Connecticut's New Captive Legislation: Taxation impact on Connecticut businesses that own captives domiciled out of Connecticut
June 30, 2022
Our friends at the State of Connecticut Insurance Department would like to draw your attention to Connecticut's new captive insurance legislation, effective July 1.
Of particular note may be Sec. 442 (effective July 1, 2022):
(a) As used in this section, "alien captive insurance company", "branch captive insurance company" and "foreign captive insurance company" have the same meanings as provided in section 38a-91aa of the general statutes.
(b) The Commissioner of Revenue Services shall waive any and all penalties that would otherwise be due under section 38a-277 of the general statutes for any taxable period beginning on or after July 1, 2019, and ending prior to July 1, 2022, if, not later than June 30, 2023, the insured:
- Establishes a branch captive insurance company in this state or transfers the domicile of its alien captive insurance company or foreign captive insurance company to this state in accordance with the provisions of section 38a-58a of the general statutes; and
- Pays all taxes and interest due and outstanding under section 38a-277 of the general statutes for all taxable periods ending on or after July 1, 2019, but prior to July 1, 2022.
(c) Any insured that satisfies the provisions of subsection (b) of this section shall not be liable for any taxes, interest and penalties that would otherwise be due under section 38a-277 of the general statutes for any taxable period ending prior to July 1, 2019.