Florida Senate - 2020                                    SB 1596
       
       
        
       By Senator Rodriguez
       
       
       
       
       
       37-00418-20                                           20201596__
    1                        A bill to be entitled                      
    2         An act relating to the corporate income tax; amending
    3         s. 220.03, F.S.; revising the definition of the term
    4         “taxpayer”; defining terms; amending s. 220.13, F.S.;
    5         revising the definition of the term “adjusted federal
    6         income” to prohibit specified deductions, to limit
    7         certain carryovers, and to require subtractions of
    8         certain amounts paid and received within a water’s
    9         edge group for the purpose of determining subtractions
   10         from taxable income; conforming provisions to changes
   11         made by the act; repealing s. 220.131, F.S., relating
   12         to the adjusted federal income of affiliated groups;
   13         creating s. 220.136, F.S.; specifying circumstances
   14         under which a corporation is presumed to be, deemed to
   15         be, or deemed not to be a member of a water’s edge
   16         group; defining the term “United States”; providing
   17         construction; creating s. 220.1363, F.S.; defining the
   18         term “water’s edge reporting method”; specifying
   19         requirements for, limitations on, and prohibitions in
   20         calculating and reporting income in a water’s edge
   21         group return; requiring all members of a water’s edge
   22         group to use the water’s edge reporting method;
   23         defining the term “sale”; specifying requirements for
   24         designating the filing member and the taxable year of
   25         the water’s edge group; specifying income reporting
   26         requirements for certain members of the water’s edge
   27         group; requiring that a water’s edge group return
   28         include a specified computational schedule and
   29         domestic disclosure spreadsheet; authorizing the
   30         Department of Revenue to adopt rules; providing
   31         legislative intent regarding the adoption of rules;
   32         amending s. 220.14, F.S.; revising the calculation for
   33         prorating a certain corporate income tax exemption to
   34         reflect leap years; conforming a provision to changes
   35         made by the act; amending ss. 220.15, 220.183,
   36         220.1845, 220.1875, 220.191, 220.193, and 220.27,
   37         F.S.; conforming provisions to changes made by the
   38         act; creating s. 220.28, F.S.; specifying, for certain
   39         taxpayers and for taxable years beginning on a
   40         specified date, requirements in filing corporate tax
   41         returns; amending s. 220.51, F.S.; conforming
   42         provisions to changes made by the act; amending s.
   43         220.64, F.S.; providing applicability of water’s edge
   44         group provisions to the franchise tax; conforming
   45         provisions to changes made by the act; amending ss.
   46         288.1254 and 376.30781, F.S.; conforming provisions to
   47         changes made by the act; requiring that funds
   48         recaptured pursuant to this act be appropriated for a
   49         certain purpose; providing an effective date.
   50  
   51         WHEREAS, the Legislature finds that the separate accounting
   52  system used to measure the income of multistate and
   53  multinational corporations for tax purposes often places Florida
   54  corporations at a competitive disadvantage and, moreover, that
   55  corporate business is increasingly conducted through groups of
   56  commonly owned corporations, and
   57         WHEREAS, the Legislature intends to more accurately measure
   58  the business activities of corporations by adopting a combined
   59  system of income tax reporting, NOW, THEREFORE,
   60  
   61  Be It Enacted by the Legislature of the State of Florida:
   62  
   63         Section 1. Paragraph (z) of subsection (1) of section
   64  220.03, Florida Statutes, is amended, and paragraphs (gg), (hh),
   65  and (ii) are added to that subsection, to read:
   66         220.03 Definitions.—
   67         (1) SPECIFIC TERMS.—When used in this code, and when not
   68  otherwise distinctly expressed or manifestly incompatible with
   69  the intent thereof, the following terms shall have the following
   70  meanings:
   71         (z) “Taxpayer” means any corporation subject to the tax
   72  imposed by this code, and includes all corporations that are
   73  members of a water’s edge group for which a consolidated return
   74  is filed under s. 220.131. However, the term “taxpayer” does not
   75  include a corporation having no individuals, (including
   76  individuals employed by an affiliate,) receiving compensation in
   77  this state as defined in s. 220.15 when the only property owned
   78  or leased by the said corporation, (including an affiliate,) in
   79  this state is located at the premises of a printer with which it
   80  has contracted for printing, if such property consists of the
   81  final printed product, property which becomes a part of the
   82  final printed product, or property from which the printed
   83  product is produced.
   84         (gg)“Tax haven” means a jurisdiction to which any of the
   85  following apply for a particular taxable year:
   86         1. It is identified by the Organization for Economic Co
   87  operation and Development as a tax haven or as having harmful
   88  tax practices or a preferential tax regime.
   89         2.It is a jurisdiction that does not impose any, or
   90  imposes only a nominal, effective tax on relevant income.
   91         3.It has laws or practices that prevent the effective
   92  exchange of information for tax purposes with other governments
   93  regarding taxpayers who are subject to, or who are benefiting
   94  from, the tax regime.
   95         4.It lacks transparency. For purposes of this
   96  subparagraph, a tax regime lacks transparency if the details of
   97  legislative, legal, or administrative requirements are not open
   98  to public scrutiny and apparent or are not consistently applied
   99  among similarly situated taxpayers.
