CHAPTER 207*

INSURANCE COMPANIES AND HEALTH CARE CENTERS TAXES

*See Chapter 138c re tax credits for donations to Rental Housing Assistance Trust Fund.

See Sec. 10-228b re tax credits for donations of computers to boards of education and public schools.

See Secs. 10-416, 10-416a re tax credits for rehabilitation of historic homes and certified historic structures.

See Sec. 12-217t re tax credits for personal property taxes paid on electronic data processing equipment.

See Sec. 12-217hh re tax credits for hiring of displaced workers.

See Sec. 12-217ii re jobs creation tax credit.

See Sec. 38a-91nn re captive insurance company premium receipts tax.

Table of Contents

Sec. 12-201. Definitions.

Sec. 12-201a. Definitions.

Sec. 12-202. Tax on net direct premiums of domestic insurance companies.

Sec. 12-202a. Tax on net direct subscriber charges of health care centers. Exceptions.

Sec. 12-202b. Tax credit for providers of HUSKY coverage.

Sec. 12-202c. Supplemental payments to providers of HUSKY coverage.

Sec. 12-203. Tax on receipts of interest and dividends by domestic companies.

Sec. 12-204. Assessment and collection of taxes.

Secs. 12-204a and 12-204b. Declaration of estimated tax. Installment payments.

Sec. 12-204c. Installment payments. Interest on unpaid installments.

Sec. 12-204d. Payment and disposition of installments.

Sec. 12-204e. Liability of fiduciary conducting or liquidating business.

Sec. 12-204f. Overpayments. Regulations.

Sec. 12-204g. Regulations.

Sec. 12-205. Annual return. Extensions.

Sec. 12-206. Penalties for late filing and wilful submission of fraudulent return or document.

Sec. 12-207. Oaths and subpoenas.

Sec. 12-208. Application for administrative hearing and appeal therefrom to Superior Court.

Sec. 12-209. Tax to be in lieu of certain other taxes.

Sec. 12-210. Tax on net direct premiums of nonresident and foreign companies.

Sec. 12-210a. Deduction by nonresident companies of benefit payments from group health insurance premiums.

Sec. 12-211. Reciprocity.

Sec. 12-211a. Limit on credits under this chapter. Exceptions.

Sec. 12-212. Provisions of the tax on domestic companies pertaining to filing returns, collection of taxes and penalties made applicable to foreign companies.

Sec. 12-212a. Annual state charge applicable to hospital and medical service corporations. Such corporations not subject to tax under this chapter.

Secs. 12-212b and 12-212c. Employee welfare benefit plans; definitions. Imposition of tax.


Sec. 12-201. Definitions. When used in this chapter, unless the context otherwise requires:

(1) “Commissioner of Revenue Services” or “commissioner” means the Commissioner of Revenue Services;

(2) “Insurance Commissioner” means the state Insurance Commissioner;

(3) “Taxpayer” means any insurance company subject to taxation under this chapter;

(4) “Insurance company” means any corporation, limited liability company, association, partnership or combination of persons doing any kind or form of insurance business other than a fraternal benefit society, including a receiver, trustee or other fiduciary of any insurance company when the context reasonably permits;

(5) “Domestic insurance company” means any insurance company chartered by or organized or constituted within or under the laws of this state;

(6) “Local domestic insurance company” means any domestic insurance company more than fifty per cent of the total gross direct premiums of which are received during the calendar year next preceding for insurance on property or risks located or resident in this state;

(7) “Gross direct premiums” means all receipts of premiums from policyholders and applicants for policies, whether received in the form of money or other valuable consideration, but excluding annuity premiums and considerations and premiums received for reinsurances assumed from other insurance companies and premiums received after July 1, 1990, and before January 1, 1995, for any special health care plan, as defined in section 38a-564;

(8) “Net direct premiums” means gross direct premiums less the following items: (A) Returned premiums, including cancellations, and (B) dividends paid to policyholders on direct business, not including any dividends paid on account of the ownership of stock;

(9) “Direct subscriber charges” means all charges made by a health care center, as defined in section 38a-175, to subscribers, as defined in section 38a-175, by whomever paid;

(10) “Net direct subscriber charges” means direct subscriber charges less returned charges, including cancellations;

(11) “Received” means “received” or “accrued”, construed according to the method of accounting customarily employed by the taxpayers;

(12) “Domestic insurance holding company” means any company engaged principally in the business of holding the stocks of domestic insurance companies, whether or not such holding company is chartered in this state;

(13) “Life insurance department” or “life insurance company” means any department or company engaged in writing policies or annuities the premiums on which are charged wholly or chiefly on the basis of tables purporting to represent the mortality of insured lives or of annuitants;

(14) “State” means any state, territory or district of the United States; and

(15) “Ocean marine insurance” means all insurance written within this state upon hulls, freights or disbursements, or upon goods, wares, merchandise and all other personal property and interests therein, in course of exportation from or importation into any country or transportation coastwise, including transportation by land or water from point of origin to final destination, in respect to any and all risks or perils of navigation, transit or transportation, and while being prepared for and awaiting shipment, and during any delays, storage, transshipment or reshipment incident thereto, including war risks and marine builder’s risks.

(1949 Rev., S. 1883; P.A. 73-350, S. 1, 27; P.A. 77-614, S. 139, 163, 610; P.A. 80-482, S. 15, 348; P.A. 90-134, S. 14, 28; P.A. 95-79, S. 26, 189; P.A. 97-243, S. 7, 67.)

History: P.A. 73-350 deleted definitions of “gross direct annuity considerations” and “net direct annuity considerations”, included annuity premiums and considerations received for reinsurances in definition of “gross direct premiums” and defined “local domestic insurance company”; P.A. 77-614 substituted commissioner of revenue services for tax commissioner, placed insurance commissioner in department of business regulation and made insurance department a division within the department of business regulation, effective January 1, 1979; P.A. 80-482 removed reference to abolished department of business regulation; P.A. 90-134 redefined “gross direct premiums” to specifically exclude premiums received for special health care plans; P.A. 95-79 redefined “insurance company” to include a limited liability company, effective May 31, 1995; P.A. 97-243 added definitions of “direct subscriber charges” and “net direct subscriber charges” and numbered definitions, effective June 24, 1997, and applicable to calendar years commencing on or after January 1, 1997.

Sec. 12-201a. Definitions. Section 12-201a is repealed, effective July 1, 1995, and applicable to estimated corporation business taxes for income years commencing on or after January 1, 1996.

(June, 1969, P.A. 1, S. 1; P.A. 89-16, S. 8, 31; P.A. 90-28, S. 5; 90-196, S. 1, 5; P.A. 95-327, S. 9, 10.)

Sec. 12-202. Tax on net direct premiums of domestic insurance companies. Each domestic insurance company shall, annually, pay a tax on the total net direct premiums received by such company during the calendar year next preceding from policies written on property or risks located or resident in this state. The rate of tax on all net direct insurance premiums received on and after January 1, 1995, shall be one and three-quarters per cent. The franchise tax imposed under this section on premium income for the privilege of doing business in the state is in addition to the tax imposed under chapter 208. In the case of any local domestic insurance company the admitted assets of which as of the end of an income year do not exceed ninety-five million dollars, eighty per cent of the tax paid by such company under chapter 208 during such income year reduced by any refunds of taxes paid by such company and granted under said chapter within such income year and eighty per cent of the assessment paid by such company under section 38a-48 during such income year shall be allowed as a credit in the determination of the tax under this chapter payable with respect to total net direct premiums received during such income year, provided that these two credits shall not reduce the tax under this chapter to less than zero, and provided further in the case of a local domestic insurance company which is a member of an insurance holding company system, as defined in section 38a-129, these credits shall apply if the total admitted assets of the local domestic insurance company and its affiliates, as defined in said section, do not exceed two hundred fifty million dollars or, in the alternative, in the case of a local domestic insurance company which is a member of an insurance holding company system, as defined in section 38a-129, these credits shall apply only if total direct written premiums are derived from policies issued or delivered in Connecticut, on risk located in Connecticut and, as of the end of the income year the company and its affiliates have admitted assets minus unpaid losses and loss adjustment expenses that are also discounted for federal and state tax purposes and which for said local domestic insurance company and its affiliates, as defined in said section do not exceed two hundred fifty million dollars.

(1949 Rev., S. 1884; 1953, S. 1083d; 1957, P.A. 115; 1959, P.A. 140, S. 1; 1961, P.A. 604, S. 1; 1972, P.A. 285, S. 9; P.A. 73-350, S. 2, 27; P.A. 74-269, S. 1, 2; P.A. 80-482, S. 341, 348; P.A. 90-28, S. 6; 90-333, S. 4; P.A. 93-74, S. 4, 67; May Sp. Sess. P.A. 94-4, S. 4, 5, 85; P.A. 95-160, S. 64, 69; 95-303, S. 1, 3.)

