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S 3814

Imposes a tax on out-of-state transfers, dividends, payments, and loans by certain accident and health insurance companies and health maintenance organizations

2025 Regular Session Introduced by Nathalia Fernández and 3 co-sponsors

Summary of S 3814: Tax on Out-of-State Transfers by Insurance Companies OverviewThis bill, introduced in the Senate on October 24, 2024, would impose a new tax on certain out-of-st

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Bill Summary · S 3814

Summary of S 3814: Tax on Out-of-State Transfers by Insurance Companies

Overview

This bill, introduced in the Senate on October 24, 2024, would impose a new tax on certain out-of-state transfers, dividends, payments, and loans made by accident and health insurance companies and health maintenance organizations (HMOs). The goal of the legislation is to generate additional revenue from the operations of these insurance entities.

Key Provisions

  • Imposes a 5% tax on the following types of transfers made by accident and health insurers and HMOs to out-of-state entities:
    • Dividends
    • Payments
    • Loans
    • Other financial transfers
  • Exempts transfers between affiliated companies within the same parent organization
  • Requires insurance companies and HMOs to report and remit the applicable tax payments on a quarterly basis

Affected Entities

  • Accident and health insurance companies
  • Health maintenance organizations (HMOs)
  • Out-of-state entities that receive transfers from the above insurance providers

Procedural and Timeline Details

  • The bill has been referred to the Senate Insurance Committee for consideration
  • If enacted, the new tax requirements would take effect for the first full tax year after the bill's passage
  • The bill is related to two prior-session Senate bills (S 8470 and S 9574) and has a companion bill (A 5743) introduced in the state Assembly

Overall, this legislation aims to generate additional state revenue by imposing a tax on certain cross-border financial activities by accident and health insurers and HMOs. The impact would primarily fall on the insurers themselves, as well as any out-of-state entities that receive transfers from these providers.

Compiled from official sources — confirm details with the bill’s official record.

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