  100         5.It facilitates the establishment of foreign-owned
  101  entities without the need for a local substantive presence or
  102  prohibits the entities from having any commercial impact on the
  103  local economy.
  104         6.It explicitly or implicitly excludes the jurisdiction’s
  105  resident taxpayers from taking advantage of the tax regime’s
  106  benefits or prohibits enterprises that benefit from the regime
  107  from operating in the jurisdiction’s domestic market.
  108         7.It has created a tax regime that is favorable for tax
  109  avoidance based on an overall assessment of relevant factors,
  110  including whether the jurisdiction has a significant untaxed
  111  offshore financial or other services sector relative to its
  112  overall economy.
  113         (hh)Tax regime” means a set or system of rules, laws,
  114  regulations, or practices by which taxes are imposed on any
  115  person, corporation, or entity or on any income, property,
  116  incident, indicia, or activity pursuant to government authority.
  117         (ii)“Water’s edge group” means a group of corporations
  118  related through common ownership whose business activities are
  119  integrated with, are dependent upon, or contribute to a flow of
  120  value among members of the group.
  121         Section 2. Section 220.13, Florida Statutes, is amended to
  122  read:
  123         220.13 “Adjusted federal income” defined.—
  124         (1) The term “adjusted federal income” means an amount
  125  equal to the taxpayer’s taxable income as defined in subsection
  126  (2), or such taxable income of a water’s edge group more than
  127  one taxpayer as provided in s. 220.1363 s. 220.131, for the
  128  taxable year, adjusted as follows:
  129         (a) Additions.—There shall be added to such taxable income:
  130         1.a. The amount of any tax upon or measured by income,
  131  excluding taxes based on gross receipts or revenues, paid or
  132  accrued as a liability to the District of Columbia or any state
  133  of the United States which is deductible from gross income in
  134  the computation of taxable income for the taxable year.
  135         b. Notwithstanding sub-subparagraph a., if a credit taken
  136  under s. 220.1875 is added to taxable income in a previous
  137  taxable year under subparagraph 11. and is taken as a deduction
  138  for federal tax purposes in the current taxable year, the amount
  139  of the deduction allowed shall not be added to taxable income in
  140  the current year. The exception in this sub-subparagraph is
  141  intended to ensure that the credit under s. 220.1875 is added in
  142  the applicable taxable year and does not result in a duplicate
  143  addition in a subsequent year.
  144         2. The amount of interest which is excluded from taxable
  145  income under s. 103(a) of the Internal Revenue Code or any other
  146  federal law, less the associated expenses disallowed in the
  147  computation of taxable income under s. 265 of the Internal
  148  Revenue Code or any other law, excluding 60 percent of any
  149  amounts included in alternative minimum taxable income, as
  150  defined in s. 55(b)(2) of the Internal Revenue Code, if the
  151  taxpayer pays tax under s. 220.11(3).
  152         3. In the case of a regulated investment company or real
  153  estate investment trust, an amount equal to the excess of the
  154  net long-term capital gain for the taxable year over the amount
  155  of the capital gain dividends attributable to the taxable year.
  156         4. That portion of the wages or salaries paid or incurred
  157  for the taxable year which is equal to the amount of the credit
  158  allowable for the taxable year under s. 220.181. This
  159  subparagraph shall expire on the date specified in s. 290.016
  160  for the expiration of the Florida Enterprise Zone Act.
  161         5. That portion of the ad valorem school taxes paid or
  162  incurred for the taxable year which is equal to the amount of
  163  the credit allowable for the taxable year under s. 220.182. This
  164  subparagraph shall expire on the date specified in s. 290.016
  165  for the expiration of the Florida Enterprise Zone Act.
  166         6. The amount taken as a credit under s. 220.195 which is
  167  deductible from gross income in the computation of taxable
  168  income for the taxable year.
  169         7. That portion of assessments to fund a guaranty
  170  association incurred for the taxable year which is equal to the
  171  amount of the credit allowable for the taxable year.
  172         8. In the case of a nonprofit corporation which holds a
  173  pari-mutuel permit and which is exempt from federal income tax
  174  as a farmers’ cooperative, an amount equal to the excess of the
  175  gross income attributable to the pari-mutuel operations over the
  176  attributable expenses for the taxable year.
  177         9. The amount taken as a credit for the taxable year under
  178  s. 220.1895.
  179         10. Up to nine percent of the eligible basis of any
  180  designated project which is equal to the credit allowable for
  181  the taxable year under s. 220.185.
  182         11. The amount taken as a credit for the taxable year under
  183  s. 220.1875. The addition in this subparagraph is intended to
  184  ensure that the same amount is not allowed for the tax purposes
  185  of this state as both a deduction from income and a credit
  186  against the tax. This addition is not intended to result in
  187  adding the same expense back to income more than once.
  188         12. The amount taken as a credit for the taxable year under
  189  s. 220.192.
  190         13. The amount taken as a credit for the taxable year under
  191  s. 220.193.
  192         14. Any portion of a qualified investment, as defined in s.
  193  288.9913, which is claimed as a deduction by the taxpayer and
  194  taken as a credit against income tax pursuant to s. 288.9916.
  195         15. The costs to acquire a tax credit pursuant to s.
  196  288.1254(5) that are deducted from or otherwise reduce federal
  197  taxable income for the taxable year.
  198         16. The amount taken as a credit for the taxable year
  199  pursuant to s. 220.194.
