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Business Taxes Law Guide—Revision 2024
Tax on Insurers Annotations
Under Revenue and Taxation Code section 12257, if an insurer's prepayments for a calendar year exceed the amount of tax due for that year, the insurer may elect to credit its overpayment against the amounts due and payable as the prepayment for the first quarter of the following year. This provision does not grant an insurer who makes an overpayment of prepayments an election to apply any remainder in excess of the first quarter prepayment to the insurer's second quarter prepayment. Under Revenue and Taxation Code section 12977, the Controller is required to credit any excess to any amounts then due and payable from the insurer and refund the balance. As such, the remaining net credit in excess of the first quarter prepayment due will be refunded. Any inappropriate application by the insurer of a prepayment excess to its second quarter prepayment will subject the insurer to a penalty with respect to a resulting late second quarter prepayment. 12/9/92. (Am. 2003–3, Am. 2005–1).