SB 576 — Corporate Income Tax

and220.03, 2. AllFlorida footwear,Statutes, excludingapplies skis,to swimtaxable fins,years rollerbeginning blades,on andor skates.after January 1, 2019.

(b) SchoolSection supplies3. Section having220.1105, aFlorida salesStatutes, priceis ofamended $15to orread: less per item.

As220.1105 Tax usedimposed; in this paragraph, the term “school supplies” means pens, pencils, erasers, crayons, notebooks, notebook filler paper, legal pads, binders, lunch boxes, construction paper, markers, folders, poster board, composition books, poster paper, scissors, cellophane tape, glue or paste, rulers, computer disks, protractors, compasses, and calculators.

(c) PersonalAutomatic computersrefunds and relateddownward accessoriesadjustments thatto havetax arates.— sales(1) As priceused ofin $1,000this orsection, lessthe perterm: item and that are purchased for noncommercial home or personal use.

As(a) “Net usedcollections” means the total amount of taxes collected under this chapter by the department in a the 2018 2019 fiscal year, including related interest and penalties, minus the total amount of refunds of taxes levied under this paragraph,chapter and issued by the term:department in that fiscal year, not including refunds issued pursuant to paragraph (2)(c).

1. “PersonalNo computer”later meansthan anSeptember electronic1, device2019, thatand acceptsSeptember information1, in2020, digitalthe orOffice aof similarEconomic form and manipulatesDemographic suchResearch informationshall fordetermine anet resultcollections basedfor onthe amost sequencerecent of2018-2019 instructions.fiscal year.

The(b) “Forecasted termnet includescollections” anmeans electronicthe bookamount readerof andnet acollections laptop,forecasted desktop,for handheld, tablet, or tower computer, but does not include a cellularthe telephone,2018-2019 videofiscal gameyear console,by digitalthe mediaRevenue receiver,Estimating orConference deviceon thatFebruary is23, not2018. primarily designed to process data.

2. “Related(c) “Adjusted accessories”forecasted includescollections” keyboards,means mice,forecasted personalnet digitalcollections assistants,for monitors,a other peripheral devices, modems, routers, and nonrecreational software, regardless of whether the accessories2018-2019 arefiscal usedyear inmultiplied associationby with1.07. a personal computer base unit.

The(d) “Tax termrate doesimposed” notis includethe furnituretax orrate systems,as devices,defined software,in monitorsss. with a television tuner, or other peripherals that are designed or intended primarily for recreational use.

(2) The220.11(2) taxand exemptions220.63(2) providedadjusted in this section do not apply to sales within a theme park or entertainment complex as definedset forth in s.this section.

509.013(9),(2) The Floridatax Statutes,rate withinimposed ashall publicbe lodgingadjusted establishmentbased ason definednet collections in s.the 2018-2019 fiscal year.

509.013(4),If Floridathe Statutes,net collections exceed the adjusted forecasted collections, the tax rate imposed for taxable years beginning on or withinafter anJanuary airport1, as2019, definedshall inbe s.the tax rate imposed for taxable years beginning on or after January 1, 2018, multiplied by the quotient of the adjusted forecasted collections divided by the net collections.

330.27(2),The Floridaresulting Statutes.tax rate shall be rounded to the nearest thousandth and rounded down if the fourth digit to the right of the decimal point is the number five.

(3) The(3) By taxOctober exemptions1, provided2019, inthe thisDepartment sectionof mayRevenue applyshall atcalculate the optiontax ofrate aimposed, dealer if lessit thanis 5to percentbe ofadjusted thepursuant dealer’sto grosssubsection sales(2), ofand tangibleshall personalon propertythat insame date report the priorresults calendarof yearsuch consistcalculation to the Governor, the President of itemsthe thatSenate, wouldand bethe exemptSpeaker underof thisthe section.House of Representatives.

If(2)(4) For athe qualifying2018-2019 dealerand chooses2019-2020 notfiscal toyears, participateany inamount the tax holiday, by Augustwhich 1,net 2019,collections thefor dealer must notify the Departmentfiscal ofyear Revenueexceed inadjusted writingforecasted ofcollections itsfor election to collect sales tax during the holidaysame and2018-2019 mustfiscal postyear ashall copyonly ofbe thatused noticeto inprovide arefunds conspicuousto locationcorporate atincome itstax placepayers ofas business.follows:

(4) The(a) For Departmentpurposes of Revenuethis may,subsection: and all conditions are deemed met to, adopt emergency rules pursuant to s.

120.54(4),1. “Eligible Floridataxpayer Statutes,for toa implementfiscal thisyear” section.means:

(5) Fora. For the 2018-2019 fiscal year, thea sumtaxpayer ofwhose $237,000taxable inyear nonrecurringbegins fundsbetween isApril appropriated1, from2017, theand GeneralMarch Revenue31, Fund2018, toand thewhose Departmentfinal oftax Revenueliability for thesuch purposetaxable ofyear implementingis thisgreater section.than zero.

