If Mary is a surplus lines producer from Illinois with a nonresident license in Michigan, what percentage of the surplus lines tax should she pay to Michigan?

Mary, as a surplus lines producer with a nonresident license in Michigan, is required to pay the full surplus lines tax to Michigan. This is designed to align with the principle that the state where the risk is located—here, Michigan—should benefit from the surplus lines tax revenue derived from policies written for risks within its jurisdiction.

Given that Mary is transacting surplus lines insurance in Michigan, the law mandates that she must remit 100% of the applicable surplus lines tax to the state. This ensures that all surplus lines transactions, regardless of where the producer is licensed, contribute fully to state revenues that support regulatory functions, consumer protections, and other state interests.

The other options suggest reduced percentages that do not comply with the statutory requirement for remitting the full surplus lines tax in Michigan, which is not applicable in this scenario. Thus, the correct and complete payment obligation reflects the necessity for surplus lines producers to pay 100% of the surplus lines tax to the state where the risk is located.