432.1 - TAX ON GROSS PREMIUMS -- EXCLUSIONS.

        432.1  TAX ON GROSS PREMIUMS -- EXCLUSIONS.         Every insurance company or association of whatever kind or      character, not including fraternal beneficiary associations, and      nonprofit hospital and medical service corporations, shall, as      required by law, pay to the director of the department of revenue, or      to a depository designated by the director, as taxes, an amount equal      to the following, except that the premium tax applicable to county      mutual insurance associations shall be governed by section 518.18:         1. a.  The applicable percent, as provided in subsection 2, of      the gross amount of premiums received during the preceding calendar      year by every life insurance company or association, not including      fraternal beneficiary associations, or the gross payments or deposits      collected from holders of fraternal beneficiary association      certificates, on contracts of insurance covering risks resident in      this state during the preceding year, including contracts for group      insurance and annuities and without including or deducting any      amounts received or paid for reinsurance.         b.  In determining the gross amount of premiums to be taxed      hereunder, there shall be excluded all premiums received from      policies or contracts issued in connection with a pension, annuity,      profit-sharing plan or individual retirement annuity qualified or      exempt under sections 401, 403, 404, 408 or 501(a) of the federal      Internal Revenue Code as now or hereafter amended and all premiums      returned to policyholders or annuitants during the preceding calendar      year, except cash surrender values, all dividends that, during said      year, have been paid in cash or applied in reduction of premiums or      left to accumulate to the credit of policyholders or annuitants.         c.  In determining the gross amount of premiums to be taxed,      there shall be excluded all consideration received in connection with      an annuity contract, whether or not such contract is qualified or      exempt under the federal Internal Revenue Code as now or hereafter      amended, and all premiums returned to policyholders or annuitants      during the preceding calendar year, except cash surrender values, and      all dividends that, during said year, have been paid in cash or      applied in reduction of premiums or left to accumulate to the credit      of policyholders or annuitants.         2.  The "applicable percent" for purposes of subsection 1 of      this section and section 432.2 is the following:         a.  For calendar years beginning before the 2003 calendar      year, two percent.         b.  For the 2003 calendar year, one and three-fourths percent.         c.  For the 2004 calendar year, one and one-half percent.         d.  For the 2005 calendar year, one and one-fourth percent.         e.  For the 2006 and subsequent calendar years, one percent.         3.  The applicable percent, as provided in subsection 4, of the      gross amount of premiums written, and assessments and fees received      during the preceding calendar year by every company or association      other than life on contracts of insurance other than life for      business done in this state, including all insurance upon property      situated in this state, after deducting the amounts returned upon      canceled policies, certificates, and rejected applications but not      including the gross premiums written, and assessments and fees      received in connection with ocean marine insurance authorized in      section 515.48.         4.  The "applicable percent" for purposes of subsection 3 is      the following:         a.  For calendar years beginning before the 2004 calendar      year, two percent.         b.  For the 2004 calendar year, one and three-fourths percent.         c.  For the 2005 calendar year, one and one-half percent.         d.  For the 2006 calendar year, one and one-fourth percent.         e.  For the 2007 and subsequent calendar years, one percent.         5.  Except as provided in subsection 6, the premium tax shall be      paid on or before March 1 of the year following the calendar year for      which the tax is due.  The commissioner may suspend or revoke the      license of a company or association that fails to pay its premium tax      on or before the due date.         6. a.  Each insurance company and association transacting      business in this state whose Iowa premium tax liability for the      preceding calendar year was one thousand dollars or more shall remit      on or before June 1, on a prepayment basis, an amount equal to      one-half of the premium tax liability for the preceding calendar      year.         b.  In addition to the prepayment amount in paragraph "a",      each life insurance company or association which is subject to tax      under subsection 1 of this section and each mutual health service      corporation which is subject to tax under section 432.2 shall remit      on or before August 15, on a prepayment basis, an additional amount      equal to the following percent of the premium tax liability for the      preceding calendar year as follows:         (1)  For prepayment in the 2003 calendar year, four percent.         (2)  For prepayment in the 2004 calendar year, twenty-one percent.         (3)  For prepayment in the 2005 and subsequent calendar years,      fifty percent.         c.  In addition to the prepayment amount in paragraph "a",      each insurance company or association, other than a life insurance      company or association, which is subject to tax under subsection 3      shall remit on or before August 15, on a prepayment basis, an      additional amount equal to the following percent of the premium tax      liability for the preceding calendar year as follows:         (1)  For prepayment in the 2003 and 2004 calendar years, eleven      percent.         (2)  For prepayment in the 2005 calendar year, twenty-six percent.         (3)  For prepayment in the 2006 and subsequent calendar years,      fifty percent.         d.  The sums prepaid by a company or association under this      subsection shall be allowed as credits against its premium tax      liability for the calendar year during which the payments are made.      If a prepayment made under this subsection exceeds the annual premium      tax liability, the excess shall be allowed as a credit against      subsequent prepayment or tax liabilities.  The commissioner of      insurance shall authorize the department of revenue to make a cash      refund to an insurer, in lieu of a credit against subsequent      prepayment or tax liabilities, if the insurer demonstrates the      inability to recoup the funds paid via a credit.  The commissioner      shall adopt rules establishing eligibility criteria for such a refund      and a refund process.  The commissioner may suspend or revoke the      license of a company or association that fails to make a prepayment      on or before the due date.  
         Section History: Early Form
         [C51, § 464; R60, § 718; C73, § 807; C97, § 1333; S13, § 1333,      1333-d; C24, 27, 31, 35, 39, § 7021, 7022, 7025; C46, 50, 54, 58,      62, 66, 71, 73, 75, 77, 79, 81, § 432.1; 81 Acts, ch 142, § 1; 82      Acts, ch 1231, § 1] 
         Section History: Recent Form
         88 Acts, ch 1159, § 1; 2002 Acts, ch 1119, §169; 2002 Acts, ch      1158, §2--6; 2003 Acts, ch 108, §73; 2003 Acts, ch 145, §286; 2004      Acts, ch 1175, §337, 338, 348; 2005 Acts, ch 70, §2; 2006 Acts, ch      1117, §3; 2007 Acts, ch 137, §2         Referred to in § 87.4, 135.120, 432.2, 432.5, 432A.9, 507A.4,      507A.9, 514B.31, 515.24, 518.18, 518A.35, 520.19         Taxation of organized delivery systems; see § 135.120