Bill Text: FL S0576 | 2019 | Regular Session | Comm Sub
Bill Title: Corporate Income Tax
Spectrum: Bipartisan Bill
Status: (Introduced - Dead) 2019-05-01 - Laid on Table, companion bill(s) passed, see HB 7127 (Ch. 2019-168) [S0576 Detail]
Download: Florida-2019-S0576-Comm_Sub.html
Florida Senate - 2019 CS for CS for SB 576 By the Committees on Appropriations; and Finance and Tax; and Senators Perry and Flores 576-04596-19 2019576c2 1 A bill to be entitled 2 An act relating to the corporate income tax; amending 3 s. 220.03, F.S.; adopting the Internal Revenue Code in 4 effect on January 1, 2019; providing applicability; 5 amending s. 220.1105, F.S.; revising definitions; 6 deleting provisions providing for a rate adjustment; 7 providing for refunds of certain corporate income tax 8 receipts in a certain fiscal year; revising 9 requirements for the Department of Revenue in making 10 certain determinations and in refunding eligible 11 taxpayers; amending s. 220.13, F.S.; providing for the 12 subtraction of global intangible low-taxed income from 13 taxable income for the purpose of determining adjusted 14 federal income; specifying the extent to which certain 15 amounts may be subtracted; providing applicability; 16 creating s. 220.27, F.S.; requiring taxpayers filing 17 returns during a certain timeframe to submit specified 18 information to the department by certain means; 19 defining the term “NAICS”; requiring the department, 20 by a certain date, to create a secure online 21 application for submitting such information; requiring 22 certain persons to certify the information is true and 23 correct; specifying deadlines for submitting the 24 information; authorizing the department to perform 25 certain audits and investigations; providing a penalty 26 for failure to provide the information; requiring the 27 penalty to be deposited into the General Revenue Fund; 28 authorizing the department to settle or compromise the 29 penalty under certain circumstances; providing for 30 expiration; authorizing the department to adopt 31 emergency rules; providing for expiration of the 32 authorization; providing an appropriation; providing 33 an effective date. 34 35 Be It Enacted by the Legislature of the State of Florida: 36 37 Section 1. Paragraph (n) of subsection (1) and paragraph 38 (c) of subsection (2) of section 220.03, Florida Statutes, are 39 amended to read: 40 220.03 Definitions.— 41 (1) SPECIFIC TERMS.—When used in this code, and when not 42 otherwise distinctly expressed or manifestly incompatible with 43 the intent thereof, the following terms shall have the following 44 meanings: 45 (n) “Internal Revenue Code” means the United States 46 Internal Revenue Code of 1986, as amended and in effect on 47 January 1, 20192018, except as provided in subsection (3). 48 (2) DEFINITIONAL RULES.—When used in this code and neither 49 otherwise distinctly expressed nor manifestly incompatible with 50 the intent thereof: 51 (c) Any term used in this code has the same meaning as when 52 used in a comparable context in the Internal Revenue Code and 53 other statutes of the United States relating to federal income 54 taxes, as such code and statutes are in effect on January 1, 55 20192018. However, if subsection (3) is implemented, the 56 meaning of a term shall be taken at the time the term is applied 57 under this code. 58 Section 2. The amendment made by this act to s. 220.03, 59 Florida Statutes, applies to taxable years beginning on or after 60 January 1, 2019. 61 Section 3. Section 220.1105, Florida Statutes, is amended 62 to read: 63 220.1105Tax imposed;Automatic refundsand downward64adjustments to tax rates.— 65 (1) As used in this section, the term: 66 (a) “Net collections” means the total amount of taxes 67 collected under this chapter by the department in athe 2018682019fiscal year, including related interest and penalties, 69 minus the total amount of refunds of taxes levied under this 70 chapter and issued by the department in that fiscal year, not 71 including refunds issued pursuant to paragraph (2)(c). No later 72 than September 1, 2019, and September 1, 2020, the Office of 73 Economic and Demographic Research shall determine net 74 collections for the most recent2018-2019fiscal year. 75 (b) “Forecasted net collections” means the amount of net 76 collections forecasted for athe 2018-2019fiscal year by the 77 Revenue Estimating Conference on February 23, 2018. 78 (c) “Adjusted forecasted collections” means forecasted net 79 collections for athe 2018-2019fiscal year multiplied by 1.07. 