A captive premium tax return is the form a licensed captive insurance company files each year to report the premiums it took in and to pay the state premium tax it owes on those premiums. Every captive that holds a certificate of authority must file one, even in a year when it wrote little or no business, because most states charge a minimum tax whether or not the captive collected a dime.
Getting this return right matters more than many owners expect. The District of Columbia now mandates the NAIC OPTins system for every captive filing as of January 1, 2026, and a missed March deadline can trigger penalties, interest, and even a hold on your certificate of authority renewal. With more than 6,000 captives licensed across U.S. states and the District, and Vermont alone licensing over 600 active captives, the premium tax return is the single most repeated compliance task in the captive world.
Here is what you will learn in this guide:
- 📋 What the captive premium tax return is and exactly who must file it in each major state
- 🗂️ The documents and numbers you must gather before you open the form
- ✍️ A line-by-line walkthrough of every box, using real form labels and rates
- 👥 Three full filled-out examples following named captives from start to finish
- ⚠️ The field-level mistakes that trigger penalties, plus the deadlines and fees you cannot miss
What the Form Is and Who Must File It
The captive premium tax return is a state tax form that converts a captive’s written premiums into a dollar tax owed to the state that licensed it. It is not the same as the captive’s annual financial report, though the two are linked. The premium numbers on the tax return must match the premium numbers on the annual report, and several states make you attach the annual statement to the return as proof.
Every state taxes captives a little differently, but the core rule is the same: if you hold a certificate of authority as a captive, you file. In Kentucky, the tax sits under KRS 304.49-220 and applies to both domestic and foreign captives. In Texas, licensed captive insurers pay a 0.5 percent rate on the entire premium they receive, regardless of where the risk sits. In Vermont, 8 V.S.A. § 6007 governs the reports that support the premium tax return.
Who files depends on the captive type. Pure (single-parent) captives, association captives, sponsored or cell captives, industrial insured captives, and agency captives all file, but rate tables and minimum taxes vary by type and state. Risk retention groups (RRGs) are a special case. In the District of Columbia, domestic RRGs file a different premium tax return than non-RRG captives, so picking the wrong form is a common early error.
The agency that receives the return also varies. Kentucky routes it to the Department of Revenue, Texas to the Comptroller, and D.C. to the Department of Insurance, Securities and Banking. Knowing your regulator tells you which form, portal, and deadline apply to you.
Before You Start: Documents and Information You Need
Open the return only after you have gathered everything below. Filing with a missing number forces an amended return later, and amended captive returns draw extra scrutiny.
- Federal Employer Identification Number (FEIN). The state cross-checks this against your license; a wrong digit can misroute your payment and leave you marked as a non-filer.
- NAIC company number. Several forms, including the D.C. Captive PTR, have a dedicated NAIC box, and a blank box stalls processing.
- Your captive ID or state account number. Kentucky’s form carries an account number block; the wrong account number credits another company’s tax.
- Total direct written premiums for the calendar year. This is the heart of the return, and it must tie to your annual statement to the penny.
- Total assumed reinsurance premiums. These are taxed at a separate, lower rate, so you must track them apart from direct premiums.
- Returned premiums and policyholder dividends. Kentucky lets you subtract returned premiums before computing tax, so missing this number means overpaying.
- A copy of the Captive Annual Statement. Kentucky requires you to attach the annual statement filed with the Commissioner of Insurance; without it the return is incomplete.
- The authorized officer’s name and title. The return is signed under penalty of perjury, so the signer must be a president or chief accounting officer.
- Prior-year prepayment records. Texas captives that owe enough must make semi-annual prepayments, and you credit those against the annual tax.
Each item maps to a box on the form. If even one is missing, the safest move is to wait and gather it rather than guess, because a guessed premium figure is the single most common cause of an amended captive return.
Where to Get the Form and How to Access It
You always pull the captive premium tax return from the official agency that licensed your captive, never from a third-party template site, because rates and revision dates change. In Kentucky, the current form is Form 74A106 (1-23), and the revision code (1-23) printed at the bottom tells you it is the January 2023 version. Always confirm the revision code matches the current tax year before you start.