  200         17. The amount taken as a credit for the taxable year under
  201  s. 220.196. The addition in this subparagraph is intended to
  202  ensure that the same amount is not allowed for the tax purposes
  203  of this state as both a deduction from income and a credit
  204  against the tax. The addition is not intended to result in
  205  adding the same expense back to income more than once.
  206         (b) Subtractions.—
  207         1. There shall be subtracted from such taxable income:
  208         a. The net operating loss deduction allowable for federal
  209  income tax purposes under s. 172 of the Internal Revenue Code
  210  for the taxable year, except that any net operating loss that is
  211  transferred pursuant to s. 220.194(6) may not be deducted by the
  212  seller,
  213         b. The net capital loss allowable for federal income tax
  214  purposes under s. 1212 of the Internal Revenue Code for the
  215  taxable year,
  216         c. The excess charitable contribution deduction allowable
  217  for federal income tax purposes under s. 170(d)(2) of the
  218  Internal Revenue Code for the taxable year, and
  219         d. The excess contributions deductions allowable for
  220  federal income tax purposes under s. 404 of the Internal Revenue
  221  Code for the taxable year.
  222  
  223  However, a net operating loss and a capital loss shall never be
  224  carried back as a deduction to a prior taxable year, but all
  225  deductions attributable to such losses shall be deemed net
  226  operating loss carryovers and capital loss carryovers,
  227  respectively, and treated in the same manner, to the same
  228  extent, and for the same time periods as are prescribed for such
  229  carryovers in ss. 172 and 1212, respectively, of the Internal
  230  Revenue Code. A deduction is not allowed for net operating
  231  losses, net capital losses, or excess contribution deductions
  232  under 26 U.S.C. ss. 170(d)(2), 172, 1212, and 404 for a member
  233  of a water’s edge group which is not a United States member.
  234  Carryovers of net operating losses, net capital losses, or
  235  excess contribution deductions under 26 U.S.C. ss. 170(d)(2),
  236  172, 1212, and 404 may be subtracted only by the member of the
  237  water’s edge group which generates a carryover.
  238         2. There shall be subtracted from such taxable income any
  239  amount to the extent included therein the following:
  240         a. Dividends treated as received from sources without the
  241  United States, as determined under s. 862 of the Internal
  242  Revenue Code.
  243         b. All amounts included in taxable income under s. 78, s.
  244  951, or s. 951A of the Internal Revenue Code.
  245  
  246  However, any amount subtracted under this subparagraph is
  247  allowed only to the extent such amount is not deductible in
  248  determining federal taxable income. As to any amount subtracted
  249  under this subparagraph, there shall be added to such taxable
  250  income all expenses deducted on the taxpayer’s return for the
  251  taxable year which are attributable, directly or indirectly, to
  252  such subtracted amount. Further, no amount shall be subtracted
  253  with respect to dividends paid or deemed paid by a Domestic
  254  International Sales Corporation.
  255         3.Amounts received by a member of a water’s edge group as
  256  dividends paid by another member of the water’s edge group must
  257  be subtracted from the taxable income to the extent that the
  258  dividends are included in the taxable income.
  259         4.3. In computing “adjusted federal income” for taxable
  260  years beginning after December 31, 1976, there shall be allowed
  261  as a deduction the amount of wages and salaries paid or incurred
  262  within this state for the taxable year for which no deduction is
  263  allowed pursuant to s. 280C(a) of the Internal Revenue Code
  264  (relating to credit for employment of certain new employees).
  265         5.4. There shall be subtracted from such taxable income any
  266  amount of nonbusiness income included therein.
  267         6.5. There shall be subtracted any amount of taxes of
  268  foreign countries allowable as credits for taxable years
  269  beginning on or after September 1, 1985, under s. 901 of the
  270  Internal Revenue Code to any corporation which derived less than
  271  20 percent of its gross income or loss for its taxable year
  272  ended in 1984 from sources within the United States, as
  273  described in s. 861(a)(2)(A) of the Internal Revenue Code, not
  274  including credits allowed under ss. 902 and 960 of the Internal
  275  Revenue Code, withholding taxes on dividends within the meaning
  276  of sub-subparagraph 2.a., and withholding taxes on royalties,
  277  interest, technical service fees, and capital gains.
  278         7.6. Notwithstanding any other provision of this code,
  279  except with respect to amounts subtracted pursuant to
  280  subparagraphs 1. and 4. 3., any increment of any apportionment
  281  factor which is directly related to an increment of gross
  282  receipts or income which is deducted, subtracted, or otherwise
  283  excluded in determining adjusted federal income shall be
  284  excluded from both the numerator and denominator of such
  285  apportionment factor. Further, all valuations made for
  286  apportionment factor purposes shall be made on a basis
  287  consistent with the taxpayer’s method of accounting for federal
  288  income tax purposes.
  289         (c) Installment sales occurring after October 19, 1980.—
  290         1. In the case of any disposition made after October 19,
  291  1980, the income from an installment sale shall be taken into
  292  account for the purposes of this code in the same manner that
  293  such income is taken into account for federal income tax
  294  purposes.
  295         2. Any taxpayer who regularly sells or otherwise disposes
  296  of personal property on the installment plan and reports the
  297  income therefrom on the installment method for federal income
  298  tax purposes under s. 453(a) of the Internal Revenue Code shall
  299  report such income in the same manner under this code.