80(d) “Tax rate imposed” is the tax rate as defined in ss.81220.11(2) and 220.63(2) adjusted as set forth in this section.82(2) The tax rate imposed shall be adjusted based on net83collections in the 2018-2019 fiscal year. If the net collections84exceed the adjusted forecasted collections, the tax rate imposed85for taxable years beginning on or after January 1, 2019, shall86be the tax rate imposed for taxable years beginning on or after87January 1, 2018, multiplied by the quotient of the adjusted88forecasted collections divided by the net collections. The89resulting tax rate shall be rounded to the nearest thousandth90and rounded down if the fourth digit to the right of the decimal91point is the number five.92(3) By October 1, 2019, the Department of Revenue shall93calculate the tax rate imposed, if it is to be adjusted pursuant94to subsection (2), and shall on that same date report the95results of such calculation to the Governor, the President of96the Senate, and the Speaker of the House of Representatives.97 (2)(4)For the 2018-2019 and 2019-2020 fiscal years, any 98 amount by which net collections for the fiscal year exceed 99 adjusted forecasted collections for the same2018-2019fiscal 100 year shall only be used to provide refunds to corporate income 101 tax payers as follows: 102 (a) For purposes of this subsection: 103 1. “Eligible taxpayer for a fiscal year” means: 104 a. For the 2018-2019 fiscal year, a taxpayer whose taxable 105 year begins between April 1, 2017, and March 31, 2018, and whose 106 final tax liability for such taxable year is greater than zero. 107 b. For the 2019-2020 fiscal year, a taxpayer whose taxable 108 year begins between April 1, 2018, and March 31, 2019, and whose 109 final tax liability for such taxable year is greater than zero. 110 2. “Excess collections for a fiscal year” means the amount 111 by which net collections for a fiscalthe 2018-2019year exceed 112 adjusted forecasted collections for that fiscal year. 113 3. “Final tax liability” means the taxpayer’s amount of tax 114 due under this chapter for a taxable year, reported on a return 115 filed with the department pursuant to s. 220.222, including a 116 return filed timely pursuant to a valid extension. 117 4. “Total eligible tax liability for a fiscal year” means 118 the sum of final tax liabilities of all eligible taxpayers for a 119 fiscal year, as such liabilities are shown on the latest return 120 filed with the department as of the February 1 immediately 121 following that fiscal year. 122 5. “Taxpayer refund share for a fiscal year” means an 123 eligible taxpayer’s final tax liability as a percentage of the 124 total eligible tax liability for that fiscal year. 125 6. “Taxpayer refund for a fiscal year” means the taxpayer 126 refund share for a fiscal year multiplied by the excess 127 collections for that fiscal year. 128 (b) No later than April 15 following a fiscal yearFebruary12915, 2020, the department shall determine total eligible tax 130 liability for that fiscal year, the taxpayer refund share for 131 that fiscal year for each eligible taxpayer, and the taxpayer 132 refund for that fiscal year for each eligible taxpayer. 133 (c) No later than May 1 following a fiscal yearMarch 1,1342020, the department shall refund a taxpayer refund for that 135 fiscal year to each eligible taxpayer. 136(5) Tax rate adjustments pursuant to this section are137repealed for taxable years beginning on or after January 1,1382020.139 Section 4. Paragraph (b) of subsection (1) of section 140 220.13, Florida Statutes, is amended to read: 141 220.13 “Adjusted federal income” defined.— 142 (1) The term “adjusted federal income” means an amount 143 equal to the taxpayer’s taxable income as defined in subsection 144 (2), or such taxable income of more than one taxpayer as 145 provided in s. 220.131, for the taxable year, adjusted as 146 follows: 147 (b) Subtractions.