§ 38.2-411. Failure to pay estimated assessment
A. In case of any underpayment of estimated assessment by a company, except as provided in subsection D of this section, interest shall be added to the assessment for the license year and shall be determined at the rate set forth in § 58.1-15. Interest shall be based on the amount of the underpayment as determined in subsection B for the period of the underpayment as determined in subsection C.
B. For purposes of subsection A of this section the amount of the underpayment shall be the excess of the amount of the installment which would be required to be paid if the estimated assessment were equal to ninety percent of the assessment for the license year, over any amount of the installment paid on or before the last date prescribed for payment.
C. The period of the underpayment shall run from the date the installment was required to be paid to whichever of the following dates is the earlier:
1. The first day of the third month following the close of the assessable year.
2. For any portion of the underpayment, the date on which the portion is paid. For purposes of this subdivision, a payment of estimated assessment on any installment date shall be considered a payment of any previous underpayment only to the extent the payment exceeds the amount of the installment determined under subsection B for that installment date.
D. Notwithstanding the provisions of subsections A, B and C of this section, the addition to the assessment for any underpayment of an installment shall not be charged if the total amount of all estimated assessment payments made prior to the last date prescribed for the payment meets the following conditions. The total shall equal or exceed the amount which would have been required to be paid on or before the last date prescribed for the payment if the estimated assessment were the lesser of:
1. The assessment for the preceding license year which was computed on the basis of an assessable year of twelve months; or
2. An amount equal to the assessment computed at the rate applicable to the license year based on the facts shown on the company's report, and the applicable law for the preceding license year; or
3. a. An amount equal to ninety percent of the assessment measured by direct gross premium income received or derived in the assessable year computed by placing on an annualized basis the assessable direct gross premium income:
(1) For the first three months of the assessable year, in the case of the installment required to be paid in the fourth month;
(2) For the first three months or for the first five months of the assessable year, in the case of the installment required to be paid in the sixth month;
(3) For the first six months or for the first eight months of the assessable year, in the case of the installment required to be paid in the ninth month; and
(4) For the first nine months or for the first eleven months of the assessable year, in the case of the installment required to be paid in the twelfth month of the assessable year.
b. For the purposes of this subsection, the assessable direct gross premium income shall be placed on an annualized basis by (i) multiplying by twelve the assessable direct gross premium income referred to in subdivision 3 a of this subsection, and (ii) dividing the resulting amount by the number of months in the assessable year referred to in subdivision 3 a of this subsection.
E. The Commission shall determine the application of this section to assessable years of less than twelve months.
(1977, c. 317, § 38.1-48.6; 1986, c. 562.)
Sections: Previous 38.2-401.1 38.2-402 38.2-403 38.2-404 38.2-405 38.2-406 38.2-407 38.2-408 38.2-409 38.2-410 38.2-411 38.2-412 38.2-413 38.2-414 38.2-415 NextLast modified: April 16, 2009