History: 1959 act imposed tax for years 1961, 1962 and 1963; 1961 act changed the rate payable on net direct life insurance premiums from 1.75% to 2.5%, and increased the rate on other net direct premiums from 2% to 2.75%, deleted obsolete references to taxes payable in past years, and stated that franchise tax is in addition to excise tax imposed under Sec. 12-203 of 1959 Supplement; 1972 act made 2.5% rate applicable to net direct insurance premiums received before July 1, 1973, and established 2% rate on net direct premiums received on and after that date; P.A. 73-350 deleted tax on total net direct annuity considerations, stated that franchise tax is in addition to tax imposed under chapter 208 and added provisions re tax credits for local domestic insurance companies, effective May 9, 1973, and applicable to income years beginning on or after January 1, 1973; P.A. 74-269 substituted “paid” for “payable” in tax credit provision, reduced 80% credit by “any refunds of taxes paid by such company and granted under said chapter (208) for such income year” and specified that credit is applicable to tax “payable with respect to total net direct premiums received during such income year”, effective May 29, 1974, and applicable to tax payable on premiums received after December 31, 1972; P.A. 80-482 made credit applicable to companies with assets not exceeding $75,000,000 rather than $50,000,000, included new 80% credit for assessments paid under Sec. 38-53b, limited credits so that tax not reduced to less than zero and limited credits to companies which are members of a holding company system to companies with assets not exceeding $150,000,000 rather than $100,000,000; P.A. 90-28 deleted reference to a tax on investment income imposed under repealed Sec. 12-203; P.A. 90-333 increased the maximum amount of assets with respect to which a company may be allowed the tax credit provided under this section from $75,000,000 to $95,000,000 and in the case of an insurance holding company system such maximum with respect to the affiliated companies is increased from $150,000,000 to $175,000,000; P.A. 93-74 increased the maximum amount of assets with respect to which an affiliated company may be allowed the tax credit provided under this section from $175,000,000 to $200,000,000, effective May 19, 1993, and applicable to taxable years commencing January 1, 1993; May Sp. Sess. P.A. 94-4 increased the maximum amount of assets with respect to which an insurance holding company may be allowed the tax credit provided under section from $200,000,000 to $250,000,000, effective June 9, 1994, and applicable to taxable years commencing on or after January 1, 1994; and also deleted obsolete provisions and decreased the rate of tax on net direct premiums from 2% to 1.75%, effective January 1, 1995, and applicable to premiums due on or after said date; P.A. 95-160 revised effective date of May Sp. Sess. P.A. 94-4 but without affecting this section; P.A. 95-303 added alternative re application to companies with total direct written premiums derived from policies issued or delivered in Connecticut on risk located in Connecticut having admitted assets minus unpaid losses and loss adjustment expenses which do not exceed $250,000,000, effective July 6, 1995, and applicable to taxable years commencing on or after January 1, 1996.

Cited. 16 CS 134.

Sec. 12-202a. Tax on net direct subscriber charges of health care centers. Exceptions. (a) Each health care center, as defined in section 38a-175, that is governed by sections 38a-175 to 38a-192, inclusive, shall pay a tax to the Commissioner of Revenue Services for the calendar year commencing on January 1, 1995, and annually thereafter, at the rate of one and three-quarters per cent of the total net direct subscriber charges received by such health care center during each such calendar year on any new or renewal contract or policy approved by the Insurance Commissioner under section 38a-183. Such payment shall be in addition to any other payment required under section 38a-48.

(b) Notwithstanding the provisions of subsection (a) of this section, the tax shall not apply to:

(1) Any new or renewal contract or policy entered into with the state on or after July 1, 1997, to provide health care coverage to state employees, retirees and their dependents;

(2) Any subscriber charges received from the federal government to provide coverage for Medicare patients;

(3) Any subscriber charges received under a contract or policy entered into with the state to provide health care coverage to Medicaid recipients which charges are attributable to a period on or after January 1, 1998;

(4) Any new or renewal contract or policy entered into with the state on or after April 1, 1998, to provide health care coverage to eligible beneficiaries under the HUSKY Plan, Part A, HUSKY Plan, Part B, or HUSKY Plus programs, each as defined in section 17b-290;

(5) Any new or renewal contract or policy entered into with the state on or after February 1, 2000, to provide health care coverage to retired teachers, spouses or surviving spouses covered by plans offered by the state teachers’ retirement system;

(6) Any new or renewal contract or policy entered into on or after July 1, 2001, to provide health care coverage to employees of a municipality and their dependents under a plan procured pursuant to section 5-259;

(7) Any new or renewal contract or policy entered into on or after July 1, 2001, to provide health care coverage to employees of nonprofit organizations and their dependents under a plan procured pursuant to section 5-259;

(8) Any new or renewal contract or policy entered into on or after July 1, 2003, to provide health care coverage to individuals eligible for a health coverage tax credit and their dependents under a plan procured pursuant to section 5-259;

(9) Any new or renewal contract or policy entered into on or after July 1, 2005, to provide health care coverage to employees of community action agencies and their dependents under a plan procured pursuant to section 5-259; or

(10) Any new or renewal contract or policy entered into on or after July 1, 2005, to provide health care coverage to retired members and their dependents under a plan procured pursuant to section 5-259.

(c) The provisions of this chapter pertaining to the filing of returns, declarations, installment payments, assessments and collection of taxes, penalties, administrative hearings and appeals imposed on domestic insurance companies shall apply with respect to the charge imposed under this section.

(May Sp. Sess. P.A. 94-4, S. 49, 85; P.A. 95-160, S. 64, 69; June 18 Sp. Sess. P.A. 97-11, S. 57, 65; P.A. 98-110, S. 25, 27; P.A. 00-174, S. 78, 83; P.A. 01-30, S. 3, 4; June 30 Sp. Sess. P.A. 03-6, S. 65; P.A. 04-218, S. 14; P.A. 05-238, S. 2; P.A. 10-179, S. 47; June Sp. Sess. P.A. 10-1, S. 34; P.A. 11-25, S. 1; 11-44, S. 123.)

History: May Sp. Sess. P.A. 94-4, S. 49, effective January 1, 1995, and applicable to premiums due on or after said date; P.A. 95-160 revised effective date of May Sp. Sess. P.A. 94-4 but without affecting this section; June 18 Sp. Sess. P.A. 97-11 exempted new or renewal contracts and policies with the state on or after July 1, 1997, to provide health care coverage to state employees, retirees and their dependents, and exempted subscriber charges received from the federal government for Medicare patients, effective July 1, 1997; P.A. 98-110 divided the section into Subsecs. (a) to (c), inclusive, and added new Subdivs. (3) and (4) to Subsec. (b) to exempt state contracts under Sec. 17b-28, Husky Plan contracts and state-administered general assistance, effective May 19, 1998; P.A. 00-174 added Subsec. (b)(6) re an exemption for policies entered into with the state providing coverage to retired teachers and by making technical changes for accuracy of reference, effective May 26, 2000; P.A. 01-30 added Subsec. (b)(7) and (8) to exempt contracts or policies procured under Sec. 5-259 that cover employees of municipalities or nonprofit organizations, effective July 1, 2001; June 30 Sp. Sess. P.A. 03-6 added Subsec. (b)(9) re new or renewal contracts or policies entered into on or after July 1, 2003, for coverage of health coverage tax credit eligible individuals, effective August 20, 2003; P.A. 04-218 amended Subsec. (a) to specify applicability of section to centers governed by Secs. 38a-175 to 38a-192, inclusive, and to specify that the tax applies to charges approved by the Insurance Commissioner, effective June 8, 2004, and applicable to income years commencing on or after January 1, 2005; P.A. 05-238 made technical changes in Subsec. (b), amended Subsec. (b)(7) to include dependents, added Subsec. (b)(10) and (11) re employees of community action agencies and their dependents and re retired members and their dependents, effective July 1, 2005, and applicable to income years commencing on or after January 1, 2005; P.A. 10-179 amended Subsec. (b)(3) by deleting reference to Medicaid managed care program and amended Subsec. (b)(4) by deleting references to Medicaid and HUSKY Plus programs, effective July 1, 2010; June Sp. Sess. P.A. 10-1 added reference to HUSKY Plus programs in Subsec. (b)(4), effective July 1, 2010; P.A. 11-25 made technical changes in Subsec. (b)(4); P.A. 11-44 amended Subsec. (b) by deleting former Subdiv. (5) re contracts to provide health care coverage to recipients of state-administered general assistance and redesignated existing Subdivs. (6) to (11) as Subdivs. (5) to (10), effective July 1, 2011.

Sec. 12-202b. Tax credit for providers of HUSKY coverage. (a) For the income year commencing January 1, 2000, there shall be allowed as a credit against the tax imposed by section 12-202a an amount as calculated pursuant to subsection (b) of this section.

(b) The amount of credit allowed shall be equal to fifty-five dollars multiplied by the sum of the number of persons provided health care coverage by the taxpayer under the HUSKY Plan, Part A, HUSKY Plan, Part B or the HUSKY Plus programs, each as defined in section 17b-290, on the first day of each month of the income year for which the credit is taken, divided by twelve.

(c) The credit allowed under this section shall not be taken into account for purposes of the installment payments due under section 12-204c but shall be taken into account in the annual return required under section 12-205.

(d) The amount of credit allowed any taxpayer under this section for any income year may not exceed the amount of tax due from such taxpayer under section 12-202a with respect to such income year.

(P.A. 00-170, S. 19, 42; June Sp. Sess. P.A. 01-6, S. 4, 85; P.A. 02-3, S. 4.)

