AN ACT TO AMEND TITLE 18 OF THE DELAWARE CODE RELATING TO TAXES.

Plain English Breakdown

The official source does not specify an effective date, only that it becomes effective upon signature or a specified date.

Fixing Tax Payment Dates for Insurance Companies

This law fixes a problem in the tax rules for certain insurance companies by making sure they pay their taxes at the right times.

What This Bill Does

• Changes when captive insurance companies and surplus lines brokers must pay their taxes.
• Makes sure these companies follow Sections 1917 and 6914 of the Insurance Code about tax amounts and payment dates.

Who It Names or Affects

• Captive insurance companies
• Surplus lines brokers

Terms To Know

captive insurance company

A type of insurance company that only provides insurance for one specific group or company.

surplus lines broker

An agent who helps find insurance when it's not available from standard companies.

Limits and Unknowns

• Doesn't change how much tax these companies pay.
• Only fixes the timing of payments, not other parts of the tax rules.
• The exact date this law starts working is not clear yet.

Official Summary Text

AN ACT TO AMEND TITLE 18 OF THE DELAWARE CODE RELATING TO TAXES.
This bill resolves an internal inconsistency in the Insurance Code regarding the timing of payment of taxes for captive insurance companies and surplus lines brokers. Sections 1917 and 6914 of the Insurance Code specifically address the amount and timing of taxes due for surplus lines brokers and captive insurance companies, respectively. Surplus lines brokers and captive insurance companies will continue to pay premium taxes in accordance with Sections 1917 and 6914, respectively, as they have historically.

Current Bill Text

Legislation Document

SPONSOR:

Rep. Bush & Sen. Mantzavinos

Sens. Poore, Walsh

HOUSE OF REPRESENTATIVES

153rd GENERAL ASSEMBLY

HOUSE BILL NO. 7

AN ACT TO AMEND TITLE 18 OF THE DELAWARE CODE RELATING TO TAXES.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:

Section 1. Amend § 702, Title 18 of the Delaware Code by making deletions as shown by strike through and insertions as shown by underline as follows:

§ 702. General premium tax; underwriting profits tax.

(d) The taxes imposed under this section and §§ 703, 704,

707, 1917 and 6914

and 707

of this title shall be payable as follows:

Fifty percent of the estimated tax liability for the current year shall be paid on April 15 of the current year, and the balance of the estimated tax shall be paid in installments as follows: 20% on June 15 of the current taxable year; 20% on September 15 of the current taxable year; 10% on December 15 of the current taxable year; and the remaining balance to be paid on March 1 of the following year.

SYNOPSIS

This bill resolves an internal inconsistency in the Insurance Code regarding the timing of payment of taxes for captive insurance companies and surplus lines brokers. Sections 1917 and 6914 of the Insurance Code specifically address the amount and timing of taxes due for surplus lines brokers and captive insurance companies, respectively. Surplus lines brokers and captive insurance companies will continue to pay premium taxes in accordance with Sections 1917 and 6914, respectively, as they have historically.