State of Illinois
92nd General Assembly
Legislation

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[ Introduced ][ House Amendment 001 ]


92_SB1126eng

 
SB1126 Engrossed                               LRB9208175JSpc

 1        AN ACT concerning insurance.

 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 Section 412 as follows:

 6        (215 ILCS 5/412) (from Ch. 73, par. 1024)
 7        Sec. 412. Refunds; penalties; collection.
 8        (1) (a)  Whenever it appears to the satisfaction  of  the
 9    Director  that  because  of  some  mistake  of fact, error in
10    calculation, or erroneous interpretation of a statute of this
11    or any other state, any authorized company has paid  to  him,
12    pursuant  to  any  provision  of  law,  taxes, fees, or other
13    charges in excess of the amount  legally  chargeable  against
14    it,  during  the  6  year  period  immediately  preceding the
15    discovery of such overpayment, he shall have power to  refund
16    to  such  company  the  amount  of  the excess or excesses by
17    applying the amount or amounts thereof toward the payment  of
18    taxes,  fees,  or  other  charges  already  due, or which may
19    thereafter become due from that company until such excess  or
20    excesses  have been fully refunded, or upon a written request
21    from the authorized company, the  Director  shall  provide  a
22    cash  refund  within  120  days  after receipt of the written
23    request if all necessary information has been filed with  the
24    Department  in order for it to perform an audit of the annual
25    return for the year in  which  the  overpayment  occurred  or
26    within  120  days  after the date the Department receives all
27    the  necessary  information  to  perform  such  audit.    The
28    Director  shall  not  provide  a  cash  refund  if  there are
29    insufficient funds in the Insurance Premium Tax  Refund  Fund
30    to provide a cash refund, if the amount of the overpayment is
31    less  than  $100,  or if the amount of the overpayment can be
 
SB1126 Engrossed            -2-                LRB9208175JSpc
 1    fully offset against the taxpayer's estimated  liability  for
 2    the  year following the year of the cash refund request.  Any
 3    cash refund shall be paid  from  the  Insurance  Premium  Tax
 4    Refund  Fund,  a  special  fund  hereby  created in the State
 5    treasury.
 6        (b)  Beginning  January  1,  2000  and  thereafter,   the
 7    Department   shall   deposit  a  percentage  of  the  amounts
 8    collected under Sections 409, 444, and  444.1  of  this  Code
 9    into  the  Insurance Premium Tax Refund Fund.  The percentage
10    deposited into the Insurance Premium Tax Refund Fund shall be
11    the  annual  percentage.   The  annual  percentage  shall  be
12    calculated as a fraction, the numerator of which shall be the
13    amount of cash refunds approved by the Director  for  payment
14    and  paid  during  the preceding calendar year as a result of
15    overpayment of tax liability under  Sections  409,  444,  and
16    444.1  of this Code and the denominator of which shall be the
17    amounts collected pursuant to Sections 409, 444, and 444.1 of
18    this Code during the preceding calendar  year.   However,  if
19    there were no cash refunds paid in a preceding calendar year,
20    the  Department  shall  deposit 5% of the amount collected in
21    that preceding calendar year pursuant to Sections  409,  444,
22    and  444.1 of this Code into the Insurance Premium Tax Refund
23    Fund instead of an amount  calculated  by  using  the  annual
24    percentage.
25        (c)  Beginning  July  1,  1999,  moneys  in the Insurance
26    Premium Tax Refund Fund shall be expended exclusively for the
27    purpose of paying cash refunds resulting from overpayment  of
28    tax liability under Sections 409, 444, and 444.1 of this Code
29    as  determined by the Director pursuant to subsection 1(a) of
30    this Section.  Cash refunds  made  in  accordance  with  this
31    Section  may  be  made  from the Insurance Premium Tax Refund
32    Fund only to the extent that amounts have been deposited  and
33    retained in the Insurance Premium Tax Refund Fund.
34        (d)  This  Section  shall  constitute  an irrevocable and
 
SB1126 Engrossed            -3-                LRB9208175JSpc
 1    continuing  appropriation  from  the  Insurance  Premium  Tax
 2    Refund Fund for the purpose of paying cash  refunds  pursuant
 3    to the provisions of this Section.
 4        (2)  When  any  insurance  company  or  any  surplus line
 5    producer fails to file any tax return required under Sections
 6    408.1, 409, 444, 444.1 and 445 of this Code or Section 12  of
 7    the Fire Investigation Act  on the date prescribed, including
 8    any  extensions, there shall be added as a penalty $200 or 5%
 9    of the amount of such tax, whichever  is  greater,  for  each
10    month  or  part  of  a  month  of failure to file, the entire
11    penalty not to exceed $1,000 or 25% of the tax due, whichever
12    is greater.
13        (3) (a)  When any insurance company or any  surplus  line
14    producer   fails  to  pay  the  full  amount  due  under  the
15    provisions of this Section, Sections 408.1, 409,  444,  444.1
16    or  445 of this Code, or Section 12 of the Fire Investigation
17    Act, there shall be added to the amount due as a  penalty  an
18    amount equal to 5% of the deficiency.
19        (b)  If such failure to pay is determined by the Director
20    to  be  wilful,  after  a hearing under Sections 402 and 403,
21    there shall be added to the tax as a penalty an amount  equal
22    to  the  greater of 25% of the deficiency or 5% of the amount
23    due and unpaid for each month or part of  a  month  that  the
24    deficiency  remains  unpaid commencing with the date that the
25    amount becomes due. Such amount  shall  be  in  lieu  of  any
26    determined under paragraph (a).
27        (4)  Any  insurance  company or any surplus line producer
28    which fails to pay the full amount due under this Section  or
29    Sections  408.1,  409,  444,  444.1  or  445 of this Code, or
30    Section 12 of the  Fire  Investigation  Act   is  liable,  in
31    addition  to  the tax and any penalties, for interest on such
32    deficiency at the rate of 12% per annum, or  at  such  higher
33    adjusted  rates as are or may be established under subsection
34    (b) of Section 6621 of the Internal Revenue  Code,  from  the
 
SB1126 Engrossed            -4-                LRB9208175JSpc
 1    date that payment of any such tax was due, determined without
 2    regard  to  any  extensions,  to  the date of payment of such
 3    amount.
 4        (5)  The Director,  through  the  Attorney  General,  may
 5    institute an action in the name of the People of the State of
 6    Illinois,  in  any  court  of competent jurisdiction, for the
 7    recovery of the amount of such  taxes,  fees,  and  penalties
 8    due,  and prosecute the same to final judgment, and take such
 9    steps as are necessary to collect the same.
10        (6)  In the event that the certificate of authority of  a
11    foreign  or  alien  company  is  revoked for any cause or the
12    company withdraws from this State prior to the  renewal  date
13    of  the  certificate of authority as provided in Section 114,
14    the company may recover the amount of any such  tax  paid  in
15    advance. Except as provided in this subsection, no revocation
16    or  withdrawal  excuses payment of or constitutes grounds for
17    the recovery of any taxes or penalties imposed by this Code.
18        (7)  When an insurance  company  or  domestic  affiliated
19    group fails to pay the full amount of any fee of $250 $100 or
20    more due under Section 408 of this Code, there shall be added
21    to  the  amount  due  as  a  penalty the greater of $50 or an
22    amount equal to 5% of the deficiency for each month  or  part
23    of a month that the deficiency remains unpaid.
24    (Source: P.A. 91-643, eff. 8-20-99.)

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