium written, together with any amounts
due under |
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| 1 | | Section 444 of this Code, except that the tax to be paid on any
| 2 | | premium derived from any accident and health insurance or on | 3 | | any insurance
business written by any company operating as a | 4 | | health maintenance organization,
voluntary health service | 5 | | plan, dental service plan, or limited health service
| 6 | | organization shall be equal to 0.4% of such net taxable premium | 7 | | written,
together with any amounts due under Section 444. Upon | 8 | | the failure of any
company to pay any such tax due, the | 9 | | Director may, by order, revoke or
suspend the company's | 10 | | certificate of authority after giving 20 days written
notice to | 11 | | the company, or commence proceedings for the suspension of | 12 | | business
in this State under the procedures set forth by | 13 | | Section 401.1 of this Code.
The gross taxable premium written | 14 | | shall be the gross amount of premiums
received on direct | 15 | | business during the calendar year on contracts covering
risks | 16 | | in this State, except premiums on annuities, premiums on which | 17 | | State
premium taxes are prohibited by federal law, premiums | 18 | | paid by the State for
health care coverage for Medicaid | 19 | | eligible insureds as described in Section
5-2 of the Illinois | 20 | | Public Aid Code, premiums paid for health care services
| 21 | | included as an element of tuition charges at any university or | 22 | | college owned
and operated by the State of Illinois, premiums | 23 | | on group insurance contracts
under the State Employees Group | 24 | | Insurance Act of 1971, and except premiums for
deferred | 25 | | compensation plans for employees of the State, units of local
| 26 | | government, or school districts. The net taxable premium shall |
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| 1 | | be the gross
taxable premium written reduced only by the | 2 | | following:
| 3 | | (a) the amount of premiums returned thereon which shall | 4 | | be limited to
premiums returned during the same preceding | 5 | | calendar year and shall not include
the return of cash | 6 | | surrender values or death benefits on life policies
| 7 | | including annuities;
| 8 | | (b) dividends on such direct business that have been | 9 | | paid in cash, applied
in reduction of premiums or left to | 10 | | accumulate to the credit of policyholders
or annuitants. In | 11 | | the case of life insurance, no deduction shall be made for
| 12 | | the payment of deferred dividends paid in cash to | 13 | | policyholders on maturing
policies; dividends left to | 14 | | accumulate to the credit of policyholders or
annuitants | 15 | | shall be included as gross taxable premium written when | 16 | | such
dividend
accumulations are applied to purchase | 17 | | paid-up insurance or to shorten the
endowment or premium | 18 | | paying period.
| 19 | | (2) The annual privilege tax payment due from a company | 20 | | under subsection (4)
of
this Section may be reduced by: (a) the | 21 | | excess amount, if any, by which the
aggregate income taxes paid | 22 | | by the company, on a cash basis, for the preceding
calendar | 23 | | year under Sections 601 and 803 subsections (a) through (d) of | 24 | | Section 201 of the Illinois
Income Tax Act exceed 1.5% of the | 25 | | company's net taxable premium written for
that prior calendar | 26 | | year, as determined under subsection (1) of this Section;
and |
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| 1 | | (b) the amount of any fire department taxes paid by the company | 2 | | during the
preceding calendar year under Section 11-10-1 of the | 3 | | Illinois Municipal Code.
Any deductible amount or offset | 4 | | allowed under items (a) and (b) of this
subsection for any | 5 | | calendar year will not be allowed as a deduction or offset
| 6 | | against the company's privilege tax liability for any other | 7 | | taxing period or
calendar year.
| 8 | | (3) If a company survives or was formed by a merger, | 9 | | consolidation,
reorganization, or reincorporation, the | 10 | | premiums received and amounts returned
or paid by all companies | 11 | | party to the merger, consolidation, reorganization,
or | 12 | | reincorporation shall, for purposes of determining the amount | 13 | | of the tax
imposed by this Section, be regarded as received, | 14 | | returned, or paid by the
surviving
or new company.
| 15 | | (4)(a) All companies subject to the provisions of this | 16 | | Section shall make an
annual return for the preceding calendar | 17 | | year on or before March 15 setting
forth such information on | 18 | | such forms as the Director may reasonably require.
