2023 New York Laws › TAX - Tax › Article 33 - Franchise Taxes on Insurance Corporations › 1510 - Additional Franchise Tax on Insurance Corporations.

§  1510.  Additional  franchise  tax  on  insurance  corporations. (a)
Domestic, foreign and alien insurance corporations except life insurance
corporations.  Except  as  hereinafter  provided,  for   taxable   years
beginning  before  January  first,  two  thousand  three  every domestic
insurance corporation, every foreign  insurance  corporation  and  every
alien  insurance  corporation,  other than such corporations transacting
the business of life insurance, (1) authorized to transact  business  in
this  state  under a certificate of authority from the superintendent of
financial services or (2) which is a risk retention group as defined  in
subsection  (n)  of  section  five  thousand  nine  hundred  two  of the
insurance  law,  shall,  for  the  privilege  of  exercising   corporate
franchises  or  for  carrying  on  business  in a corporate or organized
capacity within this state, and in addition to any other  taxes  imposed
for  such privilege, pay a tax on all gross direct premiums, less return
premiums thereon, written on risks located or resident  in  this  state.
The  rate  of  tax  imposed  by this subdivision shall be two percent on
premiums  written  on  or  after   January   first,   nineteen   hundred
seventy-four  and  before  January first, nineteen hundred seventy-five,
one and nine-tenths percent on premiums  written  on  or  after  January
first,  nineteen hundred seventy-five and before January first, nineteen
hundred seventy-six, one and eight-tenths percent on premiums written on
or after January first, nineteen hundred seventy-six and before  January
first,  nineteen  hundred  seventy-eight,  one and two-tenths percent on
premiums  written  on  or  after   January   first,   nineteen   hundred
seventy-eight  and before January first, nineteen hundred ninety-two and
one and three-tenths percent on premiums written on and after such date.
Provided, however, that the rate of tax imposed by this  subdivision  on
all  gross  direct  premiums, less return premiums thereon, for accident
and health insurance contracts shall be one and six-tenths  percent  for
such  premiums  written  on  or  after  January  first, nineteen hundred
seventy-four and before January first, nineteen  hundred  seventy-eight,
and  one  percent  for  such premiums written on or after January first,
nineteen hundred seventy-eight.
(b) Domestic, foreign  and  alien  life  insurance  corporations.  (1)
Except   as   hereinafter   provided,   every  domestic  life  insurance
corporation, and every foreign  and  alien  life  insurance  corporation
authorized  to  transact  business  in this state under a certificate of
authority from the superintendent of financial services, shall, for  the
privilege of exercising corporate franchises or for carrying on business
in  a corporate or organized capacity within this state, and in addition
to any other taxes imposed for such privilege, pay a tax  on  all  gross
direct  premiums,  less  return  premiums  thereon,  received in cash or
otherwise on  risks  resident  in  this  state,  including  supplemental
contracts  for  total  and  permanent disability benefits and accidental
death benefits. The rate of such tax shall be  (i)  one  and  six-tenths
percent  on  such  premiums received on or after January first, nineteen
hundred  seventy-four  and  before  January  first,   nineteen   hundred
seventy-eight,  (ii)  one  percent on such premiums received on or after
January first, nineteen hundred seventy-eight and before January  first,
nineteen  hundred  eighty-seven,  (iii)  eight-tenths  percent  on  such
premiums  received  on  or  after  January   first,   nineteen   hundred
eighty-seven  and  before  January first, nineteen hundred ninety-eight,
and (iv) seven-tenths percent on such  premiums  received  on  or  after
January first, nineteen hundred ninety-eight.
(2)  Every  such  life  insurance  corporation  which  shall  obtain a
certificate of authority to transact business in this state or a renewal
of such certificate from the superintendent of financial services shall,
upon the expiration of such  certificate  for  any  cause  or  upon  its