History: P.A. 00-170 effective May 26, 2000, and applicable to income years commencing on and after January 1, 2000; June Sp. Sess. P.A. 01-6 amended Subsec. (b) to designate existing provisions as Subdiv. (1), making conforming and technical changes therein, and to add new Subdiv. (2) re formula for the tax credit for income years commencing on or after January 1, 2001, effective July 1, 2001; P.A. 02-3 amended Subsecs. (a) and (b) to discontinue the credit for income years commencing on or after January 1, 2001, effective February 28, 2002.

Sec. 12-202c. Supplemental payments to providers of HUSKY coverage. (a) Any company filing the annual return required under section 12-205 for the income year commencing January 1, 2001, that, except for the amendment to section 12-202b made by section 4 of public act 02-3 providing for the repeal of the tax credit with respect to income years commencing on or after January 1, 2001, would have been entitled to take a credit under section 12-202b, shall be entitled for the fiscal year ending June 30, 2002, to a supplemental payment. The amount of the supplemental payment shall be equal to the amount of the credit the company would have received, provided such company, together with the final return, pays the full amount of the tax that is due and provides to the commissioner the computation of the amount of credit that could have been taken.

(b) For the fiscal year ending June 30, 2003, any company that received a payment under subsection (a) of this section shall be entitled to an additional supplemental payment equal to thirty-six dollars and seventy-five cents multiplied by the sum of the number of persons provided health care coverage by the taxpayer under the HUSKY Plan, Part A, HUSKY Plan, Part B or the HUSKY Plus programs, each as defined in section 17b-290, on the first day of each month, January to June, inclusive, of 2002, divided by six.

(P.A. 02-3, S. 5.)

History: P.A. 02-3 effective February 28, 2002.

Sec. 12-203. Tax on receipts of interest and dividends by domestic companies. Section 12-203 is repealed.

(1949 Rev., S. 1885; 1949, 1951, 1953, S. 1084d; 1957, P.A. 116; 1959, P.A. 139, S. 1; June, 1969, P.A. 1, S. 2; June, 1971, P.A. 5, S. 109; 1972, P.A. 285, S. 10; P.A. 90-28, S. 9.)

Sec. 12-204. Assessment and collection of taxes. (a) The commissioner shall within three years after the due date for the filing of a return or within three years after the date of receipt of such return by him, whichever period expires later, examine it and, in case any error is disclosed by such examination, shall, within thirty days after such disclosure, notify the taxpayer and the State Comptroller thereof. When it appears that any part of the deficiency for which a deficiency assessment is made is due to negligence or intentional disregard of the provisions of this chapter or regulations promulgated thereunder, there shall be imposed a penalty equal to ten per cent of the amount of such deficiency assessment, or fifty dollars, whichever is greater. When it appears that any part of the deficiency for which a deficiency assessment is made is due to fraud or intent to evade the provisions of this chapter or regulations promulgated thereunder, there shall be imposed a penalty equal to twenty-five per cent of the amount of such deficiency assessment. No taxpayer shall be subject to more than one penalty under this section in relation to the same tax period. Within thirty days of the mailing of such notice, the taxpayer shall pay to the commissioner, in cash or by check, draft or money order drawn to the order of the Commissioner of Revenue Services, any additional amount of tax shown to be due by the examination, or shall be paid by the State Treasurer, upon order of the Comptroller, any amount shown to be due it by such examination. The failure of the taxpayer to receive any notice required by this section shall not relieve it of the obligation to pay the tax or any interest or penalties thereon. If, before the expiration of the time prescribed by this section for the examination of the return or the assessment of the tax, both the commissioner and the taxpayer consent in writing to such examination or assessment after such time, the return may be examined and the tax may be assessed at any time prior to the expiration of the period agreed upon. The period so agreed upon may be extended by subsequent agreements in writing made before the expiration of the period agreed upon. The commissioner may also in such a case extend the period during which a claim for refund may be made by such taxpayer.

(b) To any taxes which are assessed under this section, there shall be added interest at the rate of one per cent per month or fraction thereof from the date when the original tax became due and payable. The amount of any tax, penalty or interest due and unpaid under the provisions of this chapter may be collected under the provisions of section 12-35. The warrant therein provided for shall be signed by the commissioner or his authorized agent. The amount of any such tax, penalty or interest shall be a lien on the real estate of the taxpayer from the thirty-first day of December next preceding the due date of such tax until such tax is paid. The commissioner may, at any time after such December thirty-first, record such lien in the records of any town in which the real estate of such company is situated, but no such lien shall be enforceable against a bona fide purchaser or qualified encumbrancer of such real estate. When any tax with respect to which a lien has been recorded under the provisions of this section has been satisfied, the commissioner upon request of any interested party, shall issue a certificate discharging such lien, which certificate shall be recorded in the same office in which the lien was recorded. Any action for the foreclosure of such lien shall be brought by the Attorney General in the name of the state in the superior court for the judicial district in which the property subject to such lien is situated, or, if such property is located in two or more judicial districts, in the superior court for any one such judicial district, and the court may limit the time for redemption or order the sale of such property or make such other or further decree as it judges equitable.

(1949, S. 1085d; June, 1969, P.A. 1, S. 3; P.A. 76-322, S. 22, 27; P.A. 77-614, S. 139, 610; P.A. 80-307, S. 2, 31; P.A. 81-64, S. 2, 23; 81-411, S. 10, 42; P.A. 82-172, S. 2, 14; P.A. 88-314, S. 2, 54; P.A. 90-333, S. 1; P.A. 93-361, S. 2; P.A. 95-26, S. 1, 52.)

History: 1969 act included exceptions re date when taxes due and re payment and required examination of return within three years rather than on or before the next following December thirty-first; P.A. 76-322 increased interest on overdue taxes from three-fourths of 1% to 1%; P.A. 77-614 substituted commissioner of revenue services for tax commissioner, effective January 1, 1979; P.A. 80-307 increased interest rate to 1.25% for taxes due on or after July 1, 1980, but not later than June 30, 1981, and reduced rate to 1% thereafter; P.A. 81-64 amended the penalty provision related to taxes not paid when due to provide for a minimum penalty of $50; P.A. 81-411 provided for continuance of interest on delinquent taxes at 1.25% per month, effective July 1, 1981, and applicable to taxes payable to state which become due on or after that date; P.A. 82-172 added reference to the collection procedure under section 12-35 and description of the foreclosure procedure for the lien on real estate of the taxpayer; P.A. 88-314 provided clarification and changes related to period in which commissioner shall examine returns, penalty to be imposed in the event of a deficiency assessment, agreement between the commissioner and taxpayer as to an extension of time for examination of return or assessment of deficiency and the addition of interest to deficiency assessments including rate thereof and period applied, effective July 1, 1988, and applicable to any tax which first becomes due and payable on or after said date, to any return or report due on or after said date, or in the case of any ongoing obligation imposed in accordance with said act, to the tax period next beginning on or after said date; P.A. 90-333 amended Subsec. (b) by increasing the rate of interest to be added from 1.25% to 1.66% per month; P.A. 93-361 made technical changes in Subsec. (a); P.A. 95-26 amended Subsec. (b) to lower interest rate from 1.66% to 1%, effective July 1, 1995, and applicable to taxes due and owing on or after July 1, 1995, whether or not those taxes first became due before said date.

Cited. 164 C. 497, 504.

Cited. 16 CS 134.

Secs. 12-204a and 12-204b. Declaration of estimated tax. Installment payments. Sections 12-204a and 12-204b are repealed, effective July 1, 1995, and applicable to estimated corporation business taxes for income years commencing on or after January 1, 1996.

(June, 1969, P.A. 1, S. 4, 5; 1972, P.A. 285, S. 13; P.A. 89-16, S. 9, 10, 31; P.A. 95-327, S. 9, 10.)

Sec. 12-204c. Installment payments. Interest on unpaid installments. (a) Except as otherwise provided in this section, in the case of any underpayment of estimated tax by a company, there shall be added to the tax under this chapter for the calendar year an amount determined by applying (1) interest at the rate of one per cent per month or portion thereof, (2) to the amount of the underpayment, (3) for the period of the underpayment.

(b) For purposes of subsection (a) of this section, the amount of the underpayment shall be the excess of the required installment, over the amount, if any, of the installment paid on or before the due date for the installment. For purposes of subsection (a) of this section, the period of the underpayment shall run from the due date for the installment to whichever of the following dates is the earlier; the first day of the third month following the close of the calendar year, or, with respect to any portion of the underpayment, the date on which such portion is paid. For purposes of this subsection, a payment of estimated tax shall be credited against unpaid required installments in the order in which such installments are required to be paid.

(c) For purposes of this section, there shall be four required installments for each calendar year. The due date for the first required installment is the fifteenth day of the third month of the calendar year. The due date for the second required installment is the fifteenth day of the sixth month of the calendar year. The due date for the third required installment is the fifteenth day of the ninth month of the calendar year. The due date for the fourth required installment is the fifteenth day of the twelfth month of the calendar year.

