Instructions For Massachusetts Premium Excise Return For Insurance Companies Form 63-23p

the addition to tax under this provision. For more information see TIR

This credit is effective for tax years in which the aggregate cumulative

10-11.

investment in the Property and Casualty Initiative reaches 100 million

or the tax year 2004, whichever is later.

Line 7: Other Premiums. Taxpayers receiving disbursement checks

from the Massachusetts Property Insurance Underwriters Association

Line 24: Credit for member insurers of the Massachusetts Life and

in January 2016 must place the premiums associated with the check

Health Insurance Guaranty Association. Enter 10% of the assess-

on line 7. For example, if the taxpayer receives a disbursement check

ment for each of five years following the year in which the assessment

for $100, the Department would expect the taxpayer to report premi-

was paid. If the sum of offsets exceeds $3,000,000, the excess may

ums of $4,386 on line 7. If the taxpayer has included FAIR Plan premi-

be carried forward and may be used in a year in which the $3,000,000

ums on their Schedule T, they must include a letter stating (1) the

is not exceeded. If the total offsets exceed $3,000,000 in a year, the

amount of the disbursement check and (2) the amount of allocated pre-

Department of Revenue will assess each member with an additional

miums that were included on Schedule T.

tax equal to the amount of the offset which exceeds $3,000,000 of such

members pro rata share. If the total offsets do not exceed $3,000,000

Line 9: Deduction. Enter the total of dividend deductions for

in a year, the Department of Revenue will calculate each members’ pro

pre miums returned or credited to policyholders in Mass. as dividends

rata share to determine the amount of refund due each member and

on direct business from Schedule T of the NAIC Annual Statement.

issue a refund to each member.

Line 12: Retaliatory tax. Use Part 3 of Form 63-23P to calculate your

Line 37: Voluntary Contribution to the Nongame Wildlife Fund. Any

excise using the same method and rate used by the state in which you

corporation that wishes to contribute any amount to the Natural Her-

are incorporated and would be imposed on a like Massachusetts in-

itage and Endangered Species Fund may do so on this form. This

surance company, or its agents, if doing business to the same extent.

amount is added to the excise due. It increases the amount of the cor -

If the computation in the state of your incorporation is in every respect

poration’s payment or reduces the amount of its refund.

the same as your Massachusetts computation, a statement to that ef-

fect should be made. Enter this amount in line 12. Retaliatory tax pro-

The Natural Heritage and Endangered Species Fund is administered

visions are provided under M.G.L. Ch. 63, secs. 23 and 24A.

by the Department of Fisheries, Wildlife and Environmental Law En-

forcement to provide for conservation programs for rare, endangered

Line 21: Retaliatory surtax credit. A company that contributes its full

and nongame wildlife and plants in the Commonwealth.

and proportionate share to the Property and Casualty Initiative may re-

ceive a credit against the premium tax equal to increasing percentages

Line 42: Pass-through Entity Withholding. Enter the amount of any

of the retaliatory taxes paid during the preceding taxable year attribut-

withholding tax from pass-through entities. Be sure to include the tax -

able to the surtax. If the aggregate cumulative investment by domestic

payer identification number of the person or entity submitting the with-

property and casualty companies in the Property and Casu alty Initiative

holding payment on behalf of the taxpayer.

reaches $100,000,000, the credit shall equal 100% of the retaliatory

Lines 39 through 49: Payments. Enter in line 39 any overpayment

taxes attributable to the surcharge. The amount of the credit is 20% for

credited from 2015 to 2016. Enter estimated tax payments made in

the tax year beginning on or after January 1, 1999 or the first year in

2016 in line 40. Any extension payment should be entered in line 41.

which a participating property and casualty company contributes its

Line 49 should reflect the total payments made for the entire year.

full proportionate share. The amount of the credit is 40% for the tax

Lines 50 through 52: Overpayment and refund. If the amount in

year beginning on or after January 1, 2000 or the second year in which

a participating property and casualty company contrib utes its full pro-

line 49 is larger than the amount in line 38, enter the amount overpaid

in line 50.

portionate share. The amount of credit is 60% for the tax year beginning

on or after January 1, 2001 or the third year in which the participating

The overpayment may be applied in part or in full to 2016 estimated

property and casualty company contributes its full pro portionate share.

taxes by entering in line 51 the amount to be credited to 2016 estimated

The amount of credit is 80% for the tax year beginning on or after Jan-

tax payments. Enter the amount to be refunded in line 50.

uary 1, 2002 or the fourth year in which the participating property and

An overpayment of excise cannot be applied as a credit to the tax of

casualty company contributes its full proportionate share. The amount

another account of this company or to the tax of another company.

of the credit is 100% for the year beginning on or after January 1, 2003

or the fifth year in which a participating property and casualty company

Line 53: Balance due. If line 37 is larger than line 49, enter the balance

contributes its full proportionate share.

due in line 53. Payment in full is due on or before March 15, 2016.

The total amount of the credit shall not exceed $8,000,000 for all do-

Line 54: Penalties. Any company that has an underpayment of esti -

mestic property and casualty companies. The amount of each property

mated tax will incur a penalty on the underpayment for the period of the

and casualty company’s credit shall be limited to that company’s credit

underpayment. Enclose a copy of Form M-2220. For more in formation,

share. A company seeking the credit must provide the Commissioner

refer to the section, “When Are Estimated Tax Payments Required?”

of Revenue with the amount of its retaliatory taxes attrib utable to the

Any company that fails to file a timely return will be subject to a late

surtax and payable for the preceding taxable year, before application

filing penalty of 1% per month, or fraction thereof, and a late payment

for the credit, by December 31 of the current taxable year. The com-

penalty of 1% per month, or fraction thereof, on the amount required

missioner of revenue shall be responsible for reporting to each com-

to be shown as the tax due on the return. For more information, refer

pany its credit share amount by February fifteenth of the current taxable

to the section, “What Are the Penalties for Late Returns?”

year. A certificate of contribution issued by the Property and Casualty

Initiative must accompany the return.

Line 55: Interest. Any company that fails to pay its tax when due will

be subject to interest on the unpaid balance. For more information,

Line 22: Initiative credit. A company shall be allowed a credit against

refer to the section “What Are the Penalties for late Returns?”

the premium tax equal to 1

% (.015) of such company’s total capital

⁄

contribution in excess of their full proportionate share which shall mean

Line 56: Payment due. Enter the total payment due. Checks for this

an investment in the Massachusetts Property and Casualty Insurance

amount should be made payable to the Commonwealth of Massa-

Company Community and Economic Development Initiative.

chusetts. Checks should have the company’s federal identification

number written in the lower left corner.

Instructions For Massachusetts Premium Excise Return For Insurance Companies Form 63-23p - 2016 Page 9

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