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91_SB0338eng SB338 Engrossed LRB9102972JSpr 1 AN ACT concerning refunds of insurance premium taxes. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 5. The State Finance Act is amended by adding 5 Section 5.490 as follows: 6 (30 ILCS 105/5.490 new) 7 Sec. 5.490. The Insurance Premium Tax Refund Fund. 8 Section 10. The Illinois Insurance Code is amended by 9 changing Section 412 as follows: 10 (215 ILCS 5/412) (from Ch. 73, par. 1024) 11 Sec. 412. Refunds; penalties; collection. 12 (1) Whenever it appears to the satisfaction of the 13 Director that because of some mistake of fact, error in 14 calculation, or erroneous interpretation of a statute of this 15 or any other state, any authorized company has paid to him, 16 pursuant to any provision of law, taxes, fees, or other 17 charges, including interest, in excess of the amount legally 18 chargeable against it, during the 6 year period immediately 19 preceding the discovery of such overpayment, he shall have 20 power to refund to such company the amount of the excess or 21 excesses by applying the amount or amounts thereof toward the 22 payment of taxes, fees, or other charges already due and 23 shall refund the balance to the company, or which may24thereafter become due from that company until such excess or25excesses have been fully refunded, or, at his discretion, to26make a cash refund. 27 Amounts determined by the taxpayer or the Department to 28 be an overpayment of a tax may, at the taxpayer's election, 29 be credited against the estimated tax for any taxable year. SB338 Engrossed -2- LRB9102972JSpr 1 For overpayments of taxes paid on or after January 1, 2 1999, interest shall be allowed and paid by the Department to 3 taxpayers at the rate prescribed under subsection (4) for 4 deficiencies in tax payments. No interest shall be paid upon 5 an overpayment of tax if the overpayment is refunded or a 6 credit is approved within 90 days after the last date 7 prescribed for filing the original return, within 90 days 8 after the receipt of the return, or within 90 days after the 9 date of overpayment, whichever date is latest. Interest on 10 amounts refunded or credited pursuant to the filing of an 11 amended return or claim for refund shall be determined from 12 the due date of the original return or the date of 13 overpayment, whichever is later, to the date of payment by 14 the Department. 15 A claim for refund shall be filed with the Department in 16 writing and shall state the specific grounds upon which it is 17 founded before the expiration of the applicable limitation 18 period specified in this subsection or before the expiration 19 of 6 months after a jeopardy or deficiency determination 20 becomes final, whichever period expires later. If the tax 21 return reflects an overpayment or credits in excess of the 22 tax, the declaration of that fact on the return constitutes a 23 claim for refund. If the Department agrees the claim is 24 valid, the amount of overpayment, penalties, and interest 25 shall be first applied to any known liability, and the 26 excess, if any, shall be refunded to the taxpayer or, at the 27 taxpayer's request, credited against any current or 28 subsequent tax liability. Refunded amounts shall be paid 29 only if and to the extent that (i) the amounts exceed $100 30 and (ii) the amounts cannot be fully offset against the 31 taxpayer's next prepayment of tax. Refunds shall be paid from 32 the Insurance Premium Tax Refund Fund, a special Fund hereby 33 created in the State treasury. 34 (2) When any insurance company or any surplus line SB338 Engrossed -3- LRB9102972JSpr 1 producer fails to file any tax return required under Sections 2 408.1, 409, 444, 444.1 and 445 of this Code or Section 12 of 3 the Fire Investigation Act on the date prescribed, including 4 any extensions, there shall be added as a penalty $200 or 5% 5 of the amount of such tax, whichever is greater, for each 6 month or part of a month of failure to file, the entire 7 penalty not to exceed $1,000 or 25% of the tax due, whichever 8 is greater. 9 (3) (a) When any insurance company or any surplus line 10 producer fails to pay the full amount due under the 11 provisions of this Section, Sections 408.1, 409, 444, 444.1 12 or 445 of this Code, or Section 12 of the Fire Investigation 13 Act, there shall be added to the amount due as a penalty an 14 amount equal to 5% of the deficiency. 15 (b) If such failure to pay is determined by the Director 16 to be wilful, after a hearing under Sections 402 and 403, 17 there shall be added to the tax as a penalty an amount equal 18 to the greater of 25% of the deficiency or 5% of the amount 19 due and unpaid for each month or part of a month that the 20 deficiency remains unpaid commencing with the date that the 21 amount becomes due. Such amount shall be in lieu of any 22 determined under paragraph (a). 23 (4) Any insurance company or any surplus line producer 24 which fails to pay the full amount due under this Section or 25 Sections 408.1, 409, 444, 444.1 or 445 of this Code, or 26 Section 12 of the Fire Investigation Act is liable, in 27 addition to the tax and any penalties, for interest on such 28 deficiency at the rate of 12% per annum, or at such higher 29 adjusted rates as are or may be established under subsection 30 (b) of Section 6621 of the Internal Revenue Code, from the 31 date that payment of any such tax was due, determined without 32 regard to any extensions, to the date of payment of such 33 amount. 34 (5) The Director, through the Attorney General, may SB338 Engrossed -4- LRB9102972JSpr 1 institute an action in the name of the People of the State of 2 Illinois, in any court of competent jurisdiction, for the 3 recovery of the amount of such taxes, fees, and penalties 4 due, and prosecute the same to final judgment, and take such 5 steps as are necessary to collect the same. 6 (6) In the event that the certificate of authority of a 7 foreign or alien company is revoked for any cause or the 8 company withdraws from this State prior to the renewal date 9 of the certificate of authority as provided in Section 114, 10 the company may recover the amount of any such tax paid in 11 advance. Except as provided in this subsection, no revocation 12 or withdrawal excuses payment of or constitutes grounds for 13 the recovery of any taxes or penalties imposed by this Code. 14 (7) When an insurance company or domestic affiliated 15 group fails to pay the full amount of any fee of $100 or more 16 due under Section 408 of this Code, there shall be added to 17 the amount due as a penalty the greater of $50 or an amount 18 equal to 5% of the deficiency for each month or part of a 19 month that the deficiency remains unpaid. 20 (Source: P.A. 87-108.)