(d) (1) The amount of the first required installment shall be thirty per cent of the required annual payment, as defined in subdivision (2) of this subsection. The amount of the second required installment shall be thirty per cent of the required annual payment, as defined in subdivision (2) of this subsection. The amount of the third required installment shall be twenty per cent of the required annual payment, as defined in subdivision (2) of this subsection. The amount of the fourth required installment shall be twenty per cent of the required annual payment, as defined in subdivision (2) of this subsection.

(2) The required annual payment means the lesser of: (A) Ninety per cent of the tax shown on the return for the calendar year or, if no return is filed, ninety per cent of the tax for such year, or (B) one hundred per cent of the tax shown on the return for the preceding calendar year. Subparagraph (B) of this subdivision shall not apply if the company did not file a return for such preceding calendar year showing a liability for tax.

(e) No addition to tax shall be imposed under subsection (a) of this section for any calendar year if the tax shown on the return for such calendar year or, if no return is filed, the tax for such calendar year, is less than one thousand dollars.

(f) The application of this section to calendar years of less than twelve months shall be in accordance with regulations adopted by the commissioner.

(g) At the election of the company, an installment of the estimated tax may be paid prior to the date prescribed for its payment.

(h) Payment of the estimated premium tax, or any installment thereof, shall be considered payment on account of the premium tax imposed under this chapter for the income year.

(June, 1969, P.A. 1, S. 6; P.A. 76-322, S. 23, 27; P.A. 80-307, S. 3, 31; P.A. 81-411, S. 11, 42; P.A. 89-16, S. 11, 31; P.A. 90-333, S. 2; P.A. 95-26, S. 2, 52; 95-327, S. 5, 10; P.A. 96-139, S. 4, 13.)

History: P.A. 76-322 increased interest rate on unpaid installment from three-fourths of 1% to 1%; P.A. 80-307 increased interest rate to 1.25% for taxes due between July 1, 1980, and June 30, 1981, and reduced rate to 1% thereafter; P.A. 81-411 continued interest on delinquent taxes at 1.25% per month, effective July 1, 1981, and applicable to taxes becoming due on or after that date; P.A. 89-16 added minimum installment requirements as a percentage of estimated tax and the accuracy requirement related to the estimated tax, and added Subsec. (b) imposing a penalty when the estimated tax is less than the required percentage of actual tax determined as due, effective March 23, 1989, and applicable to income years commencing on or after January 1, 1989; P.A. 90-333 amended Subsec. (a) by increasing the rate of interest to be paid on the part of the installment not paid as required from 1.25% to 1.66% per month; P.A. 95-26 amended Subsec. (a) to lower interest rate from 1.66% to 1%, effective July 1, 1995, and applicable to taxes due and owing on or after July 1, 1995, whether or not those taxes first became due before said date; P.A. 95-327 deleted Subsecs. (a) and (b) and added new Subsecs. (a) to (h) re timing and amounts of installment payments, interest on underpaid installments and provisions re application of section, effective July 1, 1995, and applicable to estimated corporation business taxes for income years commencing on or after January 1, 1996; P.A. 96-139 amended Subsec. (d) to make technical relettering correction in Subdiv. (1) re reference to Subdiv. (2) of this subsection and amended Subdiv. (2) to change 100% to 90% and make technical changes, effective May 29, 1996.

Sec. 12-204d. Payment and disposition of installments. The amount of every installment of estimated tax, or payment on account thereof, shall be paid to the commissioner in cash or by check, draft or money order drawn to the order of the Commissioner of Revenue Services of the state of Connecticut. All funds received by the commissioner under the provisions of sections 12-204, 12-204c to 12-204g, inclusive, 12-212 and 12-212a shall be recorded with the Comptroller and shall be deposited daily with the State Treasurer. The commissioner shall issue his receipt to any domestic insurance company or other person for any payment made under the provisions of said sections, upon request.

(June, 1969, P.A. 1, S. 7; P.A. 77-614, S. 139, 610; P.A. 90-28, S. 7; 90-196, S. 2, 5; P.A. 95-327, S. 6, 10.)

History: P.A. 77-614 substituted commissioner of revenue services for tax commissioner, effective January 1, 1979; P.A. 90-28 deleted reference to repealed Sec. 12-203; P.A. 90-196 added Sec. 12-212 to the list of sections with respect to which provisions of this section apply, thus making such provisions applicable in the case of foreign companies as well as domestic companies, effective June 6, 1990, and applicable to income years commencing on or after January 1, 1990; P.A. 95-327 changed reference to Sec. 12-204a to Sec. 12-204c, effective July 1, 1995, and applicable to estimated corporation business taxes for income years commencing on or after January 1, 1996.

Sec. 12-204e. Liability of fiduciary conducting or liquidating business. Any fiduciary who conducts or is liquidating the business or is selling the assets of any domestic insurance company or of a corporation organized under sections 38a-199 to 38a-209, inclusive, or 38a-214 to 38a-225, inclusive, shall be subject to the provisions of section 12-204c, in the same manner and to the same extent as if the business were being conducted or liquidated or assets sold by agents or officers of such company. Payments on account of estimated taxes or charges shall be made by the fiduciary for both that part of the calendar year during which the company exercised its franchise and for that part of the calendar year in which the fiduciary himself was acting.

(June, 1969, P.A. 1, S. 8; P.A. 95-327, S. 7, 10.)

History: P.A. 95-327 replaced the reference to the filing of declarations and the payment of taxes and charges imposed by this chapter with reference to the “provisions of section 12-204c” and made technical changes, effective July 1, 1995, and applicable to estimated corporation business taxes for income years commencing on or after January 1, 1996.

Sec. 12-204f. Overpayments. Regulations. If any domestic insurance company has paid as an installment of estimated tax an amount in excess of the amount determined to be the correct amount of such installment, such amount shall be credited against any unpaid installment or against the tax. If the amount already paid, whether or not on the basis of installments, exceeds the amount determined to be the correct amount of the tax, such company shall be paid by the State Treasurer, upon order of the Comptroller, the amount of such overpayment. The commissioner may prescribe regulations providing for the crediting against the estimated tax for any taxable year of the amount determined to be an overpayment of the premium tax for a preceding taxable year.

(June, 1969, P.A. 1, S. 9; P.A. 95-327, S. 8, 10.)

History: P.A. 95-327 added authority for commissioner to prescribe regulations re crediting overpayment against estimated tax, effective July 1, 1995, and applicable to estimated corporation business taxes for income years commencing on or after January 1, 1996.

Sec. 12-204g. Regulations. The Commissioner of Revenue Services may prescribe regulations and make rulings, not inconsistent with law, to carry into effect the provisions of sections 12-204, 12-204c to 12-204g, inclusive, 12-212, and 12-212a, which regulations or rulings, when reasonably designed to carry out the intent and purpose of said sections, shall be prima facie evidence of its proper interpretation. The commissioner shall, from time to time, publish for distribution all regulations prescribed hereunder, including any of such rulings which appear to him to be of general interest.

(June, 1969, P.A. 1, S. 11; P.A. 77-614, S. 139, 610; P.A. 90-28, S. 8; 90-196, S. 3, 5.)

History: P.A. 77-614 substituted commissioner of revenue services for tax commissioner, effective January 1, 1979; P.A. 90-28 deleted reference to repealed Sec. 12-203; P.A. 90-196 added Sec. 12-212 to the list of sections with respect to which provisions of this section apply, thus making such provisions applicable in the case of foreign companies as well as domestic companies, effective June 6, 1990, and applicable to income years commencing on or after January 1, 1990; (Revisor’s note: In 1997 references to Secs. 12-201a, 12-204a and (by inference) 12-204b were deleted editorially by the Revisors and replaced by reference to Sec. 12-204c, since those sections were repealed by P.A. 95-327).

Sec. 12-205. Annual return. Extensions. Each domestic insurance company doing business in this state shall, on or before the first day of March, annually, render to the Commissioner of Revenue Services an annual return, on forms prescribed or furnished by the commissioner and signed by one of the principal officers of such company, stating specifically the name of the company and the location of its principal office, the names and locations of any subsidiary domestic insurance companies or insurance holding companies, the interest, dividends, premiums and other items of gross income received by such company and by each of the departments of such company during the next preceding calendar year, the deductions from such items of gross income as specified in this chapter and such other information as the commissioner may require for the purpose of making any computations required by this chapter and for the enforcement of this chapter. The amount of tax reported to be due on such return shall be due and payable on or before said first day of March. Payments shall be made in cash or by check, draft or money order drawn to the order of the Commissioner of Revenue Services. The commissioner may, for good cause shown, extend the time for making the return and paying the tax, if a written request is filed with the commissioner together with a tentative return which must be accompanied by a payment of the tax reported to be due thereon on or before said first day of March. Any company to which an extension is granted shall pay, in addition to the tax, interest at the rate of one per cent per month or fraction thereof from the date on which the tax would have been due without the extension until the date of payment.

(1949 Rev., S. 1886; P.A. 77-614, S. 139, 610; P.A. 85-381, S. 1; P.A. 93-361, S. 3; P.A. 97-243, S. 8, 67; P.A. 98-244, S. 4, 35.)