Payments of | 19 | | quarterly installments of the taxpayer's total estimated tax | 20 | | for
the current calendar year shall be due on or before April | 21 | | 15, June 15,
September 15, and December 15 of such year, except | 22 | | that all companies
transacting insurance in this State whose | 23 | | annual tax for the immediately
preceding calendar year was less | 24 | | than $5,000 shall make only an annual return.
Failure of a | 25 | | company to make the annual payment, or to make the quarterly
| 26 | | payments, if required, of at least 25% of either (i) the total |
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| 1 | | tax paid during
the
previous calendar year or (ii) 80% of the | 2 | | actual tax for the current calendar
year shall subject it to | 3 | | the penalty provisions set forth in Section 412 of
this Code.
| 4 | | (b) Notwithstanding the foregoing provisions, no annual | 5 | | return shall be
required or made on March 15, 1998, under this | 6 | | subsection. For the calendar
year 1998:
| 7 | | (i) each health maintenance organization shall have no | 8 | | estimated tax
installments;
| 9 | | (ii) all companies subject to the tax as of July 1, | 10 | | 1998 as
set forth in subsection (1) shall have estimated | 11 | | tax installments due on
September
15 and December 15 of | 12 | | 1998 which
installments shall each amount to no less than | 13 | | one-half of 80% of the actual
tax on its net taxable | 14 | | premium written during the period July 1, 1998, through
| 15 | | December 31, 1998; and
| 16 | | (iii) all other companies shall have estimated tax | 17 | | installments due on
June
15, September 15, and December 15 | 18 | | of 1998 which installments shall each
amount to no less | 19 | | than one-third of 80% of the actual tax on its net taxable
| 20 | | premium written during the calendar year 1998.
| 21 | | In the year 1999 and thereafter all companies shall make | 22 | | annual and
quarterly installments of their estimated tax as | 23 | | provided by paragraph (a) of
this subsection.
| 24 | | (5) In addition to the authority specifically granted under | 25 | | Article XXV of
this Code, the Director shall have such | 26 | | authority to adopt rules and establish
forms as may be |
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| 1 | | reasonably necessary
for purposes of determining the | 2 | | allocation of Illinois corporate income taxes
paid under | 3 | | subsections (a) through (d) of Section 201 of the Illinois | 4 | | Income
Tax Act amongst members of a business group that files | 5 | | an Illinois corporate
income tax return on a unitary basis, for | 6 | | purposes of regulating the amendment
of tax returns, for | 7 | | purposes of defining terms, and for purposes of enforcing
the | 8 | | provisions of
Article XXV of
this Code. The Director shall also | 9 | | have authority to defer, waive, or abate
the tax
imposed by | 10 | | this Section if in his opinion the company's solvency and | 11 | | ability to
meet its insured obligations would be immediately | 12 | | threatened by payment of the
tax due.
| 13 | | (6) This Section is subject to the provisions of Section 10 | 14 | | of the New Markets Development Program Act. | 15 | | (Source: P.A. 97-813, eff. 7-13-12.)
| 16 | | (215 ILCS 5/444) (from Ch. 73, par. 1056)
| 17 | | Sec. 444. Retaliation.
