Excise Lieu Property Tax: A Comprehensive Guide to Its Legal Framework
Definition & Meaning
Excise lieu property tax is a specific tax imposed on the gross premiums that certain insurance companies receive and collect. Unlike a license tax, this excise tax is assessed based on the total premiums rather than on the company's operational capacity. The gross premiums serve as a basis for determining how much these companies owe in taxes, and this assessment is distinct from other fees that may be mandated by law.
Legal Use & context
This term is primarily used in the context of tax law, particularly concerning insurance companies. It is relevant in civil law, especially in tax assessments and compliance. Users may encounter excise lieu property tax when dealing with tax filings or assessments related to insurance premiums. Legal forms related to tax assessments can be found through resources like US Legal Forms, which provide templates for compliance and reporting.
Real-world examples
Here are a couple of examples of abatement:
Example 1: An insurance company collects $1 million in premiums over a fiscal year. The excise lieu property tax is calculated based on this total amount, leading to a specific tax liability that the company must report and pay.
Example 2: A state may require insurance companies to file an annual report detailing their gross premiums to assess the excise tax owed. (hypothetical example)