  300         (d) Nonallowable deductions.—A deduction for net operating
  301  losses, net capital losses, or excess contributions deductions
  302  under ss. 170(d)(2), 172, 1212, and 404 of the Internal Revenue
  303  Code which has been allowed in a prior taxable year for Florida
  304  tax purposes shall not be allowed for Florida tax purposes,
  305  notwithstanding the fact that such deduction has not been fully
  306  utilized for federal tax purposes.
  307         (e) Adjustments related to federal acts.—Taxpayers shall be
  308  required to make the adjustments prescribed in this paragraph
  309  for Florida tax purposes with respect to certain tax benefits
  310  received pursuant to the Economic Stimulus Act of 2008, the
  311  American Recovery and Reinvestment Act of 2009, the Small
  312  Business Jobs Act of 2010, the Tax Relief, Unemployment
  313  Insurance Reauthorization, and Job Creation Act of 2010, the
  314  American Taxpayer Relief Act of 2012, the Tax Increase
  315  Prevention Act of 2014, the Consolidated Appropriations Act,
  316  2016, and the Tax Cuts and Jobs Act of 2017.
  317         1. There shall be added to such taxable income an amount
  318  equal to 100 percent of any amount deducted for federal income
  319  tax purposes as bonus depreciation for the taxable year pursuant
  320  to ss. 167 and 168(k) of the Internal Revenue Code of 1986, as
  321  amended by s. 103 of Pub. L. No. 110-185, s. 1201 of Pub. L. No.
  322  111-5, s. 2022 of Pub. L. No. 111-240, s. 401 of Pub. L. No.
  323  111-312, s. 331 of Pub. L. No. 112-240, s. 125 of Pub. L. No.
  324  113-295, s. 143 of Division Q of Pub. L. No. 114-113, and s.
  325  13201 of Pub. L. No. 115-97, for property placed in service
  326  after December 31, 2007, and before January 1, 2027. For the
  327  taxable year and for each of the 6 subsequent taxable years,
  328  there shall be subtracted from such taxable income an amount
  329  equal to one-seventh of the amount by which taxable income was
  330  increased pursuant to this subparagraph, notwithstanding any
  331  sale or other disposition of the property that is the subject of
  332  the adjustments and regardless of whether such property remains
  333  in service in the hands of the taxpayer.
  334         2. There shall be added to such taxable income an amount
  335  equal to 100 percent of any amount in excess of $128,000
  336  deducted for federal income tax purposes for the taxable year
  337  pursuant to s. 179 of the Internal Revenue Code of 1986, as
  338  amended by s. 102 of Pub. L. No. 110-185, s. 1202 of Pub. L. No.
  339  111-5, s. 2021 of Pub. L. No. 111-240, s. 402 of Pub. L. No.
  340  111-312, s. 315 of Pub. L. No. 112-240, and s. 127 of Pub. L.
  341  No. 113-295, for taxable years beginning after December 31,
  342  2007, and before January 1, 2015. For the taxable year and for
  343  each of the 6 subsequent taxable years, there shall be
  344  subtracted from such taxable income one-seventh of the amount by
  345  which taxable income was increased pursuant to this
  346  subparagraph, notwithstanding any sale or other disposition of
  347  the property that is the subject of the adjustments and
  348  regardless of whether such property remains in service in the
  349  hands of the taxpayer.
  350         3. There shall be added to such taxable income an amount
  351  equal to the amount of deferred income not included in such
  352  taxable income pursuant to s. 108(i)(1) of the Internal Revenue
  353  Code of 1986, as amended by s. 1231 of Pub. L. No. 111-5. There
  354  shall be subtracted from such taxable income an amount equal to
  355  the amount of deferred income included in such taxable income
  356  pursuant to s. 108(i)(1) of the Internal Revenue Code of 1986,
  357  as amended by s. 1231 of Pub. L. No. 111-5.
  358         4. Subtractions available under this paragraph may be
  359  transferred to the surviving or acquiring entity following a
  360  merger or acquisition and used in the same manner and with the
  361  same limitations as specified by this paragraph.
  362         5. The additions and subtractions specified in this
  363  paragraph are intended to adjust taxable income for Florida tax
  364  purposes, and, notwithstanding any other provision of this code,
  365  such additions and subtractions shall be permitted to change a
  366  taxpayer’s net operating loss for Florida tax purposes.