In Texas, you do not download a paper form for most captives. The Comptroller directs filers to report through Webfile, and the reporting channel depends on how much tax you paid the prior fiscal year. Captives that paid $50,000 or more must use Webfile, and there is no paper option for them.
In the District of Columbia, the form lives inside a portal. As of January 1, 2026, OPTins is mandatory for all DC captive filings, and the paper PDF is published only so you can calculate the tax before keying it into OPTins. You register for an OPTins account at optins.org, and the NAIC charges a $17.50 fee per transaction.
Vermont supports its premium tax return with the “Vermont Captive Insurance Company Annual Report,” and 8 V.S.A. § 6007 sets the premium schedule filing date. Pull the current report template from the Department of Financial Regulation, since the form is updated by rule.
Step-by-Step: How to Fill Out the Captive Premium Tax Return Line by Line
The walkthrough below uses the Kentucky Form 74A106 (1-23) as the primary template because it shows every element common to captive returns: identity boxes, a direct premium tax table, a separate assumed reinsurance table, a minimum tax, and a perjury signature. Where another state differs in a meaningful way, the difference is flagged inside the field. Follow the boxes in the exact order they appear on the form.
1. Company Name and FEIN
This box asks for the legal name of the captive and its nine-digit Federal Employer Identification Number. Enter the captive’s exact licensed name, not the parent company’s name, and key the FEIN as nine digits with no letters. Summit Pure Captive Insurance Company writes its name in full and enters 61-1234567 in the FEIN block.
What if your captive does business under a slightly different trade name? Use the name on the certificate of authority, because the state matches the return to the license, not to a trade name. The most common mistake here is entering the parent’s FEIN instead of the captive’s own FEIN, which credits the payment to the wrong taxpayer and leaves the captive flagged as a non-filer. Many owners wrongly believe the captive can file under the parent’s tax ID since the parent funds it, but the captive is a separate insurer with its own FEIN.
2. NAIC / Tax ID Number
This box asks for the captive’s NAIC company code, a unique number the National Association of Insurance Commissioners assigns to licensed insurers. Copy the number exactly from your certificate of authority or annual statement, with no spaces. Summit Pure Captive enters its assigned code 16789 here.
What if your captive is brand new and has not yet received an NAIC number? Contact the regulator before filing, since some states issue a temporary identifier. The common mistake is confusing the NAIC code with the state account number and swapping the two, which causes the return to fail an automated match and sit unprocessed. People often assume the NAIC code is optional for small captives, but the D.C. return carries a dedicated NAIC box that the system expects filled.
3. Home Office and Mailing Address
This box asks for the captive’s home office street address and its separate mailing address if different. Enter the physical home office on the street line and any P.O. Box on the mailing line, using all caps for clean scanning. Summit Pure Captive writes 400 MAIN STREET as its home office and PO BOX 1500 as its mailing address.
What if your captive’s records are kept at a captive manager’s office in another state? List the registered home office of record, not the manager’s office, because the regulator ties domicile to the licensed address. The common mistake is leaving the mailing line blank when it differs from the home office, which sends correspondence and refund checks to the wrong place. Filers often think the address is cosmetic, but a returned notice can mean a missed deadline you never saw coming.
4. Line A.1 — Total Premium Receipts
This line asks for every dollar of direct premium the captive received during the calendar year before any deductions. Enter the gross figure that ties to your annual statement, with no netting yet. Summit Pure Captive received $8,000,000 in direct premium and enters 8,000,000 on Line A.1.
What if some premium was billed in December but not collected until January? Report on the basis your captive uses in its annual statement, since the premium figures must agree with the annual report. The common mistake is reporting net premium here instead of gross, which understates the base and triggers a tax adjustment. Owners often confuse “receipts” with “earned premium,” but this line wants premium received, not premium earned over the policy term.
5. Line A.2 — Returned Premiums
This line asks for premiums you refunded to insureds during the year, such as cancellations or audit-driven returns. Enter the total returned amount as a positive number; the form subtracts it on the next line. Summit Pure Captive refunded $200,000 on a cancelled policy and enters 200,000 on Line A.2.
