CHAPTER 432
INSURANCE COMPANIES TAX

  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.
[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]
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 
Taxation of organized delivery systems; see §135.120 

  432.2  Mutual service corporations.
  Notwithstanding section 432.1, a hospital service corporation, medical service corporation, pharmaceutical service corporation, optometric service corporation, and any other service corporation operating under chapter 514 shall pay as taxes to the director of revenue an amount equal to the applicable percent, as provided in section 432.1, subsection 2, of the gross amount of payments received during the preceding calendar year for subscriber contracts covering residents in this state after deducting the amounts returned to subscribers upon canceled subscriber contracts and rejected applications. Section 432.1, subsections 5 and 6, apply to the tax imposed by this section.
85 Acts, ch 239, §1; 2002 Acts, ch 1158, §7; 2003 Acts, ch 145, §286
Referred to in 

  432.3  Receipts — certificate of authority.
  At the time of filing the annual tax return and the final payment of said taxes, said companies and associations shall take duplicate receipts therefor, one of which shall be filed with the commissioner of insurance, and upon filing of said receipt, and not until then, the commissioner of insurance shall issue the annual certificate as provided by law.
[C73, §807; C97, §1333; S13, §1333; C24, 27, 31, 35, 39, §7023; C46, 50, 54, 58, 62, 66, 71, 73, 75, 77, 79, 81, §432.3; 81 Acts, ch 142, §2]

  432.4  Deduction for debts.
  No deduction or exemption from the taxes herein provided shall be allowed for or on account of any indebtedness owing by any such insurance company or association; provided, however, that companies doing a fire insurance business may deduct from the gross amount of premiums received, the amount of premiums returned upon canceled policies issued upon property situated in this state.
[C97, §1333; S13, §1333; C24, 27, 31, 35, 39, §7024; C46, 50, 54, 58, 62, 66, 71, 73, 75, 77, 79, 81, §432.4]

  432.5  Risk retention groups.
  A risk retention group organized and operating pursuant to Pub. L. No. 99-563, also known as the Risk Retention Amendments of 1986, shall pay as taxes to the director of revenue an amount equal to the applicable percent, as provided in section 432.1, subsection 4, of the gross amount of the premiums written during the previous calendar year for risks placed in this state. A resident or nonresident producer shall report and pay the taxes on the premiums for risks that the producer has placed in this state with or on behalf of a risk retention group. The failure of a risk retention group to pay the tax imposed in this section shall result in the risk retention group being considered an unauthorized insurer under chapter 507A.
87 Acts, ch 138, §1; 2003 Acts, ch 145, §286; 2004 Acts, ch 1110, §4; 2006 Acts, ch 1117, §4
Referred to in 

  432.6  Personal and real property.
  Every insurance corporation or association organized under the laws of this state, not including corporations with capital stock, county mutuals, and fraternal beneficiary associations, which county mutuals and fraternal beneficiary associations are not organized for pecuniary profit, shall, on or before the twenty-sixth day of January in each year, for the purpose of assessment of its property, furnish to the assessor of the assessment district in which its principal place of business is located, a statement verified by its president, showing specifically with reference to the year next preceding the first day of January then last past:
  1.  A duplicate of the statement required by law to be made to the commissioner of insurance for the said year last past.
  2.  A detailed statement of all its property and assets of every kind and nature whatsoever, and the value of each item thereof, including surplus, guaranty, and reserve fund, and the amount of each.
[S13, §1333-b; C24, 27, 31, 35, 39, §7027; C46, 50, 54, 58, 62, 66, 71, 73, 75, 77, 79, 81, §432.6]
Referred to in 

  432.7  Assessment.
  The assessor shall, upon the receipt of the statements, and from other information acquired by the assessor, assess against every corporation or association referred to in section 432.6, the actual value of each parcel of real estate situated in the assessment district of the assessor, and all the property shall be assessed at the same rate, and for the same purposes as the property of private individuals, as provided in section 441.21.
[S13, §1333-b; C24, 27, 31, 35, 39, §7028; C46, 50, 54, 58, 62, 66, 71, 73, 75, 77, 79, 81, §432.7]
89 Acts, ch 296, §58
  432.8  Repealed by 72 Acts, ch 1019, §  7. 

  432.9  Debts deductible.
  In ascertaining the indebtedness or liability of such corporation, company, or association, a debt shall be deemed to exist on account of its liability on the policies, certificates or other contracts of insurance issued by it equal to the amount of the surplus or other funds accumulated by any such corporation or association for the purpose of fulfilling its policies, certificates, or other contracts of insurance, and which can be used for no other purpose.
[S13, §1333-c; C24, 27, 31, 35, 39, §7030; C46, 50, 54, 58, 62, 66, 71, 73, 75, 77, 79, 81, §432.9]

  432.10  Sufficiency of remitted tax — notice.
  The commissioner of insurance shall determine whether or not the tax remitted is correct. If the tax remitted is not sufficient, the commissioner shall notify the delinquent company of the amount of such delinquency and certify the amount thereof to the department of revenue which shall proceed to collect such delinquency.
[C71, 73, 75, 77, 79, 81, §432.10]
2003 Acts, ch 145, §286
  432.11  Repealed by 2002 Acts, ch 1119, §  111. 

