SENATE, No. 1061

STATE OF NEW JERSEY

INTRODUCED MAY 2, 1996

By Senator PALAIA

An Act concerning the taxation of certain insurance companies, supplementing P.L.1945, c.132 (C.54:18A-1 et seq.).

    Be It Enacted by the Senate and General Assembly of the State of New Jersey:

    1. Notwithstanding the provisions of R.S.54:49-14 to the contrary, an insurance company that has filed a claim for refund on or before March 1, 1992, for taxes paid pursuant to section 2 of P.L.1945, c.132 (C.54:18A-2), for any of the five years prior to the filing of that refund claim, which taxes were paid without calculation by the taxpayer of the maximum amount of taxable premiums pursuant to section 6 of P.L.1945, c.132 (C.54:18A-6), and paid pursuant to returns audited by the Department of Insurance and the Division of Taxation in the Department of the Treasury, shall be permitted to file a claim for refund for an overpayment of such taxes within 90 days after enactment of this act.

    2. This act shall take effect immediately and shall apply to claims for refunds for which protests and appeals have been determined before enactment.

STATEMENT

    This bill provides an insurance company, other than a life insurance company, a 90-day period during which to file claims for overpayments of the insurance premiums tax for certain refund claims made that have been barred under the pre-1993 two-year statute of limitations for tax refund claims. The bill grants this limited period only for claims for taxes paid in any of the five years prior to the filing of the late refund claims. The bill extends this claims period only to the payment of taxes which were the subject of an audit by the Department of Insurance and the Division of Taxation, which audit did not reveal to the insurer that it overpaid taxes by failing to use the alternative tax calculation which is intended as an incentive for insurers to insure more New Jersey based risks.

    Prior to the enactment of the Taxpayers' Bill of Rights applicable to taxes paid on and after July 1, 1993 providing for a four-year statute of limitation on taxpayers' claims for refunds, the State Tax Uniform Procedure Law imposed a two-year statute of limitation on taxpayers' claims for refunds.

Provides temporary tax refund period for certain overpayments of insurance premiums tax by certain insurers.