  367         (2) For purposes of this section, a taxpayer’s taxable
  368  income for the taxable year means taxable income as defined in
  369  s. 63 of the Internal Revenue Code and properly reportable for
  370  federal income tax purposes for the taxable year, but subject to
  371  the limitations set forth in paragraph (1)(b) with respect to
  372  the deductions provided by ss. 172 (relating to net operating
  373  losses), 170(d)(2) (relating to excess charitable
  374  contributions), 404(a)(1)(D) (relating to excess pension trust
  375  contributions), 404(a)(3)(A) and (B) (to the extent relating to
  376  excess stock bonus and profit-sharing trust contributions), and
  377  1212 (relating to capital losses) of the Internal Revenue Code,
  378  except that, subject to the same limitations, the term:
  379         (a) “Taxable income,” in the case of a life insurance
  380  company subject to the tax imposed by s. 801 of the Internal
  381  Revenue Code, means life insurance company taxable income;
  382  however, for purposes of this code, the total of any amounts
  383  subject to tax under s. 815(a)(2) of the Internal Revenue Code
  384  pursuant to s. 801(c) of the Internal Revenue Code shall not
  385  exceed, cumulatively, the total of any amounts determined under
  386  s. 815(c)(2) of the Internal Revenue Code of 1954, as amended,
  387  from January 1, 1972, to December 31, 1983;
  388         (b) “Taxable income,” in the case of an insurance company
  389  subject to the tax imposed by s. 831(b) of the Internal Revenue
  390  Code, means taxable investment income;
  391         (c) “Taxable income,” in the case of an insurance company
  392  subject to the tax imposed by s. 831(a) of the Internal Revenue
  393  Code, means insurance company taxable income;
  394         (d) “Taxable income,” in the case of a regulated investment
  395  company subject to the tax imposed by s. 852 of the Internal
  396  Revenue Code, means investment company taxable income;
  397         (e) “Taxable income,” in the case of a real estate
  398  investment trust subject to the tax imposed by s. 857 of the
  399  Internal Revenue Code, means the income subject to tax, computed
  400  as provided in s. 857 of the Internal Revenue Code;
  401         (f) “Taxable income,” in the case of a corporation which is
  402  a member of an affiliated group of corporations filing a
  403  consolidated income tax return for the taxable year for federal
  404  income tax purposes, means taxable income of such corporation
  405  for federal income tax purposes as if such corporation had filed
  406  a separate federal income tax return for the taxable year and
  407  each preceding taxable year for which it was a member of an
  408  affiliated group, unless a consolidated return for the taxpayer
  409  and others is required or elected under s. 220.131;
  410         (g) “Taxable income,” in the case of a cooperative
  411  corporation or association, means the taxable income of such
  412  organization determined in accordance with the provisions of ss.
  413  1381-1388 of the Internal Revenue Code;
  414         (h) “Taxable income,” in the case of an organization which
  415  is exempt from the federal income tax by reason of s. 501(a) of
  416  the Internal Revenue Code, means its unrelated business taxable
  417  income as determined under s. 512 of the Internal Revenue Code;
  418         (i) “Taxable income,” in the case of a corporation for
  419  which there is in effect for the taxable year an election under
  420  s. 1362(a) of the Internal Revenue Code, means the amounts
  421  subject to tax under s. 1374 or s. 1375 of the Internal Revenue
  422  Code for each taxable year;
  423         (j) “Taxable income,” in the case of a limited liability
  424  company, other than a limited liability company classified as a
  425  partnership for federal income tax purposes, as defined in and
  426  organized pursuant to chapter 605 or qualified to do business in
  427  this state as a foreign limited liability company or other than
  428  a similar limited liability company classified as a partnership
  429  for federal income tax purposes and created as an artificial
  430  entity pursuant to the statutes of the United States or any
  431  other state, territory, possession, or jurisdiction, if such
  432  limited liability company or similar entity is taxable as a
  433  corporation for federal income tax purposes, means taxable
  434  income determined as if such limited liability company were
  435  required to file or had filed a federal corporate income tax
  436  return under the Internal Revenue Code;
  437         (k) “Taxable income,” in the case of a taxpayer liable for
  438  the alternative minimum tax as defined in s. 55 of the Internal
  439  Revenue Code, means the alternative minimum taxable income as
  440  defined in s. 55(b)(2) of the Internal Revenue Code, less the
  441  exemption amount computed under s. 55(d) of the Internal Revenue
  442  Code. A taxpayer is not liable for the alternative minimum tax
  443  unless the taxpayer’s federal tax return, or related federal
  444  consolidated tax return, if included in a consolidated return
  445  for federal tax purposes, reflect a liability on the return
  446  filed for the alternative minimum tax as defined in s. 55(b)(2)
  447  of the Internal Revenue Code;
  448         (l) “Taxable income,” in the case of a taxpayer whose
  449  taxable income is not otherwise defined in this subsection,
  450  means the sum of amounts to which a tax rate specified in s. 11
  451  of the Internal Revenue Code plus the amount to which a tax rate
  452  specified in s. 1201(a)(2) of the Internal Revenue Code are
  453  applied for federal income tax purposes.
  454         Section 3. Section 220.131, Florida Statutes, is repealed.
  455         Section 4. Section 220.136, Florida Statutes, is created to
  456  read:
  457         220.136 Determination of the members of a water’s edge
  458  group.—
  459         (1)A corporation having 50 percent or more of its
  460  outstanding voting stock directly or indirectly owned or
  461  controlled by a water’s edge group is presumed to be a member of
  462  the water’s edge group. A corporation having less than 50
  463  percent of its outstanding voting stock directly or indirectly
  464  owned or controlled by a water’s edge group is a member of the
  465  water’s edge group if the business activities of the corporation
  466  show that the corporation is a member of the water’s edge group.
  467  All of the income of a corporation that is a member of a water’s
  468  edge group is presumed to be unitary. For purposes of this
  469  subsection, the attribution rules of 26 U.S.C. s. 318 must be
  470  used to determine whether voting stock is indirectly owned.
