Illinois – Proposed tax on self-procured insurance could apply to captive insurance transactions

State and Local Tax
Illinois S.B. 3324 proposes a self-procurement tax on insurance premiums paid to unauthorized insurers. The tax is imposed on the insured, not the insurance company. The potential exists for this tax to extend to Illinois headquartered companies that insure risks through a captive insurance company. 
 
The bill passed the legislature on May 21, 2014, and was presented to the governor on June 19, 2014. The governor has 60 days after the bill is presented to sign or veto the bill, otherwise the bill becomes law without his signature.


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