Instructions For Form 570 - Nonadmitted Insurance Tax Return printable pdf download

Instructions for Form 570

Nonadmitted Insurance Tax Return

References in these instructions are to the California Revenue and Taxation Code (R&TC) and the California Insurance Code.

General Information

E Interest on Refunds

Line 8 – Enter any payments made before filing the

return. If the return is being filed after the due date,

The FTB will compute any interest on refunds owed

see the instructions for line 11.

A Purpose

to you. If an amended return results in an overpay-

Line 10 – If the amount on line 5 is more than the

ment, interest will be allowed from the date of the

Use Form 570 to determine the tax on premiums

amount on line 9, subtract line 9 from line 5 and

overpayment.

paid or to be paid to nonadmitted insurers on con-

enter the balance on line 10. You have tax due. If

tracts covering risks in California. Also use Form 570

If an overpayment results from an excess of returned

the amount on line 9 is more than the amount on

to file an amended return.

premiums over premiums paid or to be paid during

line 5, subtract line 5 from line 9 and enter the result

the quarter, interest will be allowed if the overpay-

in brackets on line 10. Your credits exceed your tax.

B Who Must Pay Tax

ment is not credited to a succeeding quarter and the

Line 11 – If you fail to pay the tax due by the due

refund is not paid within 120 days after the claim for

The tax is imposed on any corporation, partnership,

date, a penalty of 10% of the amount of tax due will

refund is filed, or within 120 days after the due date

limited liability company, individual, bank, society,

be imposed. Enter 10% of the amount of tax not

of the return, whichever is later.

association, organization, governmental or quasi-

paid by the due date. (A penalty of 25% of the

governmental entity, joint stock company, estate or

F Amended Returns

amount of tax due will be imposed when nonpay-

trust, receiver, trustee, assignee, referee or any

ment or late payment is due to fraud.)

Use Form 570 to file an amended return. File an

other person acting in a fiduciary capacity who inde-

Line 12 – Interest will be charged on any late pay-

amended return only to correct an error on the

pendently purchases or renews an insurance con-

ment and penalty from the due date to the date paid.

original return.

tract during the calendar quarter from an insurer,

Interest compounds daily and the interest rate is

including wholly-owned subsidiaries, not authorized

Print ‘‘Amended Return’’ in red at the top of Side 1.

adjusted twice a year. If you do not include interest

to transact business in California.

Attach a copy of the original return behind the

with your payment or include only a portion of it, the

amended return and write ‘‘copy’’ across the face of

If you do not know if the insurer is authorized to

FTB will compute the interest and bill you for it.

the original return. When completing line 1 through

conduct business in California, call the Franchise

Line 13 – Enter the total amount due. Make your

line 18 of the amended return, use the amounts that

Tax Board (FTB) Nonadmitted Insurance Desk at

check or money order payable to the ‘‘Franchise Tax

should have been reported on the original return.

(916) 845-4098.

Board.’’ Be sure to write the calendar quarter

Amended returns must be filed within four years of

The tax will not be imposed on:

(March, June, September or December),

•

the original due date or within one year from the

Insurance coverage for which a tax on the gross

‘‘19

Form 570’’ and your social security num-

date of the overpayment, whichever period expires

ber, California corporation number or FEIN on your

premium is due or has been paid by surplus line

later.

check.

brokers pursuant to Insurance Code Sec-

Note: Do not file an amended return to claim

tion 1775.5 (surplus lines tax);

Line 15 – Enter the amount of overpayment to be

•

returned premiums. See the instructions for line 6.

Gross premiums on businesses governed by

credited to your next return.

provisions of Insurance Code Section 1760.5

Part II Allocation

Specific Line Instructions

(reinsurance of the liability of an admitted insurer

and marine, aircraft and interstate railroad

Line 17 – Enter the total premiums paid or to be

insurance); or

Part I Tax Computation

paid on contracts covering risks located within and

•

outside of California for contracts entered into or

Insurance coverage for which a tax on the gross

Note: Do not show net or negative amounts on

renewed during the calendar quarter.

premium is due or has been paid by risk reten-

line 1 through line 5 to account for returned premi-

tion groups pursuant to Insurance Code

Line 18 – Enter the amount of premiums on line 17

ums. See line 6 for returned premiums. Only use

Section 132.

allocated to California. You must attach a schedule

line 1 through line 5 to report taxable premiums paid

showing how you determined the allocation. Include

Note: Agents or brokers filing a return on behalf of

or to be paid during the calendar quarter.

the method used for the allocation (such as property

the insured, enter the requested information in the

Line 1 – Enter premiums paid or to be paid to a

blank space below line 18.

value, sales or number of employees).

nonadmitted insurer on risks located entirely within

The amount of the premium allocated to California is

California for contracts entered into or renewed

C Tax Rate

determined by the proportion that the risk in Califor-

during the calendar quarter.

nia bears to the total risk. Use any single standard

The tax rate is 3%. This rate is applied to the gross

Line 2 – Complete Part II and enter the amount from

rating method in use in all states or countries where

premium paid or to be paid, less premiums returned

line 18.

the insurance applies or, with prior approval of the

because of cancellation or reduction of premium on

Line 6 – Enter 3% of the premiums returned during

FTB, any other reasonable basis.

which a tax has been paid. Do not include a

the calendar quarter because of cancellation or

stamping fee.

Allocate each contract individually if more than one

reduction of premiums on which nonadmitted

contract was entered into or renewed during the

insurance tax was paid.

D When and Where to File

calendar quarter.

Enter the quarter that the returned premiums were

File Form 570 on or before the first day of the third

Enter this amount on Part II, line 18 and Part I,

originally taxed. If the returned premiums are from

month following the close of any calendar quarter

line 2.

more than one quarter, attach a schedule showing

during which a nonadmitted insurance contract took

For more information regarding allocation, or if you

the amount of returned premiums from each quarter.

effect or was renewed:

have questions, contact the FTB Nonadmitted

Returned premiums must be claimed on a return for

Contract effective date

Return due date

Insurance Desk at (916) 845-4098.

the calendar quarter during which the returned pre-

January-March

June 1

miums were received. Refunds resulting from

April-June

September 1

returned premiums must be claimed within four years

July-September

December 1

from the date of cancellation or reduction of

October-December

March 1

premium.

Note: If you are an agent or broker filing this return

Mail Form 570 and payment to:

on behalf of the insured, the refund will be paid to

FRANCHISE TAX BOARD

the insured unless a signed power of attorney from

PO BOX 942867

the insured is attached to the return instructing the

SACRAMENTO CA 94267-0001

refund to be sent to the agent or broker.

Side 2

Form 570

(REV. 1998)

Instructions For Form 570 - Nonadmitted Insurance Tax Return

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