— 148 1. There shall be subtracted from such taxable income: 149 a. The net operating loss deduction allowable for federal 150 income tax purposes under s. 172 of the Internal Revenue Code 151 for the taxable year, except that any net operating loss that is 152 transferred pursuant to s. 220.194(6) may not be deducted by the 153 seller, 154 b. The net capital loss allowable for federal income tax 155 purposes under s. 1212 of the Internal Revenue Code for the 156 taxable year, 157 c. The excess charitable contribution deduction allowable 158 for federal income tax purposes under s. 170(d)(2) of the 159 Internal Revenue Code for the taxable year, and 160 d. The excess contributions deductions allowable for 161 federal income tax purposes under s. 404 of the Internal Revenue 162 Code for the taxable year. 163 164 However, a net operating loss and a capital loss shall never be 165 carried back as a deduction to a prior taxable year, but all 166 deductions attributable to such losses shall be deemed net 167 operating loss carryovers and capital loss carryovers, 168 respectively, and treated in the same manner, to the same 169 extent, and for the same time periods as are prescribed for such 170 carryovers in ss. 172 and 1212, respectively, of the Internal 171 Revenue Code. 172 2. There shall be subtracted from such taxable income any 173 amount to the extent included therein the following: 174 a. Dividends treated as received from sources without the 175 United States, as determined under s. 862 of the Internal 176 Revenue Code. 177 b. All amounts included in taxable income under s. 78,or178 s. 951, or s. 951A of the Internal Revenue Code. 179 180 However, any amount subtracted under this subparagraph shall 181 only be allowed to the extent that such amount is not deductible 182 in determining federal taxable income. As to any amount 183 subtracted under this subparagraph, there shall be added to such 184 taxable income all expenses deducted on the taxpayer’s return 185 for the taxable year which are attributable, directly or 186 indirectly, to such subtracted amount. Further, no amount shall 187 be subtracted with respect to dividends paid or deemed paid by a 188 Domestic International Sales Corporation. 189 3. In computing “adjusted federal income” for taxable years 190 beginning after December 31, 1976, there shall be allowed as a 191 deduction the amount of wages and salaries paid or incurred 192 within this state for the taxable year for which no deduction is 193 allowed pursuant to s. 280C(a) of the Internal Revenue Code 194 (relating to credit for employment of certain new employees). 195 4. There shall be subtracted from such taxable income any 196 amount of nonbusiness income included therein. 197 5. There shall be subtracted any amount of taxes of foreign 198 countries allowable as credits for taxable years beginning on or 199 after September 1, 1985, under s. 901 of the Internal Revenue 200 Code to any corporation which derived less than 20 percent of 201 its gross income or loss for its taxable year ended in 1984 from 202 sources within the United States, as described in s. 203 861(a)(2)(A) of the Internal Revenue Code, not including credits 204 allowed under ss. 902 and 960 of the Internal Revenue Code, 205 withholding taxes on dividends within the meaning of sub 206 subparagraph 2.a., and withholding taxes on royalties, interest, 207 technical service fees, and capital gains. 208 6. Notwithstanding any other provision of this code, except 209 with respect to amounts subtracted pursuant to subparagraphs 1. 210 and 3., any increment of any apportionment factor which is 211 directly related to an increment of gross receipts or income 212 which is deducted, subtracted, or otherwise excluded in 213 determining adjusted federal income shall be excluded from both 214 the numerator and denominator of such apportionment factor. 215 Further, all valuations made for apportionment factor purposes 216 shall be made on a basis consistent with the taxpayer’s method 217 of accounting for federal income tax purposes. 218 Section 5. The amendment made by this act to s. 220.13, 219 Florida Statutes, applies to taxable years beginning on or after 220 January 1, 2018. 221 Section 6. Section 220.27, Florida Statutes, is created to 222 read: 223 220.27 Additional required information.— 224 (1)(a) Every taxpayer that is required to file a return 225 under s. 220.22(1) for a taxable year beginning during the 2018 226 or 2019 calendar years must submit to the department the 227 following information for those taxable years using the online 228 application on the department’s website: 229 1. The taxpayer’s name, federal taxpayer identification 230 number, taxable year beginning date, taxable year ending date, 231 and whether a consolidated return for the taxpayer is required 232 or elected under s. 220.131. 233 2. The taxpayer’s NAICS code for business activity that 234 generates the greatest proportion of gross receipts of the 235 taxpayer. As used in this subparagraph, the term “NAICS” means 236 those classifications contained in the North American Industry 237 Classification System, as published in 2007 by the Office of 238 Management and Budget, Executive Office of the President. 