History: P.A. 77-614 substituted commissioner of revenue services for tax commissioner, effective January 1, 1979; P.A. 85-381 made technical changes in language, deleted provision imposing $1,000 fine for failure to make return in timely fashion, and added provision re the date such tax is due and specifying the manner of payment; P.A. 93-361 authorized commissioner to extend the time for making return and imposed interest penalty; P.A. 97-243 reduced rate of interest from 1.66% to 1%, effective June 24, 1997, and applicable to taxes due and owing on or after July 1, 1995; P.A. 98-244 eliminated notarization requirement, effective June 8, 1998, and applicable to calendar years commencing on or after January 1, 1998.

Sec. 12-206. Penalties for late filing and wilful submission of fraudulent return or document. (a) If any company fails to pay the amount of tax reported to be due on its return within the time specified under the provisions of this chapter, there shall be imposed a penalty equal to ten per cent of such amount due and unpaid, or fifty dollars, whichever is greater. Such amount shall bear interest at the rate of one per cent per month or fraction thereof, from the due date of such tax until the date of payment.

(b) If any company has not made its return within three months after the time specified under the provisions of this chapter, the commissioner may make such return at any time thereafter, according to the best information obtainable and according to the form prescribed. To the tax imposed upon the basis of such return, there shall be added an amount equal to ten per cent of such tax, or fifty dollars, whichever is greater. The tax shall bear interest at the rate of one per cent per month or fraction thereof, from the due date of such tax until the date of payment. No taxpayer shall be subject to a penalty under both subsections (a) and (b) of this section in relation to the same tax period.

(c) Subject to the provisions of section 12-3a, the commissioner may waive all or part of the penalties provided under this chapter when it is proven to his satisfaction that the failure to pay any tax was due to reasonable cause and was not intentional or due to neglect.

(d) Any person required under this chapter to pay any tax, or required under this chapter or by regulations adopted in accordance with the provisions of section 12-204g to make a return, keep any records or supply any information, who wilfully fails to pay such tax, make such return, keep such records or supply such information, at the time required by law or regulations, shall, in addition to any other penalty provided by law, be fined not more than one thousand dollars or imprisoned not more than one year or both. As used in this subsection, “person” includes any officer or employee of a corporation, or a member or employee of a partnership under a duty to pay such tax, to make such return, keep such records or supply such information. Notwithstanding the provisions of section 54-193, no person shall be prosecuted for a violation of the provisions of this subsection committed on or after July 1, 1997, except within three years next after such violation has been committed.

(e) Any person who wilfully delivers or discloses to the commissioner or his authorized agent any list, return, account, statement, or other document, known by him to be fraudulent or false in any material matter, shall, in addition to any other penalty provided by law, be fined not more than five thousand dollars or imprisoned not more than five years nor less than one year or both. No person shall be charged with an offense under both subsections (d) and (e) of this section in relation to the same tax period but such person may be charged and prosecuted for both such offenses upon the same information.

(f) (1) Any company subject to any tax or charge under this chapter, believing that it has overpaid any tax, other than any estimated tax paid pursuant to section 12-204c, due under the provisions of this chapter may file a claim for refund in writing with the commissioner within three years from the due date for which such overpayment was made, stating the specific grounds upon which the claim is founded. Failure to file a claim within the time prescribed in this section constitutes a waiver of any demand against the state on account of overpayment. Not later than ninety days following receipt of such claim for refund, the commissioner shall determine whether such claim is valid and, if so determined, said commissioner shall notify the State Comptroller of the amount of such refund and the State Comptroller shall draw an order on the State Treasurer in the amount thereof for payment to the taxpayer. If the commissioner determines that such claim is not valid, either in whole or in part, he shall mail notice of the proposed disallowance in whole or in part of the claim to the claimant, which notice shall set forth briefly the commissioner’s findings of fact and the basis of disallowance in each case decided in whole or in part adversely to the claimant. Sixty days after the date on which it is mailed, a notice of proposed disallowance shall constitute a final disallowance except only for such amounts as to which the company has filed, as provided in subdivision (2) of this subsection, a written protest with the commissioner.

(2) On or before the sixtieth day after the mailing of the proposed disallowance, the company may file with the commissioner a written protest against the proposed disallowance in which it sets forth the grounds on which the protest is based. If a protest is filed, the commissioner shall reconsider the proposed disallowance and, if the company has so requested, may grant or deny the company or its authorized representatives an oral hearing.

(3) The commissioner shall mail notice of his determination to the company, which notice shall set forth briefly the commissioner’s findings of fact and the basis of decision in each case decided in whole or in part adversely to the company.

(4) The action of the commissioner on the company’s protest shall be final upon the expiration of one month from the date on which he mails notice of his action to the company unless within such period the company seeks judicial review of the commissioner’s determination pursuant to subsection (b) of section 12-208.

(1949 Rev., S. 1887; P.A. 76-322, S. 24, 27; P.A. 77-614, S. 139, 610; P.A. 80-307, S. 4, 31; P.A. 81-64, S. 3, 23; 81-411, S. 12, 42; P.A. 88-314, S. 3, 54; P.A. 93-361, S. 4; May Sp. Sess. P.A. 94-4, S. 53, 85; P.A. 95-26, S. 3, 52; 95-160, S. 64, 69; P.A. 97-203, S. 1, 20; 97-243, S. 51, 67.)

History: P.A. 76-322 increased interest rate from three-fourths of 1% to 1%; P.A. 77-614 substituted commissioner of revenue services for tax commissioner, effective January 1, 1979; P.A. 80-307 increased interest rate to 1.25% for taxes due between July 1, 1980, and June 30, 1981, and reduced rate to 1% thereafter; P.A. 81-64 amended penalty provision related to taxes not paid when due to provide for a minimum penalty of $50 and added the waiver of penalty provision applicable to other state taxes; P.A. 81-411 continued interest on delinquent taxes at 1.25% per month, effective July 1, 1981, and applicable to taxes becoming due on or after that date; P.A. 88-314 deleted the entire section concerning fraudulent returns and substituted provisions re penalty and interest to be imposed if tax is not paid within the time specified, procedure when company has not made its return within three months after time specified and penalty in the event of wilful submission of fraudulent return or document, effective July 1, 1988, and applicable to any tax which first becomes due and payable on or after said date, to any return or report on or after said date, or in the case of any ongoing obligation imposed in accordance with said act, to the tax period next beginning on or after said date; P.A. 93-361 added Subsec. (f) providing for claims for refund of taxes upon overpayment; May Sp. Sess. P.A. 94-4 in Subsec. (b) reduced interest rate from 1.66% to 1% and provided that such interest may only be applied on the tax rather than on the tax and any penalty, effective July 1, 1995, and applicable to taxes due and owing on or after said date; P.A. 95-26 amended Subsec. (a) to lower interest rate from 1.66% to 1%, effective July 1, 1995, and applicable to taxes due and owing on or after July 1, 1995, whether or not those taxes first became due before said date (Revisor’s note: A reference in Subsec. (f) to Sec. 12-204b, repealed by P.A. 95-327, was deleted editorially by the Revisors); P.A. 95-160 revised effective date of May Sp. Sess. P.A. 94-4 but without affecting this section; P.A. 97-203 amended Subsec. (d) to extend to three years the time within which persons wilfully failing to file tax returns or pay taxes may be criminally prosecuted, effective July 1, 1997; P.A. 97-243 amended Subsec. (f) to provide for an administrative hearing with the department before taking an appeal to the Superior Court, to establish the time for filing a claim and to provide that failure to file within the time prescribed constitutes a waiver of any demand against the state on account of overpayment, effective July 1, 1997, and applicable to claims for refund filed on or after said date.

Sec. 12-207. Oaths and subpoenas. The commissioner and any agent of the commissioner duly authorized to conduct any inquiry, investigation or hearing hereunder shall have power to administer oaths and take testimony under oath relative to the matter of inquiry or investigation. At any hearing ordered by the commissioner, the commissioner or his agent authorized to conduct such hearing and having authority by law to issue such process may subpoena witnesses and require the production of books, papers and documents pertinent to such inquiry. No witness under subpoena authorized to be issued by the provisions of this chapter shall be excused from testifying or from producing books or papers on the ground that such testimony or the production of such books or other documentary evidence would tend to incriminate him, but such evidence or the books or papers so produced shall not be used in any criminal proceeding against him. If any person disobeys such process or, having appeared in obedience thereto, refuses to answer any pertinent question put to him by the commissioner or his authorized agent, or to produce any books and papers pursuant thereto, the commissioner or such agent may apply to the superior court of the judicial district wherein the taxpayer resides or wherein the business has been conducted, or to any judge of said court if the same is not in session, setting forth such disobedience to process or refusal to answer, and said court or such judge shall cite such person to appear before said court or such judge to answer such question or to produce such books and papers and, upon his refusal so to do, shall commit such person to a community correctional center until he testifies, but not for a longer period than sixty days. Notwithstanding the serving of the term of such commitment by any person, the commissioner may proceed in all respects with such inquiry and examination as if the witness had not previously been called upon to testify. Officers who serve subpoenas issued by the commissioner or under his authority and witnesses attending hearings conducted by him hereunder shall receive fees and compensation at the same rates as officers and witnesses in the courts of this state, to be paid on vouchers of the commissioner on order of the Comptroller from the proper appropriation for the administration of this chapter.

(1949 Rev., S. 1888; 1969, P.A. 297; P.A. 78-280, S. 2. 127.)