  471         (2)(a)A corporation that conducts business outside the
  472  United States is not a member of a water’s edge group if 80
  473  percent or more of the corporation’s property and payroll, as
  474  determined by the apportionment factors described in ss. 220.15
  475  and 220.1363, may be assigned to locations outside of the United
  476  States. However, such a corporation that is incorporated in a
  477  tax haven may be a member of a water’s edge group pursuant to
  478  subsection (1). This subsection does not exempt a corporation
  479  that is not a member of a water’s edge group from this chapter.
  480         (b) As used in this subsection, the term “United States”
  481  means the 50 states, the District of Columbia, and Puerto Rico.
  482         (c)The apportionment factors described in ss. 220.1363 and
  483  220.15 must be used to determine whether a special industry
  484  corporation has engaged in a sufficient amount of activities
  485  outside of the United States to exclude it from treatment as a
  486  member of a water’s edge group.
  487         Section 5. Section 220.1363, Florida Statutes, is created
  488  to read:
  489         220.1363 Water’s edge groups; special requirements.—
  490         (1) For purposes of this section, the term “water’s edge
  491  reporting method” is a method to determine the taxable business
  492  profits of a group of entities conducting a unitary business.
  493  Under this method, the net income of the entities must be added
  494  together, along with the additions and subtractions under s.
  495  220.13, and apportioned to this state as a single taxpayer under
  496  ss. 220.15 and 220.151. However, each special industry member
  497  included in a water’s edge group return which would otherwise be
  498  permitted to use a special method of apportionment under s.
  499  220.151 shall convert its single-factor apportionment to a
  500  three-factor apportionment of property, payroll, and sales. The
  501  special industry member shall calculate the denominator of its
  502  property, payroll, and sales factors in the same manner as those
  503  denominators are calculated by members that are not special
  504  industry members. The numerator of its sales, property, and
  505  payroll factors is the product of the denominator of each factor
  506  multiplied by the premiums or revenue-miles-factor ratio
  507  otherwise applicable under s. 220.151.
  508         (2)All members of a water’s edge group must use the
  509  water’s edge reporting method, under which:
  510         (a)Adjusted federal income, for purposes of s. 220.12,
  511  means the sum of adjusted federal income of all members of the
  512  water’s edge group as determined for a concurrent taxable year.
  513         (b)The numerators and denominators of the apportionment
  514  factors must be calculated for all members of the water’s edge
  515  group combined.
  516         (c)Intercompany sales transactions between members of the
  517  water’s edge group are not included in the numerator or
  518  denominator of the sales factor under ss. 220.15 and 220.151,
  519  regardless of whether indicia of a sale exist.
  520         (d)For sales of intangibles, including, but not limited
  521  to, accounts receivable, notes, bonds, and stock, which are made
  522  to entities outside the group, only the net proceeds are
  523  included in the numerator and denominator of the sales factor.
  524         (e)Sales that are not allocated or apportioned to any
  525  taxing jurisdiction, otherwise known as “nowhere sales,” may not
  526  be included in the numerator or denominator of the sales factor.
  527         (f)The income attributable to the Florida activities of a
  528  corporation that is exempt from taxation under the Interstate
  529  Income Act of 1959, Pub. L. No. 86-272, is excluded from the
  530  apportionment factor numerators in the calculation of corporate
  531  income tax, even if another member of the water’s edge group has
  532  nexus with this state and is subject to tax.
  533  
  534  As used in this subsection, the term “sale” includes, but is not
  535  limited to, loans, payments for the use of intangibles,
  536  dividends, and management fees.
  537         (3)(a)If a parent corporation is a member of the water’s
  538  edge group and has nexus with this state, a single water’s edge
  539  group return must be filed in the name and under the federal
  540  employer identification number of the parent corporation. If the
  541  water’s edge group does not have a parent corporation, if the
  542  parent corporation is not a member of the water’s edge group, or
  543  if the parent corporation does not have nexus with this state,
  544  then the members of the water’s edge group must choose a member
  545  subject to the tax imposed by this chapter to file the return.
  546  The members of the water’s edge group may not choose another
  547  member to file a corporate income tax return in subsequent years
  548  unless the filing member does not maintain nexus with this state
  549  or does not remain a member of the water’s edge group. The
  550  return must be signed by an authorized officer of the filing
  551  member as the agent for the water’s edge group.
  552         (b)If members of a water’s edge group have different
  553  taxable years, the taxable year of a majority of the members of
  554  the water’s edge group is the taxable year of the water’s edge
  555  group. If the taxable years of a majority of the members of a
  556  water’s edge group do not correspond, the taxable year of the
  557  member that must file the return for the water’s edge group is
  558  the taxable year of the water’s edge group.
  559         (c)1.A member of a water’s edge group having a taxable
  560  year that does not correspond to the taxable year of the water’s
  561  edge group shall determine its income for inclusion on the tax
  562  return for the water’s edge group. The member shall use:
  563         a.The precise amount of taxable income received during the
  564  months corresponding to the taxable year of the water’s edge
  565  group if the precise amount can be readily determined from the
  566  member’s books and records.