239 3. The taxpayer’s taxable income, as that term is defined 240 in s. 220.13(2), and the taxpayer’s state apportionment fraction 241 pursuant to s. 220.15 for the taxable year. 242 4. The amount of global intangible low-taxed income 243 included in federal taxable income under s. 951A of the Internal 244 Revenue Code, and the amount of the related deduction under s. 245 250 of the Internal Revenue Code as it pertains to s. 951A of 246 the Internal Revenue Code. 247 5. The amount of foreign-derived intangible income computed 248 for the federal return for the taxable year and the amount of 249 the related deduction under s. 250 of the Internal Revenue Code, 250 as it pertains to foreign-derived intangible income. 251 6. The amount of business interest expense deducted on the 252 federal return under s. 163 of the Internal Revenue Code, 253 including any carryover; the amount of current year business 254 interest expense, including any carryover, which was not 255 deducted due to the limitation in s. 163(j) of the Internal 256 Revenue Code; and the amount of business interest expense 257 carried over from previous taxable years. 258 7. The amount of federal net operating loss deduction under 259 s. 172 of the Internal Revenue Code applied in determining 260 federal taxable income and the amount of federal net operating 261 loss carryover that was not applied due to the limitation in s. 262 172(a)(2) of the Internal Revenue Code. 263 8. The total amount of state net operating loss carryover 264 available after the filing of the return for the taxable year. 265 9. The total amount of the state alternative minimum tax 266 credit carryover available after the filing of the return for 267 the taxable year. 268 (b) By September 3, 2019, the department shall create a 269 secure online application for use by taxpayers when submitting 270 the information required under this subsection through the 271 department’s website. 272 (c) An officer of the taxpayer or a person duly authorized 273 to act on the taxpayer’s behalf shall certify that the 274 information submitted pursuant to this subsection is true and 275 correct. The required information must be submitted the earlier 276 of 10 days after the extended due date of the tax return or 10 277 days after the date such return is filed. For taxpayers that 278 file returns before September 3, 2019, for taxable years 279 beginning in calendar year 2018, the required information is 280 timely if submitted by September 3, 2019. 281 (d) In addition to its existing audit and investigation 282 authority, the department may perform any additional financial 283 and technical audits and investigations, including examining the 284 accounts, books, and financial records of the taxpayer, which 285 are necessary to verify the accuracy of the information 286 submitted pursuant to this subsection. 287 (e) A taxpayer who fails to provide the required 288 information by the required submission date is subject to a 289 penalty of $1,000 or 1 percent of the tax determined to be due 290 under this chapter for the most recent taxable year reported on 291 a return filed with the department, whichever is greater. Any 292 such penalty collected must be deposited into the General 293 Revenue Fund. The department may settle or compromise such 294 penalty if the department determines that the noncompliance is 295 due to reasonable cause and not to willful negligence, willful 296 neglect, or fraud. 297 (2) This section expires January 1, 2023. 298 Section 7. (1) The Department of Revenue is authorized, and 299 all conditions are deemed to be met, to adopt emergency rules 300 pursuant to s. 120.54(4), Florida Statutes, for the purpose of 301 implementing this act. 302 (2) Notwithstanding any other law, emergency rules adopted 303 pursuant to subsection (1) are effective for 6 months after 304 adoption and may be renewed during the pendency of procedures to 305 adopt permanent rules addressing the subject of the emergency 306 rules. 307 (3) This section expires January 1, 2022. 308 Section 8. For the 2019-2020 fiscal year, the sum of 309 $120,000 in nonrecurring funds is appropriated from the General 310 Revenue Fund to the Department of Revenue for the purpose of 311 implementing this act. 312 Section 9. This act shall take effect upon becoming a law.