  432.12  Repealed by 2001 Acts, ch 69, §  38, 39. 

  432.12A  Historic preservation and cultural and entertainment district tax credit.
  1.  The tax imposed under this chapter shall be reduced by a historic preservation and cultural and entertainment district tax credit equal to the amount as computed under chapter 404A for rehabilitating eligible property. Any credit in excess of the tax liability shall be refunded or credited to the following year, as provided in section 404A.4, subsection 3.
  2.  For purposes of this section, “eligible property” means the same as used in section 404A.1.
2002 Acts, ch 1003, §4, 5; 2007 Acts, ch 165, §7, 9
2007 amendment to subsection 1 applies to historic preservation and cultural and entertainment district tax credits applied for or reserved prior to July 1, 2007; 2007 Acts, ch 165, §9 

  432.12B  Venture capital fund investment tax credit.  Repealed by 2010 Acts, ch 1138, §  25, 26.
Tax credit certificates issued for future tax years for investments made on or before July 1, 2010, under former section 432.12B are valid and may be claimed by a taxpayer after July 1, 2010, in the tax year stated on the certificate; 2010 Acts, ch 1138, §26

  432.12C  Investment tax credits.
  1.  The tax imposed under this chapter shall be reduced by an investment tax credit authorized pursuant to section 15E.43 for an investment in a qualifying business or a community-based seed capital fund.
  2.  The taxes imposed under this division shall be reduced by investment tax credits authorized pursuant to sections 15.333A and 15E.193B, subsection 6.
2002 Acts, ch 1006, §10, 13; 2006 Acts, ch 1158, §60

  432.12D  Endow Iowa tax credit.
  The tax imposed under this chapter shall be reduced by an endow Iowa tax credit authorized pursuant to section 15E.305.
2003 Acts, 1st Ex, ch 2, §87, 89

  432.12E  Tax credits for wind energy production and renewable energy.
  The taxes imposed under this chapter shall be reduced by tax credits for wind energy production allowed under chapter 476B and for renewable energy allowed under chapter 476C.
2004 Acts, ch 1175, §407, 418; 2005 Acts, ch 160, §5, 14

  432.12F  Economic development region revolving fund contribution tax credits.  Repealed by 2010 Acts, ch 1138, §  15, 16.
2010 amendment repealing section applies retroactively to tax years beginning on or after January 1, 2010; 2010 Acts, ch 1138, § 16
  432.12G  Wage-benefits tax credit.  Repealed by 2008 Acts, ch 1191, §  167. 

  432.12H  Tax credit for certain sales taxes paid by third-party developers.
  The taxes imposed under this chapter shall be reduced by a tax credit authorized pursuant to section 15.331C for certain sales taxes paid by a third-party developer.
2006 Acts, ch 1158, §61

  432.12I  Iowa fund of funds tax credit.
  The taxes imposed under this chapter shall be reduced by a tax credit authorized pursuant to section 15E.66, if redeemed, for investments in the Iowa fund of funds.
2006 Acts, ch 1158, §62

  432.12J  Film qualified expenditure tax credit.
  The tax imposed under this chapter shall be reduced by a qualified expenditure tax credit authorized pursuant to section 15.393, subsection 2, paragraph “a”.
2007 Acts, ch 162, §10, 13
Section takes effect May 17, 2007, and applies retroactively to tax years beginning on or after January 1, 2007; 2007 Acts, ch 162, §13 

  432.12K  Film investment tax credit.
  The tax imposed under this chapter shall be reduced by an investment tax credit authorized pursuant to section 15.393, subsection 2, paragraph “b”.
2007 Acts, ch 162, §11, 13
Section takes effect May 17, 2007, and applies retroactively to tax years beginning on or after January 1, 2007; 2007 Acts, ch 162, §13 

  432.12L  Redevelopment tax credit.
  The taxes imposed under this chapter shall be reduced by a redevelopment tax credit allowed under chapter 15, subchapter II, part 9.
2008 Acts, ch 1173, §11; 2009 Acts, ch 41, §129

  432.12M  Innovation fund investment tax credit.
  The taxes imposed under this chapter shall be reduced by an innovation fund investment tax credit allowed under section 15E.52.
2011 Acts, ch 130, §44, 47, 71
Section applies retroactively to January 1, 2011, for tax years beginning and investments made on or after that date; 2011 Acts, ch 130, §47
NEW section

  432.13  Premium tax exemption — hawk-i program — state employee benefits.
  Premiums collected by participating insurers under chapter 514I are exempt from premium tax.
  Premiums received for benefits acquired by the department of administrative services on behalf of state employees pursuant to section 8A.402, subsection 1, are exempt from premium tax.
98 Acts, ch 1196, §1, 16; 99 Acts, ch 200, §19, 23; 2003 Acts, ch 145, §259

  432.14  Statute of limitations.
  Within five years after the tax return is filed or within five years after the tax return became due, whichever is later, the commissioner of insurance shall examine the return and determine the tax. An assessment or a claim for credit must be made within five calendar years after the annual tax filing is made. For a five-year period preceding the current calendar year, a company may apply for a credit, or the commissioner may make an assessment, as appropriate. The period of examination and determination of the correct amount of tax is unlimited in the case of a false or fraudulent return made with the intent to evade tax or in the case of a failure to file a return.
98 Acts, ch 1057, §1