Bill > SB60

This bill revises the tax structure for captive insurers in Montana, which are specialized insurance companies typically owned by a parent company to cover its own risks. The bill modifies how these insurers calculate and pay taxes on premiums, introducing a tiered tax rate system where different percentages apply to different levels of premium collections. Specifically, for direct premiums, insurers will pay 0.4% on the first $20 million and 0.3% on subsequent dollars, while reinsurance premiums will be taxed at 0.225% on the first $20 million, 0.150% on the next $20 million, and 0.050% on additional dollars. The bill maintains a $5,000 minimum annual tax, with prorated amounts for companies authorized or surrendering their authority during a calendar year. A significant change is the modification of the maximum tax cap, removing the $100,000 limit for protected cell and special purpose captive insurance companies, while maintaining it for other types. The bill also clarifies that companies under common ownership will be taxed as a single entity, and the tax calculations will be done on an annual basis, even for multi-year policies. The new tax provisions will apply to tax years beginning after December 31, 2025.

Budget and Finance, Business and Industry

https://bills.legmt.gov/#/laws/bill/2/LC0105