Fundsb. For remainingthe unexpended2019-2020 orfiscal unencumberedyear, froma thistaxpayer appropriationwhose astaxable ofyear Junebegins 30,between 2019,April shall1, revert2018, and beMarch reappropriated31, for2019, theand samewhose purposefinal intax theliability 2019-2020for fiscalsuch year.taxable year is greater than zero.

Section2. “Excess 2. Thiscollections actfor shalla takefiscal effectyear” uponmeans becomingthe amount by which net collections for a law.fiscal the 2018-2019 year exceed adjusted forecasted collections for that fiscal year.

3. “Final tax liability” means the taxpayer’s amount of tax due under this chapter for a taxable year, reported on a return filed with the department pursuant to s.

220.222, including a return filed timely pursuant to a valid extension.

4. “Total eligible tax liability for a fiscal year” means the sum of final tax liabilities of all eligible taxpayers for a fiscal year, as such liabilities are shown on the latest return filed with the department as of the February 1 immediately following that fiscal year.

5. “Taxpayer refund share for a fiscal year” means an eligible taxpayer’s final tax liability as a percentage of the total eligible tax liability for that fiscal year.

6. “Taxpayer refund for a fiscal year” means the taxpayer refund share for a fiscal year multiplied by the excess collections for that fiscal year.

(b) No later than April 15 following a fiscal year February 15, 2020, the department shall determine total eligible tax liability for that fiscal year, the taxpayer refund share for that fiscal year for each eligible taxpayer, and the taxpayer refund for that fiscal year for each eligible taxpayer.

(c) No later than May 1 following a fiscal year March 1, 2020, the department shall refund a taxpayer refund for that fiscal year to each eligible taxpayer.

(5) Tax rate adjustments pursuant to this section are repealed for taxable years beginning on or after January 1, 2020.

Section 4. Paragraph (b) of subsection (1) of section 220.13, Florida Statutes, is amended to read:

220.13 “Adjusted federal income” defined.— (1) The term “adjusted federal income” means an amount equal to the taxpayer’s taxable income as defined in subsection (2), or such taxable income of more than one taxpayer as provided in s.

220.131, for the taxable year, adjusted as follows:

(b) Subtractions.— 1. There shall be subtracted from such taxable income:

a. The net operating loss deduction allowable for federal income tax purposes under s.

172 of the Internal Revenue Code for the taxable year, except that any net operating loss that is transferred pursuant to s.

220.194(6) may not be deducted by the seller, b. The net capital loss allowable for federal income tax purposes under s.

1212 of the Internal Revenue Code for the taxable year, c. The excess charitable contribution deduction allowable for federal income tax purposes under s.

170(d)(2) of the Internal Revenue Code for the taxable year, and d. The excess contributions deductions allowable for federal income tax purposes under s.

404 of the Internal Revenue Code for the taxable year.

164 However, a net operating loss and a capital loss shall never be carried back as a deduction to a prior taxable year, but all deductions attributable to such losses shall be deemed net operating loss carryovers and capital loss carryovers, respectively, and treated in the same manner, to the same extent, and for the same time periods as are prescribed for such carryovers in ss.

172 and 1212, respectively, of the Internal Revenue Code.

2. There shall be subtracted from such taxable income any amount to the extent included therein the following:

a. Dividends treated as received from sources without the United States, as determined under s.

862 of the Internal Revenue Code.

b. All amounts included in taxable income under s.

78, or s.

951, or s.

951A of the Internal Revenue Code.

180 However, any amount subtracted under this subparagraph shall only be allowed to the extent that such amount is not deductible in determining federal taxable income.

As to any amount subtracted under this subparagraph, there shall be added to such taxable income all expenses deducted on the taxpayer’s return for the taxable year which are attributable, directly or indirectly, to such subtracted amount.

Further, no amount shall be subtracted with respect to dividends paid or deemed paid by a Domestic International Sales Corporation.

3. In computing “adjusted federal income” for taxable years beginning after December 31, 1976, there shall be allowed as a deduction the amount of wages and salaries paid or incurred within this state for the taxable year for which no deduction is allowed pursuant to s.

280C(a) of the Internal Revenue Code (relating to credit for employment of certain new employees).

4. There shall be subtracted from such taxable income any amount of nonbusiness income included therein.

5. There shall be subtracted any amount of taxes of foreign countries allowable as credits for taxable years beginning on or after September 1, 1985, under s.

901 of the Internal Revenue Code to any corporation which derived less than 20 percent of its gross income or loss for its taxable year ended in 1984 from sources within the United States, as described in s.