What if you paid policyholder dividends rather than true premium refunds? Read the state rule, since some states allow a dividend deduction and others do not; Kentucky’s line is specifically for returned premiums. The common mistake is dumping unrelated expenses into this box to shrink the tax, which is a misstatement made under penalty of perjury. People wrongly assume any money paid out reduces premium, but only genuine returned premium belongs on Line A.2.
6. Line A.3 — Net Premium Receipts
This line asks for net premium, which you get by subtracting Line A.2 from Line A.1. Do the subtraction and enter the result; this net figure feeds the tax computation table. Summit Pure Captive subtracts 200,000 from 8,000,000 and enters 7,800,000 on Line A.3.
What if returned premiums exceed premiums received in a shrinking year? Enter the negative result and contact the regulator, because a negative base usually still triggers the minimum tax. The common mistake is a math error that carries the wrong base into the rate table, which throws off every line below it. Filers often think a small net premium means little or no tax, but the minimum tax floor usually applies regardless.
7. Direct Premium Tax Computation (Lines A–E)
This section asks you to apply Kentucky’s tiered rates to your net premium receipts. The rates are 0.4% on the first $20 million, 0.3% on the next $20 million, 0.2% on the next $20 million, and 0.075% on each dollar thereafter. Summit Pure Captive, with $7,800,000 in net premium, applies 0.4% to the whole amount and enters 31,200 as its total direct premium tax on Line E.
What if your premium crosses a bracket, say $30 million? Tax the first $20 million at 0.4% and only the next $10 million at 0.3%, never the whole amount at one rate. The common mistake is applying the top-tier rate to the entire premium, which badly overstates or understates the tax. Filers often believe one flat rate applies, but captive premium taxes are tiered, and each layer carries its own rate.
8. Section B — Assumed Reinsurance Premium Receipts
This section asks for premiums the captive took on as assumed reinsurance, taxed on a separate, lower schedule. Enter assumed reinsurance premium apart from direct premium, then apply Kentucky’s assumed rates of 0.225%, 0.150%, 0.050%, and 0.025% across the same $20 million tiers. Northbridge Reinsurance Captive assumed $5,000,000 in reinsurance and enters 5,000,000, computing 11,250 in assumed tax.
What if assets were received in exchange for assuming loss reserves of an affiliate being wound down? Kentucky exempts that transaction from reinsurance premium tax when the intent is to maintain the business with the captive under common ownership. The common mistake is lumping assumed reinsurance into direct premium, which overtaxes it at the higher direct rate. People often think all premium is taxed the same, but assumed reinsurance enjoys roughly half the direct rate in most states.
9. Total Net Tax Liability and the Minimum Tax
This line asks you to add the direct tax and the assumed tax, then compare the sum to the state minimum. Kentucky states plainly that a minimum $5,000 is due, so if your computed tax is lower, you pay the minimum. Summit Pure Captive’s computed $31,200 exceeds the minimum, so it owes $31,200; a tiny captive computing only $900 would still owe 5,000.
What if your captive wrote zero premium all year? You still owe the minimum tax, because the floor applies to licensed captives regardless of activity. The common mistake is filing zero tax in a dormant year, which creates an underpayment plus penalty. Many owners assume no premium means no tax, but the minimum tax is the price of holding the license. Note the ceiling too: Texas caps captive premium tax at $200,000 and D.C. caps it at $100,000.
10. Annual Certificate of Authority Renewal (Where Applicable)
This line, present on the D.C. return, asks for the $300 Certificate of Authority renewal that captives may pay with the tax in one OPTins transaction. Enter the renewal fee if you are combining it; D.C. encourages this to avoid paying the $17.50 OPTins fee twice. A D.C. captive enters 300 on the renewal line and folds it into the total payment.
What if your renewal is not yet due when you file premium tax? You may still combine them to save a transaction fee, which is why D.C. recommends one payment. The common mistake is filing tax and renewal as two separate OPTins transactions, which doubles the NAIC fee. Filers often assume the renewal is billed separately by mail, but the portal lets you bundle it.
11. Total Payment Line
This line asks for the grand total you are remitting: premium tax (or the minimum) plus any renewal fee. Add the lines above and enter the final figure that matches your payment. A D.C. captive at the minimum enters 7,500 tax plus 300 renewal for a 7,800 total payment.
