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Premium notices that include LA Citizens assessments due to Hurricanes Katrina and
Rita are eligible for the credit. The LA Citizens assessments are listed separately
from the normal premium amount on the declaration page of your property's insurance
premium notice. The declaration page names the policyholder, describes the property
or liability to be insured, the type of coverage, and policy limits. Some insurance
companies may include a supplemental schedule with the declaration page that itemizes
the LA Citizens assessments.
LA Citizens assessment charges may include any or all of the following (your insurer's
description may vary slightly from the references below):
To determine the amount of the credit that can be claimed, add the assessment charges
for the four items above. If only one of the items appears on your insurance bill,
that amount is the amount of the credit.
Before the credit can be claimed, the assessment amounts must have been paid to
the insurance company directly by the property owner or by the property owner's
This is not a credit for the total amount due on your insurance bill.
Do not add your insurance premium to the LA Citizens assessments. If you are a customer
of the Louisiana Citizens Insurance Corporation, and you paid the Tax Exempt Surcharge,
this surcharge may not be claimed.
The credit may only be claimed in the year paid regardless of the due date of the
premium. For example, LA Citizens assessments paid during 2008 may be claimed on
the 2008 income tax return which is due in 2009. However, Act 382 of the 2007 Regular
Legislative Session amended Revised Statute 47:6025 to allow LA Citizens assessments
paid during 2007 and thereafter to be claimed on
Form R-620INS at the time of payment.
December 31, 2011 was the last day to file a 2007 income tax return in order to
claim a refund of LA Citizens assessments paid in 2007.
NOTE: If Form R-620INS is filed to claim credit for assessments paid
on or after January 1, 2007, the credit may not be claimed on the 2007 Louisiana
Corporation Income and Franchise Tax return.
A copy of the property's insurance declaration page and supplemental page, if
needed, that shows the separate charges for the LA Citizens assessments must be
attached to the paper corporation income tax returns. A substitute document issued
by your insurance company that contains the line item LA Citizens assessments will
be accepted if the original declaration page is not available.
Documents showing proof that the LA Citizens assessments were paid such as cancelled
checks, an image of a check, or an itemized escrow statement should be retained
for four years and produced in the case of an audit.
If the return was filed electronically, the declaration page and supplemental page
that show the separate charges for the LA Citizens assessments and proof of payment
must be retained for four years and produced in the case of an audit.
If the return was prepared by a paid tax preparer, a copy of the property's insurance
declaration page and supplemental page that shows the separate charges for the LA
Citizens assessments and proof of payment must be provided to the preparer. A preparer
may not claim this credit without documentation of payment of the assessment. If
the return is filed electronically, the preparer must keep a copy of this documentation.
The form that you use to claim the credit will depend on whether the entity is required
to file a Louisiana Corporation Income and Franchise Tax return.
For assessments paid on or after January 1, 2007, the credit can be claimed on the
Corporation Income and Franchise Tax return, Form CIFT-620 or on
Form R-620INS, the "Request for Refund of Louisiana Citizens Property Insurance
Corporation Assessment at the time of payment.
The credit may be claimed on
Form R-620INS, the Request for Refund of Louisiana Citizens Property Insurance
Corporation Assessment at the time of payment. If the corporation had more than
one property for which the LA Citizens assessments were paid, Form R-INS Supplement
must also be completed. Documentation, including proof of payment, for each property
listed must be attached to the form when it is filed.
NOTE: If you file Form R-620INS to claim the credit for assessments
paid on or after January 1, 2007, you are not entitled to claim the credit on your
2007 Louisiana Corporation Income and Franchise Tax return.
If the business that paid the LA Citizens assessments is a sole proprietorship,
the credit must be claimed on the individual income tax return.
If the business that paid the LA Citizens assessments operated as an S corporation,
the LA Citizens credit must be used at the corporation level unless the S corporation
makes the annual flow through election provided for in R.S. 47:1675 (G)(2)(b).
An S corporation that is entitled to the LA Citizens credit may elect to flow through
the entire amount of the credit to its shareholders. The election may be made separately
for each credit received by the S corporation and is made annually. There is no
special form required to make the election. The election is made when the S corporation
does not claim the credit on the CIFT-620, but instead allows each shareholder to
claim that shareholder's share of the credit on their own income tax return. Once
made, the election may not be revoked for that tax year.
The S corporation that elects to flow through any credits, including the LA Citizens
credit, must prepare and distribute to each shareholder a schedule detailing the
shareholder's share of each credit for which the election is made. Shareholders
claiming the credit should attach a copy of this schedule to the income tax return
on which the credit is claimed. Corporate and individual shareholders claim the
credit as prescribed by
Revenue Information Bulletin (RIB) 07-006.
If the business that paid the LA Citizens assessments is an entity not subject to
Louisiana income tax, such as a partnership, the LA Citizens credit will flow through
to partners or members of the entity as provided in the operating agreement. In
the absence of an operating agreement or if the operating agreement is silent with
respect to the allocation of tax items, the LA Citizens credit will flow through
to each partner or member in accordance to the partner or member's ownership interest
in the entity. Corporate and individual partners claim the credit as prescribed
Insurers that paid the 2005 regular assessment levied by the Louisiana Citizens
Property Insurance Corporation before January 1, 2007, and did not pass on the entire
assessment to their policyholders are eligible to receive a credit for the amount
of the regular assessment that they did not recover.
Insurers that paid the 2005 regular assessment and levied a recoupment surcharge
on the policyholders to recover the LA Citizens regular assessment are not entitled
to receive a credit for the amount of the assessment they recovered.
Eligible insurers that are not subject to Louisiana income tax may claim the credit
on Form R-620INS, the Request for Refund of Louisiana Citizens Property Insurance
Corporation Assessment. To claim the credit for the total LA Citizens regular assessment
or for that portion not recovered, the insurer must provide a copy of the LA Citizens
regular assessment payment notice and proof of payment. In addition, the insurer
must provide a certified statement and audited summary of the final amount recovered
from the insurer's policyholders. A copy of the certified statement, proof of payment,
and audited summary must also be filed with the Louisiana Department of Insurance,
Office of Property and Casualty.
Exempt organizations and corporations such as churches, not-for-profit hospitals,
charities, 501(C)(3) organizations, community foundations, banks that pay the local
shares tax, public entities such as municipalities and school board, and other corporations
exempt from the Louisiana corporate income tax under R.S.47:287.501 that paid the
LA Citizens assessments are eligible for the LA Citizens credit.
If the exempt organization is not required to file a Corporation Income and Franchise
Tax return, a claim for refund should be filed on the "Request for Refund of Louisiana
Citizens Property Insurance Corporation (LA Citizens) Assessment",
A copy of the entity's property insurance declaration page, supplemental pages,
and proof of payment must be attached to the
Businesses that have not claimed the credit for previous years must follow the directions
for their entity type as listed under “What form should be used to claim the credit?”.
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