| 18 | | (1) Whenever the existing or future laws of any other state | 19 | | or country
shall
require of companies incorporated or organized | 20 | | under the laws of this State
as a condition precedent to their | 21 | | doing business in such other state or
country, compliance with | 22 | | laws, rules, regulations, and prohibitions more
onerous or | 23 | | burdensome than the rules and regulations imposed by this State
| 24 | | on foreign or alien companies, or shall require any deposit of | 25 | | securities
or other obligations in such state or country, for |
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| 1 | | the protection of
policyholders or otherwise or require of such | 2 | | companies or agents thereof
or brokers the payment of | 3 | | penalties, fees, charges, or taxes greater than
the penalties, | 4 | | fees, charges, or taxes required in the aggregate for like
| 5 | | purposes by this Code or any other law of this State, of | 6 | | foreign or alien
companies, agents thereof or brokers, then | 7 | | such laws, rules, regulations,
and prohibitions of said other | 8 | | state or country shall apply to companies
incorporated or | 9 | | organized under the laws of such state or country doing
| 10 | | business in this State, and all such companies, agents thereof, | 11 | | or brokers
doing business in this State, shall be required to | 12 | | make deposits, pay
penalties, fees, charges, and taxes, in | 13 | | amounts equal to those required in
the aggregate for like | 14 | | purposes of Illinois companies doing business in
such state or | 15 | | country, agents thereof or brokers. Whenever any other state
or | 16 | | country shall refuse to permit any insurance company | 17 | | incorporated or
organized under the laws of this State to | 18 | | transact business according to
its usual plan in such other | 19 | | state or country, the director may, if
satisfied that such | 20 | | company of this State is solvent, properly managed, and
can | 21 | | operate legally under the laws of such other state or country,
| 22 | | forthwith suspend or cancel the license of every insurance | 23 | | company doing
business in this State which is incorporated or | 24 | | organized under the laws of
such other state or country to the | 25 | | extent that it insures in this State
against any of the risks | 26 | | or hazards which are sought to be insured against
by the |
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| 1 | | company of this State in such other state or country.
| 2 | | (2) The provisions of this Section shall not apply to | 3 | | residual market
or special purpose assessments or guaranty fund | 4 | | or guaranty association
assessments, both under the laws of | 5 | | this State and under the laws of any other
state
or country, | 6 | | and any tax offset or credit for any such assessment shall, for
| 7 | | purposes of this Section, be treated as a tax paid both under | 8 | | the laws of this
State and under the laws of any other state or | 9 | | country.
| 10 | | (3) The terms "penalties", "fees", "charges", and "taxes" | 11 | | in subsection
(1) of this
Section
shall include: the penalties, | 12 | | fees, charges, and taxes collected on a cash basis under State
| 13 | | law
and
referenced within Article XXV exclusive of any items | 14 | | referenced by
subsection
(2) of this Section, but including any | 15 | | tax offset allowed under Section 531.13
of this Code; the | 16 | | aggregate Illinois corporate income taxes paid imposed under | 17 | | Sections 601 and 803
subsections (a) through (d) of Section 201 | 18 | | of the Illinois Income Tax Act during the calendar year for | 19 | | which the retaliatory tax calculation is being made, less the | 20 | | recapture of any Illinois corporate income tax cash refunds to | 21 | | the extent that the amount of tax refunded was reported as part | 22 | | of the Illinois basis in the calculation of the retaliatory tax | 23 | | for a prior tax year, provided that such recaptured refund | 24 | | shall not exceed the amount necessary for equivalence of the | 25 | | Illinois basis with the state of incorporation basis in such | 26 | | tax year, and after
any tax offset allowed under Section 531.13 |
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| 1 | | of this Code;
income or personal property taxes imposed by | 2 | | other states or countries;
penalties, fees, charges, and taxes | 3 | | of other states
or countries imposed for purposes like those of | 4 | | the penalties, fees, charges,
and taxes
specified in Article | 5 | | XXV of this Code exclusive of any item referenced in
subsection | 6 | | (2) of this Section; and any penalties, fees, charges, and | 7 | | taxes
required as
a
franchise, privilege, or licensing tax for
| 8 | | conducting the business of insurance whether calculated as a | 9 | | percentage of
income, gross receipts, premium, or otherwise.
| 10 | | (4) Nothing contained in this Section or Section 409 or | 11 | | Section 444.1 is
intended to authorize or expand any power of | 12 | | local governmental units or
municipalities to impose taxes, | 13 | | fees, or charges.
| 14 | | (5) This Section is subject to the provisions of Section 10 | 15 | | of the New Markets Development Program Act. | 16 | | (Source: P.A. 95-1024, eff. 12-31-08.)
| 17 | | Section 99. Effective date. This Act takes effect upon | 18 | | becoming law.
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