RESUMEHB24 2991 355
RÉSUMÉ DIGEST
ACT 7 (HB 24) 2016 Second Extraordinary Session Anders
Existing law authorizes a credit against the insurance premium tax credit for insurers who
invest a portion of their total admitted assets in La. financial institutions and investment
products. The amount of the credit is graduated, with the amount increasing as the
percentage of an insurer's assets invested in La. increases as follows:
(1)A 66% tax credit for investment of 16% of assets.
(2)A 75% tax credit for investment of 20% of assets.
(3)A 85% tax credit for investment of 25% of assets.
(4)A 95% tax credit for investment of 33% of assets.
Existing law provides for a 5% reduction of the tax credit for any tax year beginning on or
after Jan. 1, 2016, and before Jan. 1, 2018, unless the insurance company claiming the
reduction writes life insurance premiums and has total admitted assets of $15 million or less.
Existing law defines "qualified La. investment" as:
(1)Bonded debt issued with approval by the State Bond Commission.
(2)Mortgages on property located in this state.
(3)Real property located in this state.
(4)Policy loans and other loans to residents and corporations domiciled in La.
(5)Common or preferred stock in corporations domiciled in this state.
New law exempts health maintenance organizations from the 5% reduction of the tax credit.
Further authorizes, for taxable years beginning on or after Jan. 1, 2017, and before Jan. 1,
2019, the following as "qualified La. investments" for health maintenance organizations:
(1)Certificates of deposit issued by a La. bank or investments in such instruments by a
trust company with a main office or one or more branches in La.
(2)Cash on deposit in a La. bank or a trust company holding such funds in trust,
operating in the state with a main office or one or more branches.
New law authorizes a 50% reduction for the tax due under existing law for calendar year
2016 for certain domestic health maintenance organizations with no fewer than 500
employees residing in La. if the health maintenance organization has invested at least $25
million in bonds of the state, a political subdivision, or bonds approved for issue by the State
Bond Commission for the last two calendar quarters of 2016. Further prohibits application
of the reduction to premiums collected or received pursuant to Medicaid or the State
Children's Health Insurance Program or to a health maintenance organization that is eligible
for a tax reduction under existing law.
Effective upon signature of governor (June 24, 2016).
(Amends R.S. 22:832(A)(3); Adds R.S. 22:832(C)(6) and (F))