34 Tex. Admin. Code § 3.811 - Election by Reciprocal or Interinsurance Exchange Pursuant to Insurance Code, Chapter 224
(a) Reciprocal or
interinsurance exchanges authorized under Insurance Code, Chapter 942, are
subject to premium and maintenance taxes as are all other insurance carriers. A
reciprocal or interinsurance exchange is subject to the tax imposed under
Insurance Code, Chapter 224 unless it elects to be subject to the tax imposed
under Insurance Code, Chapter 221.
(1) To
make the election, a reciprocal or interinsurance exchange must submit a
statement in writing on a form prescribed by the comptroller making such an
election. The comptroller has developed form 25-208 for this purpose. This form
must be filed no later than the 31st day before the beginning of the tax year
for which the election is to be effective. For example, to be taxed under
Insurance Code, Chapter 221 for the 2012 tax year, the reciprocal or
interinsurance exchange must have filed this form by December 1,
2011.
(2) A reciprocal or
interinsurance exchange that elects to be taxed under Insurance Code, Chapter
221, will continue to be taxed under that article for each tax year until
written notice is given to the comptroller that the election is withdrawn. The
comptroller has developed form 25-208 for this purpose. The notice of
withdrawal must be filed with the comptroller not later than the 31st day
before the beginning of the tax year for which the withdrawal is to be
effective.
(3) Form 25-208 is
available on the comptroller's website at:
http://www.window.state.tx.us/taxinfo/taxforms/25-forms.html.
(b) If a reciprocal or
interinsurance exchange does not file an election as provided by this section
or has withdrawn the election, the reciprocal or interinsurance exchange is
subject to tax using the rate imposed under Insurance Code, Chapter
224.
(c) Insurance Code, Chapter
221, imposes an annual tax equal to 1.6% of the gross premium receipts of
licensed insurance carriers and reciprocal or interinsurance exchanges that
have filed an election to be taxed under this chapter.
(d) Insurance Code, Chapter 224, imposes an
annual tax equal to 1.7% of the gross premium receipts of each reciprocal or
interinsurance exchange that has not filed an election or that has withdrawn a
prior election to be taxed under Insurance Code, Chapter 221.
(e) Except as provided by subsection (d) of
this section, Insurance Code, Chapter 221 applies to the imposition,
computation, and administration of the tax imposed by Insurance Code, Chapter
224 in the same manner that Insurance Code, Chapter 221 applies to the tax
imposed by that Chapter.
(f)
Failure to file and pay taxes as provided under Insurance Code, Chapter 221 or
Chapter 224 will subject the taxpayer to penalty and interest under Tax Code,
Title 2, Subtitles A and B.
Notes
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