CHAPTER 222. LIFE, HEALTH, AND ACCIDENT INSURANCE PREMIUM TAX
INSURANCE CODE
TITLE 3. DEPARTMENT FUNDS, FEES, AND TAXES
SUBTITLE B. INSURANCE PREMIUM TAXES
CHAPTER 222. LIFE, HEALTH, AND ACCIDENT INSURANCE PREMIUM TAX
Sec. 222.001. APPLICABILITY OF CHAPTER. (a) This chapter
applies to any insurer, including a group hospital service
corporation, any health maintenance organization, and any managed
care organization that receives gross premiums or revenues
subject to taxation under Section 222.002, including companies
operating under Chapter 841, 842, 843, 861, 881, 882, 883, 884,
941, 942, 982, or 984, Insurance Code, Chapter 533, Government
Code, or Title XIX of the federal Social Security Act.
(b) This chapter does not apply to:
(1) a fraternal benefit society, including a fraternal benefit
society operating under Chapter 885;
(2) a local mutual aid association operating under Chapter 886;
or
(3) a society that limits its membership to one occupation.
(c) For purposes of computing the tax imposed by this chapter, a
managed care organization is treated in the same manner as a
health maintenance organization.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 1, eff. April 1,
2005.
Amended by:
Acts 2005, 79th Leg., Ch.
728, Sec. 11.002(a), eff. September 1, 2005.
Sec. 222.002. TAX IMPOSED. (a) An annual tax is imposed on:
(1) each insurer that receives gross premiums subject to
taxation under this section; and
(2) each health maintenance organization that receives gross
revenues from the sale of health maintenance certificates or
contracts.
(b) Except as otherwise provided by this section, in determining
an insurer's taxable gross premiums or a health maintenance
organization's taxable gross revenues, the insurer or health
maintenance organization shall include the total gross amounts of
premiums, membership fees, assessments, dues, revenues, and other
considerations received by the insurer or health maintenance
organization in a calendar year from any kind of health
maintenance organization certificate or contract or insurance
policy or contract covering risks on individuals or groups
located in this state and arising from the business of a health
maintenance organization or the business of life insurance,
accident insurance, health insurance, life and accident
insurance, life and health insurance, health and accident
insurance, life, health, and accident insurance, including
variable life insurance, credit life insurance, and credit
accident and health insurance for profit or otherwise or for
mutual benefit or protection.
(c) The following are not included in determining an insurer's
taxable gross premiums or a health maintenance organization's
taxable gross revenues:
(1) returned premiums or revenues;
(2) dividends applied to purchase paid-up additions to insurance
or to shorten the endowment or premium payment period;
(3) premiums received from an insurer for reinsurance;
(4) premiums or revenues received from the treasury of the
United States for insurance or benefits contracted for by the
federal government in accordance with or in furtherance of Title
XVIII of the Social Security Act (42 U.S.C. Section 1395c et
seq.) and its subsequent amendments;
(5) premiums or revenues paid on group health, accident, and
life policies or contracts in which the group covered by the
policy or contract consists of a single nonprofit trust
established to provide coverage primarily for employees of:
(A) a municipality, county, or hospital district in this state;
or
(B) a county or municipal hospital, without regard to whether
the employees are employees of the county or municipality or of
an entity operating the hospital on behalf of the county or
municipality; or
(6) premiums or revenues excluded by another law of this state.
(d) For purposes of Subsection (c)(3), a stop-loss or excess
loss insurance policy issued to a health maintenance organization
is considered reinsurance. In determining an insurer's taxable
gross premiums or a health maintenance organization's taxable
gross revenues, an insurer or health maintenance organization is
not entitled to a deduction for premiums paid for reinsurance.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 1, eff. April 1,
2005.
Amended by:
Acts 2005, 79th Leg., Ch.
728, Sec. 11.002(b), eff. September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch.
932, Sec. 2, eff. June 15, 2007.