What if you already made Texas semi-annual prepayments on March 1 and August 1? Credit those prepayments against the annual liability so you do not pay twice. The common mistake is remitting the gross tax without subtracting prepayments, which creates an overpayment you must then chase as a refund. People often forget that Texas requires semi-annual prepayments for larger captives.
12. Signature, Title, and Perjury Declaration
This block asks an authorized officer to sign under penalty of perjury that the return is true, correct, and complete. The signer must be the president or chief accounting officer; print the name, title, phone, email, and date. Summit Pure Captive’s CFO, Maria Delgado, signs, prints MARIA DELGADO, enters title CHIEF FINANCIAL OFFICER, and dates it 02/15/2026.
What if a captive manager prepares the return? The preparer may complete it, but an officer of the captive must sign the perjury declaration, not the outside manager alone. The common mistake is leaving the signature block blank or letting an unauthorized staffer sign, which makes the return invalid even if filed on time. Filers often think an electronic checkbox in OPTins is informal, but the D.C. certification carries the same perjury weight as an ink signature.
Three Filled-Out Examples Using Real Scenarios
Below are three named captives walked through the most common fact patterns: a small pure captive paying the minimum, a mid-size captive crossing a rate tier, and a reinsurance captive with assumed premium on a separate schedule.
Scenario 1: Aspen Pure Captive (Kentucky, minimum tax)
Aspen is a single-parent captive that wrote only $400,000 in premium this year. Its computed tax falls below the floor, so it pays Kentucky’s $5,000 minimum.
| Form Section | What Aspen Enters |
|---|---|
| Company Name | Aspen Pure Captive Insurance Company |
| FEIN | 61-2233445 |
| NAIC / Tax ID | 16544 |
| Line A.1 Total Premium Receipts | 400,000 |
| Line A.2 Returned Premiums | 0 |
| Line A.3 Net Premium Receipts | 400,000 |
| Direct Tax (0.4% of 400,000) | 1,600 |
| Section B Assumed Reinsurance | 0 |
| Total Net Tax Liability (minimum applies) | 5,000 |
| Signature / Title | Maria Delgado, CFO |
Scenario 2: Cedar Mutual Captive (Kentucky, crossing a rate tier)
Cedar is an association captive that wrote $30,000,000 in direct premium, so it crosses from the 0.4% tier into the 0.3% tier.
| Form Section | What Cedar Enters |
|---|---|
| Company Name | Cedar Mutual Captive Insurance Company |
| FEIN | 61-7788990 |
| NAIC / Tax ID | 17012 |
| Line A.1 Total Premium Receipts | 30,000,000 |
| Line A.2 Returned Premiums | 500,000 |
| Line A.3 Net Premium Receipts | 29,500,000 |
| Tax on first $20M at 0.4% | 80,000 |
| Tax on next $9.5M at 0.3% | 28,500 |
| Total Net Tax Liability | 108,500 |
| Signature / Title | James Okafor, President |
Scenario 3: Northbridge Reinsurance Captive (Kentucky, assumed premium)
Northbridge wrote $3,000,000 in direct premium and assumed $5,000,000 in reinsurance, so it fills both tables.
| Form Section | What Northbridge Enters |
|---|---|
| Company Name | Northbridge Reinsurance Captive Company |
| FEIN | 61-5566778 |
| Line A.3 Net Direct Premium | 3,000,000 |
| Direct Tax (0.4% of 3,000,000) | 12,000 |
| Section B Assumed Reinsurance | 5,000,000 |
| Assumed Tax (0.225% of 5,000,000) | 11,250 |
| Total Net Tax Liability (12,000 + 11,250) | 23,250 |
| Annual Statement Attached? | Yes |
| Signature / Title | Priya Nair, Chief Accounting Officer |
How to File the Completed Form
Captive premium tax returns are filed through one of four channels, and the right channel depends on your state and your tax volume. File early, because every channel below is unforgiving about the March deadline.
- Online portal (OPTins). D.C. requires OPTins for all captive filings as of January 1, 2026. Register at optins.org, upload or key the return, pay by the portal’s electronic method, and keep the confirmation page; the NAIC fee is $17.50 per transaction.