History: 1969 act substituted “community correctional center” for “jail”; P.A. 78-280 substituted “judicial district” for “county”.

Sec. 12-208. Application for administrative hearing and appeal therefrom to Superior Court. (a) Any company subject to any tax or charge under this chapter that is aggrieved by the action of the commissioner or his authorized agent in fixing the amount of any tax, penalty, interest or charge provided for by this chapter may apply to the commissioner, in writing, within sixty days after the notice of such action is delivered or mailed to it, for a hearing and a correction of the amount of such tax, penalty, interest or charge, so fixed, setting forth the reasons why such hearing should be granted and the amount in which such tax, penalty, interest or charge should be reduced. The commissioner shall promptly consider each such application and may grant or deny the hearing requested. If the hearing is denied, the applicant shall be notified forthwith. If it is granted, the commissioner shall notify the applicant of the time and place fixed for such hearing. After such hearing the commissioner may make such order in the premises as appears to him just and lawful and shall furnish a copy of such order to the applicant. The commissioner may, by notice in writing, at any time within three years after the date when any return of any such person has been due, order a hearing on his own initiative and require such person or any other individual whom he believes to be in possession of relevant information concerning such person to appear before him or his authorized agent with any specified books of account, papers or other documents, for examination under oath.

(b) Any company subject to any tax or charge under this chapter that is aggrieved because of any order, decision, determination or disallowance of the Commissioner of Revenue Services made under this chapter may, within one month after service of notice of such order, decision, determination or disallowance, take an appeal therefrom to the superior court for the judicial district of New Britain, which appeal shall be accompanied by a citation to the Commissioner of Revenue Services to appear before said court. Such citation shall be signed by the same authority, and such appeal shall be returnable at the same time and served and returned in the same manner, as is required in case of a summons in a civil action. The authority issuing the citation shall take from the appellant a bond or recognizance to the state of Connecticut, with surety, to prosecute the appeal to effect and to comply with the orders and decrees of the court in the premises. Such appeals shall be preferred cases, to be heard, unless cause appears to the contrary, at the first session, by the court or by a committee appointed by the court. Said court may grant such relief as may be equitable and, if such tax or charge has been paid prior to the granting of such relief, may order the State Treasurer to pay the amount of such relief, with interest at the rate of two-thirds of one per cent per month or fraction thereof, to such aggrieved person. If the appeal has been taken without probable cause, the court may tax double or triple costs, as the case demands; and, upon all such appeals which are denied, costs may be taxed against the appellant at the discretion of the court, but no costs shall be taxed against the state.

(1949 Rev., S. 1890; 1949, S. 1087d; 1971, P.A. 870, S. 21; P.A. 76-436, S. 310, 681; P.A. 77-614, S. 139, 163, 610; P.A. 78-280, S. 5, 127; P.A. 80-347; 80-482, S. 16, 348; P.A. 82-259, S. 1, 7; P.A. 88-230, S. 1, 12; P.A. 89-343, S. 5, 17; P.A. 90-98, S. 1, 2; P.A. 91-236, S. 1, 25; P.A. 93-142, S. 4, 7, 8; P.A. 95-26, S. 4, 52; 95-220, S. 4–6; P.A. 97-243, S. 9, 67; P.A 99-215, S. 24, 29.)

History: 1971 act substituted court of common pleas for superior court, effective September 1, 1971, except that courts with cases pending on that date retain jurisdiction unless cases deemed transferable; P.A. 76-436 substituted superior court for court of common pleas, effective July 1, 1978; P.A. 77-614 substituted commissioner of revenue services for tax commissioner, placed insurance commissioner within department of business regulation and made insurance department a division within that department, effective January 1, 1979; P.A. 78-280 substituted “judicial district” for “county”; P.A. 80-347 and 80-482 deleted requirement that citation be sent to insurance commissioner; P.A. 82-259 amended section so as to specifically provide for application for administrative hearing concerning any tax, penalty, interest or charge by any insurance company, hospital service corporation, medical service corporation or entity maintaining an employee welfare benefit plan; amended the procedure for appeal from decisions of the commissioner to the superior court so as to be in conformity with provisions concerning administrative hearings; P.A. 88-230 replaced “judicial district of Hartford-New Britain” with “judicial district of Hartford”, effective September 1, 1991; P.A. 89-343 amended Subsec. (b) to increase the rate of interest on the amount of relief ordered by the court from 6% to 9% per annum; P.A. 90-98 changed the effective date of P.A. 88-230 from September 1, 1991, to September 1, 1993; P.A. 91-236 amended Subsec. (a) to provide for 60, rather than 30, days to request a hearing, effective July 1, 1991, and applicable to taxes due on or after that date; P.A. 93-142 changed the effective date of P.A. 88-230 from September 1, 1993, to September 1, 1996, effective June 14, 1993; P.A. 95-26 amended Subsec. (b) to lower interest rate from 9% per annum to two-thirds of 1% per month, effective July 1, 1995, and applicable to taxes due and owing on or after July 1, 1995, whether or not those taxes first became due before said date; P.A. 95-220 changed the effective date of P.A. 88-230 from September 1, 1996, to September 1, 1998, effective July 1, 1995; P.A. 97-243 clarified that all companies subject to tax or charge are able to appeal an adverse administrative decision to the Superior Court and make a technical change, effective June 24, 1997; P.A. 99-215 replaced “judicial district of Hartford” with “judicial district of New Britain” in Subsec. (b), effective June 29, 1999.

“Tax” includes penalties and interest. 164 C. 497.

Taxes paid under protest can be recovered only where statute so provides. 16 CS 134. Cited. 31 CS 134.

Sec. 12-209. Tax to be in lieu of certain other taxes. The taxes imposed by this chapter and chapter 208 shall be in lieu of all other taxes upon the intangible assets of any domestic insurance company, or the income therefrom, and shall be in lieu of all other taxes upon the franchises of domestic companies taxable hereunder; but such companies shall be taxable upon all real and tangible personal property not specifically exempt by law.

(1949 Rev., S. 1891; P.A. 73-350, S. 3, 27.)

History: P.A. 73-350 included reference to taxes under chapter 208, effective May 9, 1973, and applicable to income years beginning on or after January 1, 1973.

Sec. 12-210. Tax on net direct premiums of nonresident and foreign companies. (a) Each newly licensed insurance company incorporated by or organized under the laws of any other state or foreign government shall pay to the Commissioner of Revenue Services, within forty-five days of the effective date of such company’s initial license to transact business in this state, a tax on the net direct premiums received by such company in the next five preceding calendar years from policies written on property or risks located or resident in this state, except ocean marine insurance, at the rate in effect for each such calendar year.

(b) Each insurance company incorporated by or organized under the laws of any other state or foreign government and doing business in this state shall, annually, on and after January 1, 1995, pay to said Commissioner of Revenue Services, in addition to any other taxes imposed on such company or its agents, a tax of one and three-quarters per cent of all net direct premiums received by such company in the calendar year next preceding from policies written on property or risks located or resident in this state, excluding premiums for ocean marine insurance, and, upon ceasing to transact new business in this state, shall continue to pay a tax upon the renewal premiums derived from its business remaining in force in this state at the rate which was applicable when such company ceased to transact new business in this state.

(1949 Rev., S. 1892; 1967, P.A. 486, S. 1; 1972, P.A. 285, S. 11; P.A. 73-350, S. 4, 27; P.A. 76-196, S. 1, 2; P.A. 77-614, S. 163, 587, 610; P.A. 78-303, S. 85, 136; P.A. 79-320, S. 2; May Sp. Sess. P.A. 94-4, S. 6, 85; P.A. 95-160, S. 64, 69.)

History: 1967 act required payment of tax on renewal premiums derived from business remaining in force in state if company ceases to transact new business; 1972 act deleted provision taxing total net direct life insurance premiums at rate of 1.75%, leaving 2% rate applicable to all net direct premiums; P.A. 73-350 deleted reference to net direct annuity considerations, effective May 9, 1973, and applicable to income years beginning on or after January 1, 1973; P.A. 76-196 made former provisions Subsec. (b) and inserted new Subsec. (a) re taxes due from insurance companies newly licensed in state but incorporated or organized under laws of another state or foreign country; P.A. 77-614 and P.A. 78-303 placed insurance commissioner within department of business regulation and made insurance department a division within that department, effective January 1, 1979; P.A. 79-320 substituted commissioner of revenue services for insurance commissioner and deleted reference to abolished department of business regulation; May Sp. Sess. P.A. 94-4 in Subsec. (b) decreased the rate of tax on net direct premiums from 2% to 1.75%, effective January 1, 1995, and applicable to premiums due on or after said date; P.A. 95-160 revised effective date of May Sp. Ses. P.A. 94-4 but without affecting this section.

Cited. 208 C. 505; 233 C. 243.

Cited. 16 CS 133.

Sec. 12-210a. Deduction by nonresident companies of benefit payments from group health insurance premiums. In determining the tax payable under section 12-210 with respect to the calendar year 1976, and each subsequent year, every life insurance company incorporated by or organized under the law of any other state may deduct from the gross amount of premiums received on group policies or contracts providing health insurance benefits the entire amount of benefit payments made under such policies or contracts to residents of this state in such year, provided the state of incorporation of such life insurance company provides a similar deduction to all life insurance companies doing such business whether or not incorporated in said state.