  567         b.The taxable income of the member converted to conform to
  568  the taxable year of the water’s edge group on the basis of the
  569  number of months falling within the taxable year of the water’s
  570  edge group. For example, if the taxable year of the water’s edge
  571  group is a calendar year and a member operates on a fiscal year
  572  ending on April 30, the income of the member must include 8/12
  573  of the income from the current taxable year and 4/12 of the
  574  income from the preceding taxable year. This method to determine
  575  the income of a member may be used only if the return can be
  576  timely filed after the end of the taxable year of the water’s
  577  edge group.
  578         c.The taxable income of the member during its taxable year
  579  that ends within the taxable year of the water’s edge group.
  580         2.The method of determining the income of a member of a
  581  water’s edge group whose taxable year does not correspond to the
  582  taxable year of the water’s edge group may not change as long as
  583  the member remains a member of the water’s edge group. The
  584  apportionment factors for the member must be applied to the
  585  income of the member for the taxable year of the water’s edge
  586  group.
  587         (4)(a)A water’s edge group return must include a
  588  computational schedule that:
  589         1.Combines the federal income of all members of the
  590  water’s edge group;
  591         2.Shows all intercompany eliminations;
  592         3.Shows Florida additions and subtractions under s.
  593  220.13; and
  594         4.Shows the calculation of the combined apportionment
  595  factors.
  596         (b)In addition to its return, a water’s edge group shall
  597  also file a domestic disclosure spreadsheet. The spreadsheet
  598  must fully disclose:
  599         1.The income reported to each state;
  600         2.The state tax liability;
  601         3.The method used for apportioning or allocating income to
  602  the various states; and
  603         4.Other information required by department rule in order
  604  to determine the proper amount of tax due to each state and to
  605  identify the water’s edge group.
  606         (5)The department may adopt rules and forms to administer
  607  this section. The Legislature intends to grant the department
  608  extensive authority to adopt rules and forms describing and
  609  defining principles for determining the existence of a water’s
  610  edge business, definitions of common control, methods of
  611  reporting, and related forms, principles, and other definitions.
  612         Section 6. Section 220.14, Florida Statutes, is amended to
  613  read:
  614         220.14 Exemption.—
  615         (1) In computing a taxpayer’s liability for tax under this
  616  code, there shall be exempt from the tax $50,000 of net income
  617  as defined in s. 220.12 or such lesser amount as will, without
  618  increasing the taxpayer’s federal income tax liability, provide
  619  the state with an amount under this code which is equal to the
  620  maximum federal income tax credit which may be available from
  621  time to time under federal law.
  622         (2) In the case of a taxable year for a period of less than
  623  12 months, the exemption allowed by this section must shall be
  624  prorated on the basis of the number of days in such year to 365
  625  days or, in a leap year, 366 days.
  626         (3) Only one exemption shall be allowed to taxpayers filing
  627  a water’s edge group consolidated return under this code.
  628         (4) Notwithstanding any other provision of this code, not
  629  more than one exemption under this section may be allowed to the
  630  Florida members of a controlled group of corporations, as
  631  defined in s. 1563 of the Internal Revenue Code with respect to
  632  taxable years ending on or after December 31, 1970, filing
  633  separate returns under this code. The exemption described in
  634  this section shall be divided equally among such Florida members
  635  of the group, unless all of such members consent, at such time
  636  and in such manner as the department shall by regulation
  637  prescribe, to an apportionment plan providing for an unequal
  638  allocation of such exemption.
  639         Section 7. Paragraph (c) of subsection (5) of section
  640  220.15, Florida Statutes, is amended to read:
  641         220.15 Apportionment of adjusted federal income.—
  642         (5) The sales factor is a fraction the numerator of which
  643  is the total sales of the taxpayer in this state during the
  644  taxable year or period and the denominator of which is the total
  645  sales of the taxpayer everywhere during the taxable year or
  646  period.
  647         (c) Sales of a financial organization, including, but not
  648  limited to, banking and savings institutions, investment
  649  companies, real estate investment trusts, and brokerage
  650  companies, occur in this state if derived from:
  651         1. Fees, commissions, or other compensation for financial
  652  services rendered within this state;
  653         2. Gross profits from trading in stocks, bonds, or other
  654  securities managed within this state;
  655         3. Interest received within this state, other than interest
  656  from loans secured by mortgages, deeds of trust, or other liens
  657  upon real or tangible personal property located without this
  658  state, and dividends received within this state;
  659         4. Interest charged to customers at places of business
  660  maintained within this state for carrying debit balances of
  661  margin accounts, without deduction of any costs incurred in
  662  carrying such accounts;
  663         5. Interest, fees, commissions, or other charges or gains
  664  from loans secured by mortgages, deeds of trust, or other liens
  665  upon real or tangible personal property located in this state or
  666  from installment sale agreements originally executed by a
  667  taxpayer or the taxpayer’s agent to sell real or tangible
  668  personal property located in this state;
  669         6. Rents from real or tangible personal property located in
  670  this state; or
  671         7. Any other gross income, including other interest,
  672  resulting from the operation as a financial organization within
  673  this state.
  674  
  675  In computing the amounts under this paragraph, any amount
  676  received by a member of an affiliated group (determined under s.
  677  1504(a) of the Internal Revenue Code, but without reference to
  678  whether any such corporation is an “includable corporation”
  679  under s. 1504(b) of the Internal Revenue Code) from another
  680  member of such group shall be included only to the extent such
  681  amount exceeds expenses of the recipient directly related
  682  thereto.