Sec. 222.003. TAX RATES. (a) Except as provided by Subsection
(b), the rate of the tax imposed by this chapter on an insurer is
1.75 percent of the insurer's taxable gross premiums received
during a calendar year.
(b) The rate of the tax imposed by this chapter on an insurer
that receives taxable gross premiums from the business of life
insurance is:
(1) 0.875 percent of the first $450,000 of taxable gross
premiums received during a calendar year from the business of
life insurance; and
(2) 1.75 percent of the remaining taxable gross premiums
received during that calendar year from the business of life
insurance.
(c) The rate of the tax imposed by this chapter on a health
maintenance organization is:
(1) 0.875 percent of the first $450,000 of taxable gross
revenues received during a calendar year for the issuance of
health maintenance certificates or contracts; and
(2) 1.75 percent of the remaining taxable gross revenues
received during that calendar year for the issuance of health
maintenance certificates or contracts.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 1, eff. April 1,
2005.
Sec. 222.004. TAX DUE DATES. (a) The total tax imposed by this
chapter is due and payable not later than:
(1) March 1 after the end of the calendar year for which the tax
is due;
(2) the date the annual statement for the insurer or health
maintenance organization is required to be filed with the
commissioner after the end of the calendar year for which the tax
is due; or
(3) another date prescribed by the comptroller.
(b) An insurer or health maintenance organization that had a net
tax liability for the previous calendar year of more than $1,000
shall make semiannual prepayments of tax on March 1 and August 1.
The tax paid on each date must be equal to 50 percent of the
total amount of tax the insurer or health maintenance
organization paid under this chapter for the previous calendar
year. If the insurer or health maintenance organization did not
pay a tax under this chapter during the previous calendar year,
the tax paid on each date must be equal to the tax that would be
owed on the aggregate of the taxable gross premiums or taxable
gross revenues for the two previous calendar quarters.
(c) The comptroller may refund any overpayment of taxes that
results from the semiannual prepayment system prescribed by this
section.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 1, eff. April 1,
2005.
Sec. 222.005. TAX REPORT. (a) An insurer or health maintenance
organization liable for the tax imposed by this chapter must file
annually with the comptroller a tax report on a form prescribed
by the comptroller.
(b) The tax report is due on the date the tax is due under
Section 222.004(a).
(c) The comptroller may require the insurer or health
maintenance organization to file any additional relevant
information that is reasonably necessary to verify the amount of
tax due.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 1, eff. April 1,
2005.
Sec. 222.006. CHANGE IN DUE DATES. (a) The comptroller by rule
may change the dates for reporting and paying taxes under this
chapter to improve operating efficiencies within the agency.
(b) A change by the comptroller in a reporting or payment date
must retain the system of semiannual prepayments prescribed by
Section 222.004.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 1, eff. April 1,
2005.
Sec. 222.007. CREDIT FOR FEES PAID. (a) Except as otherwise
provided by this subsection, an insurer or health maintenance
organization is entitled to a credit on the amount of tax due
under this chapter for all examination and evaluation fees paid
to this state during the calendar year for which the tax is due.
An insurer is not entitled to a credit on the amount of tax due
under this chapter for fees paid for valuing life insurance
policies. The limitations provided by Sections 803.007(1) and
(2)(B) for a domestic insurance company apply to a foreign
insurance company.
(b) The credit provided by this section is in addition to any
other credit authorized by statute.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 1, eff. April 1,
2005.
Amended by:
Acts 2005, 79th Leg., Ch.
728, Sec. 11.003(a), eff. September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch.
1039, Sec. 2, eff. September 1, 2007.
Sec. 222.008. FAILURE TO PAY TAXES. An insurer or health
maintenance organization that fails to pay all taxes imposed by
this chapter is subject to Section 203.002.
Added by Acts 2003, 78th Leg., ch. 1274, Sec. 1, eff. April 1,
2005.