(P.A. 76-346, S. 2, 3.)

History: P.A. 76-346 effective July 1, 1976, and applicable to calendar years commencing on or after January 1, 1976.

Sec. 12-211. Reciprocity. (a) When by the laws of any other state or foreign country any premium or income or other taxes or any fees, fines, penalties, licenses, deposit requirements or other obligations, prohibitions or restrictions are imposed upon Connecticut insurance companies doing business in such other state or foreign country, or upon the authorized agents thereof, which are in excess of such taxes, fees, fines, penalties, licenses, deposit requirements or other obligations, prohibitions or restrictions directly imposed upon insurance companies, or upon the authorized agents thereof, of such other state or foreign country doing business in Connecticut, as long as such laws continue in force the same obligations, prohibitions and restrictions of whatever kind, computed by the Commissioner of Revenue Services on an aggregate state-wide or foreign-country-wide basis, shall be imposed upon insurance companies and authorized agents thereof of such other state or foreign country doing business in Connecticut.

(b) Any tax obligation imposed by any city, county or other political subdivision of a state or foreign country on Connecticut insurance companies shall be deemed to be imposed by such state or foreign country within the meaning of this section. For the purposes of this section, the domicile of a foreign insurer shall be that state designated by the insurer in writing filed with said commissioner at the time of admission to this state or within six months after July 1, 1973, whichever date is later, and may be any one of the following states: (1) That in which the insurer was first authorized to engage in the insurance business; (2) that in which the principal place of business of such insurer in the United States is located; (3) that in which the largest deposit of trusteed assets of the insurer for the protection of its policyholders and creditors in the United States is held. Any designation so made hereunder shall be irrevocable and, if the insurer makes no such designation at or within the time provided herein, its domicile shall irrevocably be deemed to be that state in which the insurer was first authorized to engage in the insurance business in the United States. The domicile of an insurer formed under the laws of Canada or a province thereof shall be deemed to be that province in which its head office is situated.

(c) The provisions of this section shall not apply to ad valorem taxes on real or personal property, personal income taxes, fees for agents’ licenses, special purpose assessments imposed in connection with particular kinds of insurance including, but not limited to, workers’ compensation assessments and Insurance Guaranty Association Fund assessments, or to premium taxes on special health care plans as defined in section 38a-564, except in the case where another state or foreign country imposes upon Connecticut domiciled insurers retaliatory charges for such taxes, fees or assessments.

(1949 Rev., S. 1893; 1959, P.A. 514, S. 1; 1961, P.A. 10, S. 1; 1963, P.A. 467; February, 1965, P.A. 196, S. 3; P.A. 77-614, S. 163, 587, 610; P.A. 78-303, S. 85, 136; P.A. 79-320, S. 3; P.A. 87-557, S. 1, 2; P.A. 90-134, S. 15, 28; P.A. 05-100, S. 1; P.A. 06-196, S. 88.)

History: 1959 act made computation on an aggregate state-wide or foreign-country-wide basis mandatory rather than discretionary and specifically applied the tax to the authorized agent of an insurance company; 1961 act made the domicile of an insurance company organized in a country without supervision and regulation similar to that in the United States the state of entry; 1963 act deleted latter provision and added new provision for determining domicile of a foreign insurer; 1965 act included authorized agents of companies for other states or countries in provision re equalization of requirements for doing business, substituted “largest” for “larger” in Subdiv. (3) and exempted fees for agents’ licenses from provisions of section; P.A. 77-614 and P.A. 78-303 placed insurance commissioner within the department of business regulation and made insurance department a division within the department of business regulation, effective January 1, 1979; P.A. 79-320 substituted commissioner of revenue services for insurance commissioner and deleted reference to abolished department of business regulation; P.A. 87-557 added the provision that reciprocity as provided in this section shall not be applicable to special purpose assessments imposed in connection with particular kinds of insurance, including but not limited to workers’ compensation assessments and insurance guaranty association fund assessments; P.A. 90-134 exempted premium taxes on special health care plans from provisions of section; P.A. 05-100 divided section into Subsecs. (a) to (c) and amended Subsec. (c) to provide an exception to exemptions listed for imposition of retaliatory charges; P.A. 06-196 made a technical change in Subsec. (a), effective June 7, 2006.

Annotations to former statute:

Recovery of tax paid under rule adopted in another state and later reversed. 79 C. 154. Rhode Island company doing business here is not entitled to deduct from gross premium income subject to tax, reinsurance premiums paid to a Connecticut company, which is not required to pay a tax to state on such premiums. 112 C. 472.

Annotation to present section:

1987 amendment clarified original intent; retaliatory tax not applicable for special purpose assessments discussed. 233 C. 243.

Sec. 12-211a. Limit on credits under this chapter. Exceptions. (a)(1) Notwithstanding any provision of the general statutes, and except as otherwise provided in subdivision (4) of this subsection or in subsection (b) of this section, the amount of tax credit or credits otherwise allowable against the tax imposed under this chapter for any calendar year shall not exceed seventy per cent of the amount of tax due from such taxpayer under this chapter with respect to such calendar year of the taxpayer prior to the application of such credit or credits.

(2) For the calendar year ending December 31, 2011, “type one tax credits” means tax credits allowable under section 12-217jj, 12-217kk or 12-217ll; “type two tax credits” means tax credits allowable under section 38a-88a; “type three tax credits” means tax credits that are not type one tax credits or type two tax credits; “thirty per cent threshold” means thirty per cent of the amount of tax due from a taxpayer under this chapter prior to the application of tax credit; “fifty-five per cent threshold” means fifty-five per cent of the amount of tax due from a taxpayer under this chapter prior to the application of tax credits; and “seventy per cent threshold” means seventy per cent of the amount of tax due from a taxpayer under this chapter prior to the application of tax credits.

(3) For the calendar year ending December 31, 2012, “type one tax credits” means the tax credit allowable under section 12-217ll; “type two tax credits” means tax credits allowable under section 38a-88a; “type three tax credits” means tax credits that are not type one tax credits or type two tax credits; “thirty per cent threshold” means thirty per cent of the amount of tax due from a taxpayer under this chapter prior to the application of tax credit; “fifty-five per cent threshold” means fifty-five per cent of the amount of tax due from a taxpayer under this chapter prior to the application of tax credits; and “seventy per cent threshold” means seventy per cent of the amount of tax due from a taxpayer under this chapter prior to the application of tax credits.

(4) For calendar years commencing on or after January 1, 2011, and prior to January 1, 2013, and subject to the provisions of subdivisions (2) and (3) of this subsection, the amount of tax credit or credits otherwise allowable against the tax imposed under this chapter shall not exceed:

(A) If the tax credit or credits being claimed by a taxpayer are type three tax credits only, thirty per cent of the amount of tax due from such taxpayer under this chapter with respect to said calendar years of the taxpayer prior to the application of such credit or credits.

(B) If the tax credit or credits being claimed by a taxpayer are type one tax credits and type three tax credits, but not type two tax credits, fifty-five per cent of the amount of tax due from such taxpayer under this chapter with respect to said calendar years of the taxpayer prior to the application of such credit or credits, provided (i) type three tax credits shall be claimed before type one tax credits are claimed, (ii) the type three tax credits being claimed may not exceed the thirty per cent threshold, and (iii) the sum of the type one tax credits and the type three tax credits being claimed may not exceed the fifty-five per cent threshold.

(C) If the tax credit or credits being claimed by a taxpayer are type two tax credits and type three tax credits, but not type one tax credits, seventy per cent of the amount of tax due from such taxpayer under this chapter with respect to said calendar years of the taxpayer prior to the application of such credit or credits, provided (i) type three tax credits shall be claimed before type two tax credits are claimed, (ii) the type three tax credits being claimed may not exceed the thirty per cent threshold, and (iii) the sum of the type two tax credits and the type three tax credits being claimed may not exceed the seventy per cent threshold.

(D) If the tax credit or credits being claimed by a taxpayer are type one tax credits, type two tax credits and type three tax credits, seventy per cent of the amount of tax due from such taxpayer under this chapter with respect to said calendar years of the taxpayer prior to the application of such credits, provided (i) type three tax credits shall be claimed before type one tax credits or type two tax credits are claimed, and the type one tax credits shall be claimed before the type two tax credits are claimed, (ii) the type three tax credits being claimed may not exceed the thirty per cent threshold, (iii) the sum of the type one tax credits and the type three tax credits being claimed may not exceed the fifty-five per cent threshold, and (iv) the sum of the type one tax credits, the type two tax credits and the type three tax credits being claimed may not exceed the seventy per cent threshold.

(E) If the tax credit or credits being claimed by a taxpayer are type one tax credits and type two tax credits only, but not type three tax credits, seventy per cent of the amount of tax due from such taxpayer under this chapter with respect to said calendar years of the taxpayer prior to the application of such credits, provided (i) the type one tax credits shall be claimed before type two tax credits are claimed, (ii) the type one tax credits being claimed may not exceed the fifty-five per cent threshold, and (iii) the sum of the type one tax credits and the type two tax credits being claimed may not exceed the seventy per cent threshold.