ceasing  to  transact  new business in this state, continue to pay a tax
upon its business remaining in force in this state at the  rate  and  as
computed in this subdivision.
(c) Determination of direct premiums--general provisions. (1) The term
"premium"  includes  all amounts received as consideration for insurance
contracts, reinsurance contracts or contracts  with  health  maintenance
organizations for health services, other than for annuity contracts, and
shall  include  premium  deposits,  assessments, policy fees, membership
fees, any separate costs by carriers assessed upon  their  policyholders
and  every  other  compensation  for  such contract. In ascertaining the
amount of direct premiums upon which a tax is payable under this section
there shall be first determined the amount of total  gross  premiums  or
deposit  premiums or assessments, less returns thereon, on all policies,
certificates, renewals, policies subsequently cancelled,  insurance  and
reinsurance  executed,  issued or delivered on property or risks located
or resident in this state, including premiums for  reinsurance  assumed,
and  also including premiums written, procured or received in this state
on business which cannot specifically be allocated  or  apportioned  and
reported  as  taxable premiums or which have been used as a measure of a
tax on business of any other state or states. Provided however,  in  the
case  of special risk premiums, direct premiums shall include only those
premiums written, procured or received in  this  state  on  property  or
risks  located  or resident in this state. The reporting of premiums for
the purpose of the tax imposed by this section shall  be  on  a  written
basis  or  on a paid-for basis consistent with the basis required by the
annual statement filed with the  superintendent  of  financial  services
pursuant to section three hundred seven of the insurance law.
(2)  The  term "gross direct premiums," as used in this section, shall
not include premiums  for  policies  issued  pursuant  to  section  four
thousand  two  hundred  thirty-six of the insurance law and premiums for
insurance upon hulls, freights, or disbursements, or upon goods,  wares,
merchandise  and  all  other personal property and interests therein, in
the course  of  exportation  from,  importation  into  any  country,  or
transportation coastwise, including transportation by land or water from
point  of origin to final destination in respect to, appertaining to, or
in connection with, any and all risks or perils of  navigation,  transit
or  transportation,  and  while  being  prepared for, and while awaiting
shipment, and during any delays, storage,  transshipment  or  reshipment
incident  thereto,  including  war risks and marine builder's risks. The
term "gross direct premiums," as used in this section,  also  shall  not
include  any premiums that this state is prohibited from taxing pursuant
to federal law, including (i) subsection (f) of section 8909 of title  5
of  the  united  states code, (ii) subsection (g) of section 1395w-24 of
title 42 of the united states code,  (iii)  subsection  (g)  of  section
1395w-112  of  title 42 of the United States code, and (iv) subparagraph
(B) of paragraph (4) of subsection (k) of section 1395mm of title 42  of
the United States code.
(3) After determining the amount of total gross premiums, less returns
thereon, as hereinbefore provided, there shall be deducted the following
items:
(A)  Such  premiums,  less  return  premiums  thereon, which have been
received by way of  reinsurance  from  corporations  or  other  insurers
authorized to transact business in this state;
(B)  Such  premiums,  less  return  premiums  thereon, which have been
received by way of reinsurance from corporations or other  insurers  not
authorized  to  transact  business in this state to the extent that such
premiums relate to transactions (i) that are authorized by  section  two
thousand  one  hundred  five of the insurance law with respect to excess

line insurance, and (ii) with respect  to  which  sums  are  payable  by
licensed excess line brokers to the superintendent of financial services
pursuant  to  section two thousand one hundred eighteen of the insurance
law; and
(C)  Dividends on such direct business, including unused or unabsorbed
portions of premium deposits paid or credited to policyholders, but  not
including  deferred  dividends paid in cash to policyholders on maturing
policies, nor cash surrender values.
(4) In determining the amount  of  direct  premiums  taxable  in  this
state,  all  such  premiums  written, procured or received in this state
shall be deemed written on property or risks located or resident in this
state except such premiums as are properly allocated or apportioned  and
reported  as  taxable premiums or which have been used as a measure of a
tax of any other state or states,  provided  however,  in  the  case  of
special risk premiums, direct premiums shall include only those premiums
written, procured or received in this state on property or risks located
or resident in this state.
(e) Powers and duties of the superintendent of financial services.
(1)  The  superintendent of financial services shall, on behalf of the
commissioner, have the power, duty and responsibility to examine returns
of an insurance corporation filed with him pursuant to  section  fifteen
hundred  fifteen  and,  together  with  any other information within his
possession or that may  come  into  his  possession,  to  ascertain  the
correct  amount  of  tax  imposed  under  this  section of any insurance
corporation. For the purpose of ascertaining the correctness of any such
tax imposed under this section or for the purpose of making an  estimate
of  the  tax  liability under this section of any insurance corporation,
the superintendent shall have the power to  examine  or  cause  to  have
examined  by  any  agent  or  representative  designated by him for that
purpose, any books,  papers,  records  or  memoranda  bearing  upon  the
matters required to be included in the return.
(2)  If  the  superintendent of financial services ascertains that the
amount of tax imposed under this section as shown on the return  of  any
insurance corporation is less than the amount of tax disclosed by his or
her   examination,   he  or  she  shall  propose,  in  writing,  to  the
commissioner the issuance of a notice of deficiency for the amount  due.
If   an   insurance   corporation  fails  to  file  a  return  with  the
superintendent of financial services within the time  required  for  the
filing  of  such  return  (with  regard to any extension of time for the
filing thereof), the superintendent of financial services shall make  an
estimate  of  the  amount  of tax due for the period in respect to which
such insurance corporation failed to file the return. The estimate shall
be made from any available information which is in the possession or may
come into the possession of the superintendent of financial services and
he shall propose, in writing, to the  commissioner  the  issuance  of  a
notice  of deficiency for the amount of such estimated tax. Any proposal
pursuant to this paragraph shall set forth the  basis  thereof  and  the
details of its computation.
(3)  The  commissioner  shall,  on  receipt  of  a  proposal  from the
superintendent of financial services pursuant to paragraph two  of  this
subdivision, review such proposal and if satisfied as to the correctness
thereof  shall  take  appropriate  action  under  this  chapter  for the
assessment and collection of the amount of tax, together  with  interest
and  penalties,  either  shown  by  such proposal to be due or which the
commissioner ascertains to be due. The provisions  of  this  subdivision
shall not in any way be deemed to limit the power of the commissioner to
conduct  such  examination,  or  investigation  as it deems necessary in

order to carry out its duties with respect to the  taxes  imposed  under
this section.
(4) Subject to the consent of the superintendent of financial services
and  notwithstanding  any  other  provisions of law to the contrary, the
commissioner may delegate such other of his or  her  powers  and  duties
with  respect  to the administration and collection of the taxes imposed
under this section to the superintendent of financial services,  as  the
commissioner  finds necessary in order to facilitate such administration
and collection.