N.Y. Tax Law 1505 – Limitation on tax
§ 1505. Limitation on tax. (a) (1) Domestic, foreign and alien insurance corporations except life insurance corporations. Notwithstanding the provisions of sections fifteen hundred one and fifteen hundred ten of this article, and except as otherwise provided in paragraph two of this subdivision, the amount of taxes imposed under such sections for taxable years beginning on or after January first, nineteen hundred seventy-seven and before January first, two thousand three, computed without regard to any credits allowable against such tax other than those credits provided under subdivisions (g) and (h) of section fifteen hundred eleven of this article, shall not exceed an amount computed as if such taxes were determined solely under section fifteen hundred ten, except that for purposes of the limitation provided herein, the rate of tax under such section shall be deemed to be (i) two and six-tenths percent for taxable years beginning on or after January first, nineteen hundred seventy-seven and before July first, two thousand, (ii) two and four tenths percent for taxable years beginning after June thirtieth, two thousand and before July first, two thousand one, (iii) two and two tenths percent for taxable years beginning after June thirtieth, two thousand one and before July first, two thousand two, and (iv) two percent for taxable years beginning after June thirtieth, two thousand two.
Terms Used In N.Y. Tax Law 1505
- Annuity: A periodic (usually annual) payment of a fixed sum of money for either the life of the recipient or for a fixed number of years. A series of payments under a contract from an insurance company, a trust company, or an individual. Annuity payments are made at regular intervals over a period of more than one full year.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- insurance corporation: includes a corporation, association, joint stock company or association, person, society, aggregation or partnership, by whatever name known, doing an insurance business, and, notwithstanding the provisions of section fifteen hundred twelve of this article, shall include (1) a risk retention group as defined in subsection (n) of § 5902 of the insurance law, (2) the state insurance fund and (3) a corporation, association, joint stock company or association, person, society, aggregation or partnership doing an insurance business as a member of the New York insurance exchange described in § 6201 of the insurance law. See N.Y. Tax Law 1500
(2) Domestic, foreign and alien life insurance corporations. The provisions of this paragraph shall apply to taxpayers subject to tax under paragraph one of subdivision (b) of section fifteen hundred ten of this article. Notwithstanding the provisions of sections fifteen hundred one and fifteen hundred ten of this article, the amount of taxes imposed under such sections for taxable years beginning on or after January first, nineteen hundred seventy-seven, computed without regard to any credits allowable against such tax other than those credits provided under subdivisions (g) and (h) of section fifteen hundred eleven of this article, shall not exceed an amount computed as if such taxes were determined solely under section fifteen hundred ten, except that for purposes of the limitation provided herein, the rate of tax under such section shall be deemed to be (i) two and six-tenths percent for taxable years beginning on or after January first, nineteen hundred seventy-seven and before January first, nineteen hundred ninety-eight, and (ii) two percent for taxable years beginning on or after January first, nineteen hundred ninety-eight.
(b) Notwithstanding the provisions of sections fifteen hundred one and fifteen hundred ten of this article, in the case of taxpayers subject to tax under subdivision (b) of section fifteen hundred ten, the total amount of tax imposed under this article, computed before the application of any credits allowable against such tax, shall in no event be less than the amount computed as if such tax was determined solely under section fifteen hundred ten, except that the rate of tax under section fifteen hundred ten shall be deemed to be one and five-tenths percent.
(c) For purposes of the limitation set forth in subdivision (a) of this section, in the case of an insurance corporation more than ninety-five percent of whose premiums are received as consideration for annuity contracts or are for policies and insurance described in paragraph two of subdivision (c) of section fifteen hundred ten of this article, in determining the amount of tax computed solely under section fifteen hundred ten of this article, gross direct premiums subject to tax under such section shall include such amounts received as consideration for annuity contracts and premiums for policies and insurance, including any separate costs assessed by such insurance corporation upon its policyholders, described in paragraph two of subdivision (c) of such section that exceed ninety-five percent of all premiums received, including consideration for annuity contracts and premiums for policies and insurance (and any separate costs assessed by such insurance corporations upon its policyholders) described in paragraph two of subdivision (c) of such section.