Section 36 Combined Group Reporting for Captive Insurance Companies

Subsection (c) of Section 32B of chapter 63 of the General Laws, as appearing in the 2022 Official Edition, is hereby amended by striking out paragraphs (1) and (2) and inserting in place thereof the following 3 paragraphs:-
         
          (c)(1) Corporations that are subject to combination within the meaning of this section shall include an entity of the kind that is subject to tax or would be subject to tax if doing business in the state under section 2, 2B, 32D or 39. A corporation is subject to combination irrespective of whether the corporation is actually subject to tax under section 2, 2B, 32D or 39. A corporation subject to combination includes a real estate investment trust as referenced under sections 856 to 859, inclusive, of the Code and a regulated investment company as referenced under sections 851 to 855, inclusive, of the Code. Any corporation included in the combined group pursuant to this section that is subject to tax under section 2, 2B, 32D or 39 shall determine that part of its taxable net income or loss that is derived from a unitary business or from an affiliated group pursuant to an election under paragraph (2) of subsection (g). Such corporation shall not be subject to any duplicate inclusion of income or benefit from any duplicate deduction of loss under section 2, 2B, 32D or 39.
         
          (1 ½) A corporation subject to combination within the meaning of this section shall not include an insurance company as defined in section 1 of chapter 175, except that such an insurance company shall be subject to combination if it is licensed as a captive insurance company under the laws of any jurisdiction. An insurance company subject to combination shall not be subject to tax under sections 20 to 29E.

          (2) A corporation subject to combination within the meaning of this section shall not include an entity described in section 38B or 38Y.

This section requires corporate tax filers to include affiliated captive insurance companies in their combined reporting group.