(b) (1) For a calendar year commencing on or after January 1, 2011, and prior to January 1, 2013, the amount of tax credit or credits otherwise allowable against the tax imposed under this chapter for such calendar year may exceed the amount specified in subsection (a) of this section only by the amount computed under subparagraph (A) of subdivision (2) of this subsection, provided in no event may the amount of tax credit or credits otherwise allowable against the tax imposed under this chapter for such calendar year exceed one hundred per cent of the amount of tax due from such taxpayer under this chapter with respect to such calendar year of the taxpayer prior to the application of such credit or credits.

(2) (A) The taxpayer’s average monthly net employee gain for a calendar year shall be multiplied by six thousand dollars.

(B) The taxpayer’s average monthly net employee gain for a calendar year shall be computed as follows: For each month in the calendar year, the taxpayer shall subtract from the number of its employees in this state on the last day of such month the number of its employees in this state on the first day of the calendar year. The taxpayer shall total the differences for the twelve months in the calendar year, and such total, when divided by twelve, shall be the taxpayer’s average monthly net employee gain for the calendar year. For purposes of this computation, only employees who are required to work at least thirty-five hours per week and only employees who were not employed in this state by a related person, as defined in section 12-217ii, within the twelve months prior to the first day of the calendar year may be taken into account in computing the number of employees.

(C) If the taxpayer’s average monthly net employee gain is zero or less than zero, the taxpayer may not exceed the amount specified in subsection (a) of this section.

(June 30 Sp. Sess. P.A. 03-1, S. 86; P.A. 11-6, S. 75; 11-61, S. 48; Oct. Sp. Sess. P.A. 11-1, S. 54; Dec. Sp. Sess. P.A. 12-1, S. 42.)

History: June 30 Sp. Sess. P.A. 03-1 effective August 16, 2003; P.A. 11-6 designated existing provisions as Subsec. (a)(1) and amended same to change “income year” to “calendar year”, added Subsec. (a)(2) re two-year 30% cap on credits and added Subsec. (b) re allowable credit for average monthly net employee gain, effective May 4, 2011, and applicable to calendar years commencing on or after January 1, 2011; P.A. 11-61 amended Subsec. (a) by adding new Subdiv. (2) re definitions, re designating existing Subdiv. (2) re tax credit limit as Subdiv. (3)(A) and adding Subdiv. (3)(B) to (E) re amount of allowable tax credits, and amended Subsec. (b)(2)(C) by replacing reference to 30% limit with reference to amount specified in Subsec. (a), effective June 21, 2011, and applicable to calendar years commencing on or after January 1, 2011; Oct. Sp. Sess. P.A. 11-1 amended Subsec. (a)(2) by adding Secs. 12-217jj and 12-217kk as type one tax credits, effective October 27, 2011; Dec. Sp. Sess. P.A. 12-1 amended Subsec. (a) to replace “For purposes of this subsection” with “For the calendar year ending December 31, 2011” in Subdiv. (2), add new Subdiv. (3) re definitions applicable for the calendar year ending December 31, 2012, redesignate existing Subdiv. (3) as Subdiv. (4) and add “and subject to the provisions of subdivisions (2) and (3) of this subsection” therein, and make a technical change, effective December 21, 2012.

Sec. 12-212. Provisions of the tax on domestic companies pertaining to filing returns, collection of taxes and penalties made applicable to foreign companies. The provisions of this chapter pertaining to the filing of returns or declarations, the assessment and collection of taxes, and the imposition of interest and penalties on domestic insurance companies shall apply with respect to the taxes imposed under sections 12-210 and 12-211 on insurance companies incorporated by or organized under the laws of any other state or foreign government and doing business in this state or, having ceased to transact new business in this state, deriving business from renewal premiums remaining in force in this state.

(1949 Rev., S. 1894; February, 1965, P.A. 441, S. 1; 1967, P.A. 486, S. 2; P.A. 76-322, S. 25, 27; 76-346, S. 1, 3; P.A. 77-614, S. 163, 587, 610; P.A. 78-303, S. 85, 136; P.A. 79-320, S. 4; P.A. 80-307, S. 5, 31; P.A. 81-64, S. 4, 23; 81-411, S. 13, 42; P.A. 82-172, S. 3, 14; P.A. 89-16, S. 12, 31; P.A. 90-196, S. 4, 5; P.A. 90-333, S. 3.)

History: 1965 act divided section into Subsecs., excepted companies governed by Sec. 12-211 from provisions of section, required remission of full amount of tax with submission of return, deleted provision concerning insurance commissioner’s determination of tax and payment of tax by April first, included provision re penalty and interest on overdue taxes and deleted previous provision for $1,000 fine; 1967 act included under provisions companies ceasing to transact new business but deriving business from renewal premiums; P.A. 76-322 increased interest rate from three-fourths of 1% to 1%; P.A. 76-346 substituted “an amount equal, together with all prior payments on account ..., to the full amount due”, in payment provision of Subsec. (a), inserted new Subsec. (b) re estimated tax returns and relettered former Subsec. (b) as Subsec. (c); P.A. 77-614 and P.A. 78-303 placed insurance commissioner within department of business regulation and made insurance department a division of the department of business regulation, effective January 1, 1979; P.A. 79-320 substituted commissioner of revenue services for insurance commissioner and deleted reference to abolished department of business regulation and in Subsec. (b) deleted reference to payment due on December 15, 1976; P.A. 80-307 increased interest rate in Subsec. (c) to 1.25% for taxes due between July 1, 1980, and June 30, 1981, and reduced them to 1% thereafter; P.A. 81-64 in Subsec. (c) amended the penalty provision related to taxes not paid when due to provide for a minimum penalty of $50 and added the waiver of penalty provision applicable to other state taxes; P.A. 81-411 continued the interest on delinquent taxes under Subsec. (c) at 1.25% per month, effective July 1, 1981, and applicable to taxes becoming due on or after that date; P.A. 82-172 amended Subsec. (c) by adding provisions re collection of tax, penalty or interest under Sec. 12-35, creation of a lien against real estate of taxpayer and discharge thereof and the foreclosure procedure related to such lien; P.A. 89-16 amended Subsec. (b) to require payments of estimated tax in the third and ninth months of each calendar year, in addition to such payments already required in the sixth and twelfth months of each calendar year, and inserted provisions related to the minimum amount of each such payment, effective March 23, 1989, and applicable to income years commencing on or after January 1, 1989; P.A. 90-196 deleted the entire section and inserted in lieu thereof the statement that provisions of this chapter applicable to domestic companies for purposes of filing returns, collection of taxes and imposition of penalties shall also apply with respect to taxes imposed on companies incorporated in any other state or foreign government, effective June 5, 1990, and applicable to income years commencing on or after January 1, 1990; P.A. 90-333 amended Subsec. (c) by increasing the rate of interest to be added from 1.25% to 1.66% per month, but had no effect, those provisions having been deleted by P.A. 90-196.

Sec. 12-212a. Annual state charge applicable to hospital and medical service corporations. Such corporations not subject to tax under this chapter. All corporations organized under sections 38a-199 to 38a-209, inclusive, and 38a-214 to 38a-225, inclusive, shall pay to the Commissioner of Revenue Services on or before March first, annually, a charge at the rate of two per cent of the total net direct subscriber charges, excluding those net direct subscriber charges received after July 1, 1990, and before January 1, 1995, from employers for any special health care plan, as defined in section 38a-564, received by such corporation during the next preceding calendar year, which shall be in addition to any other payment required under section 38a-48. The charge required under this section and any other payment required under said section 38a-48 shall be in compensation for the costs and expenses of regulation by the Insurance Department and all other governmental services. The provisions of this chapter pertaining to the filing of returns, declarations, assessment and collection of taxes, and penalties imposed on domestic insurance companies shall apply with respect to the charge imposed under this section, provided corporations subject to the charge imposed under this section shall not be subject to any tax imposed under this chapter.

(June, 1969, P.A. 1, S. 10; June, 1971, P.A. 5, S. 110; P.A. 77-614, S. 139, 163, 610; P.A. 80-482, S. 17, 345, 348; P.A. 82-259, S. 2, 7; P.A. 90-134, S. 16, 28.)

History: 1971 act made provisions generally applicable by deleting references to specific years; P.A. 77-614 substituted commissioner of revenue services for tax commissioner, placed insurance commissioner within department of business regulation and made insurance department a division within said department, effective January 1, 1979; P.A. 80-482 substituted Sec. 38-53b for Sec. 38-51 and reinstated insurance division as independent department, deleting reference to abolished department of business regulation; P.A. 82-259 clarified language concerning provisions of chapter 207 applicable to hospital and medical service corporations; P.A. 90-134 excluded direct subscriber charges for special health care plans from consideration as part of net direct subscriber charges used to calculate rates.

Secs. 12-212b and 12-212c. Employee welfare benefit plans; definitions. Imposition of tax. Sections 12-212b and 12-212c are repealed.

(June, 1971, P.A. 8, S. 29, 30; 1972, P.A. 210, S. 1; P.A. 74-300, S. 1, 2; P.A. 77-614, S. 139, 610; P.A. 79-376, S. 17; P.A. 82-259, S. 3, 7; P.A. 86-72, S. 1, 2.)