- State web system (Texas Webfile). Texas captives report through Webfile, the only accepted method for captives paying $50,000 or more. Pay by Web EFT, credit card, or TEXNET, and save the Webfile confirmation as proof.
- By mail (Kentucky). Kentucky captives mail the return with a check payable to the Kentucky State Treasurer to the Department of Revenue, P.O. Box 1303, Frankfort, KY 40602-1303, or use the overnight address at 501 High Street, Frankfort, KY 40601-2103. Keep a certified-mail receipt as proof of timely filing.
- Online payment with mailed return (Kentucky hybrid). If you pay Kentucky tax online, you still mail the return and the “Payment Schedule Confirmation” page to the same address, and you note the confirmation number on the form.
Whatever the channel, keep the proof of filing for at least the audit period. A confirmation page or certified-mail receipt is your only defense if the state later claims you missed the deadline.
What Happens After You File
After you file, the agency matches your return against your license and your annual statement, then posts your payment to your account. If the premium figures on the return do not tie to the annual statement, expect a notice, because D.C. and most states require the two to agree.
If you underpaid, the state assesses the shortfall plus penalty and interest. In Texas, tax paid 1 to 30 days late draws a 5 percent penalty, and tax paid more than 30 days late draws a 10 percent penalty, with interest starting 61 days after the due date. These charges compound, so a forgotten return grows fast.
If you overpaid, you can usually claim a credit or refund, but the process is slow and ties up cash for months. This is why crediting prepayments correctly on the original return beats chasing a refund later. A clean, matched return typically processes without a notice, and your certificate of authority renewal moves forward on schedule.
Mistakes to Avoid When Filling Out the Form
- Entering the parent’s FEIN instead of the captive’s. The payment credits the wrong taxpayer and the captive is flagged as a non-filer.
- Reporting net premium on the gross premium line. This understates the base and triggers a tax adjustment with penalty.
- Applying one flat rate to all premium. Captive taxes are tiered, so a flat rate misstates the tax in either direction.
- Mixing assumed reinsurance into direct premium. Assumed premium is taxed at roughly half the direct rate, so blending overtaxes it.
- Filing zero tax in a dormant year. The minimum tax still applies, so zero creates an underpayment.
- Forgetting the minimum tax floor. A small computed tax does not relieve you of the Kentucky $5,000 or Texas $7,500 minimum.
- Ignoring the maximum cap. Overpaying past the Texas $200,000 or D.C. $100,000 cap wastes cash.
- Not attaching the annual statement. Kentucky requires it, and a missing attachment makes the return incomplete.
- Leaving the signature block blank. An unsigned perjury declaration makes the return invalid even if timely.
- Filing premium figures that do not match the annual report. A mismatch draws an automatic notice and possible audit.
- Skipping Texas semi-annual prepayments. Larger captives owe prepayments on March 1 and August 1, and skipping them creates penalties.
- Filing on paper where the portal is mandatory. D.C. rejects non-OPTins filings as of January 1, 2026.
Do’s and Don’ts
Do:
- Do confirm the form revision date first, because rates change and the Kentucky (1-23) code tells you the version.
- Do tie every premium figure to the annual statement, since the two must agree to avoid a notice.
- Do separate direct premium from assumed reinsurance, because they carry different rates.
- Do check both the minimum and the maximum tax, so you neither underpay nor overpay.
- Do keep your confirmation or certified-mail receipt, as it is your only proof of timely filing.
- Do have an authorized officer sign, because the perjury declaration requires a president or chief accounting officer.
Don’t:
- Don’t use a third-party template, because only the official agency form carries current rates.
- Don’t guess a premium number, since a guess forces an amended return that draws scrutiny.
- Don’t ignore the minimum tax in a quiet year, because it applies regardless of activity.
- Don’t file two OPTins transactions when you can bundle tax and renewal to save the $17.50 fee.
- Don’t miss the March deadline, because penalties and interest start fast.
- Don’t let an outside manager sign alone, since the officer’s signature is what makes the return valid.