861(a)(2)(A) of the Internal Revenue Code, not including credits allowed under ss.

902 and 960 of the Internal Revenue Code, withholding taxes on dividends within the meaning of sub subparagraph 2.a., and withholding taxes on royalties, interest, technical service fees, and capital gains.

6. Notwithstanding any other provision of this code, except with respect to amounts subtracted pursuant to subparagraphs 1.

and 3., any increment of any apportionment factor which is directly related to an increment of gross receipts or income which is deducted, subtracted, or otherwise excluded in determining adjusted federal income shall be excluded from both the numerator and denominator of such apportionment factor.

Further, all valuations made for apportionment factor purposes shall be made on a basis consistent with the taxpayer’s method of accounting for federal income tax purposes.

Section 5. The amendment made by this act to s.

220.13, Florida Statutes, applies to taxable years beginning on or after January 1, 2018.

Section 6. Section 220.27, Florida Statutes, is created to read:

220.27 Additional required information.— (1)(a) Every taxpayer that is required to file a return under s.

220.22(1) for a taxable year beginning during the 2018 or 2019 calendar years must submit to the department the following information for those taxable years using the online application on the department’s website:

1. The taxpayer’s name, federal taxpayer identification number, taxable year beginning date, taxable year ending date, and whether a consolidated return for the taxpayer is required or elected under s.

220.131.

2. The taxpayer’s NAICS code for business activity that generates the greatest proportion of gross receipts of the taxpayer.

As used in this subparagraph, the term “NAICS” means those classifications contained in the North American Industry Classification System, as published in 2007 by the Office of Management and Budget, Executive Office of the President.

3. The taxpayer’s taxable income, as that term is defined in s.

220.13(2), and the taxpayer’s state apportionment fraction pursuant to s.

220.15 for the taxable year.

4. The amount of global intangible low-taxed income included in federal taxable income under s.

951A of the Internal Revenue Code, and the amount of the related deduction under s.

250 of the Internal Revenue Code as it pertains to s.

951A of the Internal Revenue Code.

5. The amount of foreign-derived intangible income computed for the federal return for the taxable year and the amount of the related deduction under s.

250 of the Internal Revenue Code, as it pertains to foreign-derived intangible income.

6. The amount of business interest expense deducted on the federal return under s.

163 of the Internal Revenue Code, including any carryover;

the amount of current year business interest expense, including any carryover, which was not deducted due to the limitation in s.

163(j) of the Internal Revenue Code;

and the amount of business interest expense carried over from previous taxable years.

7. The amount of federal net operating loss deduction under s.

172 of the Internal Revenue Code applied in determining federal taxable income and the amount of federal net operating loss carryover that was not applied due to the limitation in s.

172(a)(2) of the Internal Revenue Code.

8. The total amount of state net operating loss carryover available after the filing of the return for the taxable year.

9. The total amount of the state alternative minimum tax credit carryover available after the filing of the return for the taxable year.

(b) By September 3, 2019, the department shall create a secure online application for use by taxpayers when submitting the information required under this subsection through the department’s website.

(c) An officer of the taxpayer or a person duly authorized to act on the taxpayer’s behalf shall certify that the information submitted pursuant to this subsection is true and correct.

The required information must be submitted the earlier of 10 days after the extended due date of the tax return or 10 days after the date such return is filed.

For taxpayers that file returns before September 3, 2019, for taxable years beginning in calendar year 2018, the required information is timely if submitted by September 3, 2019.

(d) In addition to its existing audit and investigation authority, the department may perform any additional financial and technical audits and investigations, including examining the accounts, books, and financial records of the taxpayer, which are necessary to verify the accuracy of the information submitted pursuant to this subsection.

(e) A taxpayer who fails to provide the required information by the required submission date is subject to a penalty of $1,000 or 1 percent of the tax determined to be due under this chapter for the most recent taxable year reported on a return filed with the department, whichever is greater.

Any such penalty collected must be deposited into the General Revenue Fund.

The department may settle or compromise such penalty if the department determines that the noncompliance is due to reasonable cause and not to willful negligence, willful neglect, or fraud.

(2) This section expires January 1, 2023.

Section 7. (1) The Department of Revenue is authorized, and all conditions are deemed to be met, to adopt emergency rules pursuant to s.

120.54(4), Florida Statutes, for the purpose of implementing this act.

(2) Notwithstanding any other law, emergency rules adopted pursuant to subsection (1) are effective for 6 months after adoption and may be renewed during the pendency of procedures to adopt permanent rules addressing the subject of the emergency rules.

(3) This section expires January 1, 2022.

Section 8. For the 2019-2020 fiscal year, the sum of $120,000 in nonrecurring funds is appropriated from the General Revenue Fund to the Department of Revenue for the purpose of implementing this act.

Section 9. This act shall take effect upon becoming a law.