Pros and Cons of Filing on Your Own vs. With Help
| Filing On Your Own | Filing With a Captive Manager or CPA |
|---|---|
| Saves professional fees, which helps a small pure captive | Costs a fee, but that fee is small against a 10 percent late penalty |
| Gives you direct control of the timing and confirmation | Frees your officers from learning each state’s tiered rate table |
| Forces you to learn the form, useful for future years | Reduces the risk of a premium mismatch with the annual statement |
| Works well for a simple, single-state, minimum-tax captive | Handles multi-state and assumed reinsurance complexity cleanly |
| Avoids sharing sensitive premium data with outsiders | Keeps you current as rates and portal rules change each year |
A self-filed return makes sense for a small captive with one state and minimum tax. A manager or CPA earns the fee once you cross rate tiers, write assumed reinsurance, or file in multiple states.
Captive Premium Tax vs. Traditional Insurer Premium Tax
| Captive Premium Tax | Traditional Insurer Premium Tax |
|---|---|
| Often tiered, with rates dropping as premium rises | Usually a single flat rate on all premium |
| Carries a minimum tax even with little premium | Rarely carries a minimum tax floor |
| Carries a maximum cap in many states | Generally has no maximum cap |
| Direct and assumed reinsurance taxed separately | Assumed reinsurance often treated differently or exempt |
| Filed by the captive itself under its own FEIN | Filed by a commercial carrier across many states |
FAQs
Do I have to file if my captive wrote no premium this year?
Yes. A licensed captive still owes the minimum tax, such as Kentucky’s $5,000, even in a year with zero premium, so you must file.
Do I use the parent company’s FEIN on the return?
No. The captive is a separate insurer, so you must enter the captive’s own FEIN, not the parent’s, or the payment credits the wrong taxpayer.
Do I report direct premium and assumed reinsurance on the same line?
No. They sit on separate tables with different rates, so blending them overtaxes the assumed reinsurance at the higher direct rate.
Do I enter gross or net premium on the total premium receipts line?
Yes, enter gross. Line A.1 wants total receipts before deductions, and returned premiums come off on the next line.
Do I owe the full computed tax if it exceeds the state maximum?
No. Caps apply, such as the Texas $200,000 or D.C. $100,000 maximum, so you pay no more than the cap.
Do I have to use OPTins to file in the District of Columbia?
Yes. As of January 1, 2026, OPTins is mandatory for all DC captive filings, and the paper form is for calculation only.
Do I write the captive manager’s address in the home office box?
No. Enter the captive’s registered home office of record, because the regulator ties domicile to the licensed address, not the manager’s office.
Do I need to attach my annual statement to the return?
Yes, in Kentucky. The form requires you to attach the Captive Annual Statement, and without it the return is incomplete.
Do policyholder dividends go on the returned premiums line?
No, not in Kentucky. That line is for genuine returned premiums, so check your state rule before deducting dividends.
Do I credit Texas semi-annual prepayments against the annual tax?
Yes. Subtract the March 1 and August 1 prepayments from the annual liability so you do not pay twice.
Do I get penalized for filing one day late?
Yes. Texas assesses a 5 percent penalty for tax paid 1 to 30 days late, so even one day past March 1 costs you.
Do risk retention groups file the same return as other captives?
No. In D.C., domestic RRGs file a separate premium tax return from non-RRG captives, so confirm your entity type first.
Do I sign the return myself if a CPA prepared it?
Yes. An authorized officer, a president or chief accounting officer, must sign the perjury declaration even when a CPA or manager prepares it.
Do Vermont captives have the same March 1 deadline?
No, not always. Under 8 V.S.A. § 6007, pure and several other captive types file supporting reports by March 15, so check your type.
Related reading
- How to Fill Out the Washington OIC Captive Insurance Application + FAQs
- How to Fill Out the Washington OIC Captive Insurance Application (Eligible Captive Insurer Registration) + FAQs
- How to Fill Out the Captive Annual Report (w/Examples) + FAQs
- How to Fill Out the Montana Captive Insurance Company Application + FAQs
- How to Fill Out the Vermont Captive Insurance Company Application + FAQs
- How to Fill Out the Maryland Captive Insurance Application + FAQs