  683         Section 8. Paragraph (f) of subsection (1) of section
  684  220.183, Florida Statutes, is amended to read:
  685         220.183 Community contribution tax credit.—
  686         (1) AUTHORIZATION TO GRANT COMMUNITY CONTRIBUTION TAX
  687  CREDITS; LIMITATIONS ON INDIVIDUAL CREDITS AND PROGRAM
  688  SPENDING.—
  689         (f) A taxpayer who files a Florida consolidated return as a
  690  member of an affiliated group pursuant to s. 220.131(1) may be
  691  allowed the credit on a consolidated return basis.
  692         Section 9. Paragraphs (b), (c), and (d) of subsection (2)
  693  of section 220.1845, Florida Statutes, are amended to read:
  694         220.1845 Contaminated site rehabilitation tax credit.—
  695         (2) AUTHORIZATION FOR TAX CREDIT; LIMITATIONS.—
  696         (b) A tax credit applicant, or multiple tax credit
  697  applicants working jointly to clean up a single site, may not be
  698  granted more than $500,000 per year in tax credits for each site
  699  voluntarily rehabilitated. Multiple tax credit applicants shall
  700  be granted tax credits in the same proportion as their
  701  contribution to payment of cleanup costs. Subject to the same
  702  conditions and limitations as provided in this section, a
  703  municipality, county, or other tax credit applicant which
  704  voluntarily rehabilitates a site may receive not more than
  705  $500,000 per year in tax credits which it can subsequently
  706  transfer subject to the provisions in paragraph (f) (g).
  707         (c) If the credit granted under this section is not fully
  708  used in any one year because of insufficient tax liability on
  709  the part of the corporation, the unused amount may be carried
  710  forward for up to 5 years. The carryover credit may be used in a
  711  subsequent year if the tax imposed by this chapter for that year
  712  exceeds the credit for which the corporation is eligible in that
  713  year after applying the other credits and unused carryovers in
  714  the order provided by s. 220.02(8). If during the 5-year period
  715  the credit is transferred, in whole or in part, pursuant to
  716  paragraph (f) (g), each transferee has 5 years after the date of
  717  transfer to use its credit.
  718         (d) A taxpayer that files a consolidated return in this
  719  state as a member of an affiliated group under s. 220.131(1) may
  720  be allowed the credit on a consolidated return basis up to the
  721  amount of tax imposed upon the consolidated group.
  722         Section 10. Subsection (2) of section 220.1875, Florida
  723  Statutes, is amended to read:
  724         220.1875 Credit for contributions to eligible nonprofit
  725  scholarship-funding organizations.—
  726         (2) A taxpayer who files a Florida consolidated return as a
  727  member of an affiliated group pursuant to s. 220.131(1) may be
  728  allowed the credit on a consolidated return basis; however, the
  729  total credit taken by the affiliated group is subject to the
  730  limitation established under subsection (1).
  731         Section 11. Paragraphs (a) and (c) of subsection (3) of
  732  section 220.191, Florida Statutes, are amended to read:
  733         220.191 Capital investment tax credit.—
  734         (3)(a) Notwithstanding subsection (2), an annual credit
  735  against the tax imposed by this chapter shall be granted to a
  736  qualifying business which establishes a qualifying project
  737  pursuant to subparagraph (1)(g)3., in an amount equal to the
  738  lesser of $15 million or 5 percent of the eligible capital costs
  739  made in connection with a qualifying project, for a period not
  740  to exceed 20 years beginning with the commencement of operations
  741  of the project. The tax credit shall be granted against the
  742  corporate income tax liability of the qualifying business and as
  743  further provided in paragraph (c). The total tax credit provided
  744  pursuant to this subsection shall be equal to no more than 100
  745  percent of the eligible capital costs of the qualifying project.
  746         (c) The credit granted under this subsection may be used in
  747  whole or in part by the qualifying business or any corporation
  748  that is either a member of that qualifying business’s affiliated
  749  group of corporations, is a related entity taxable as a
  750  cooperative under subchapter T of the Internal Revenue Code, or,
  751  if the qualifying business is an entity taxable as a cooperative
  752  under subchapter T of the Internal Revenue Code, is related to
  753  the qualifying business. Any entity related to the qualifying
  754  business may continue to file as a member of a Florida-nexus
  755  consolidated group pursuant to a prior election made under s.
  756  220.131(1), Florida Statutes (1985), even if the parent of the
  757  group changes due to a direct or indirect acquisition of the
  758  former common parent of the group. Any credit can be used by any
  759  of the affiliated companies or related entities referenced in
  760  this paragraph to the same extent as it could have been used by
  761  the qualifying business. However, any such use shall not operate
  762  to increase the amount of the credit or extend the period within
  763  which the credit must be used.
  764         Section 12. Paragraphs (c) and (e) of subsection (3) of
  765  section 220.193, Florida Statutes, are amended to read:
  766         220.193 Florida renewable energy production credit.—
  767         (3) An annual credit against the tax imposed by this
  768  section shall be allowed to a taxpayer, based on the taxpayer’s
  769  production and sale of electricity from a new or expanded
  770  Florida renewable energy facility. For a new facility, the
  771  credit shall be based on the taxpayer’s sale of the facility’s
  772  entire electrical production. For an expanded facility, the
  773  credit shall be based on the increases in the facility’s
  774  electrical production that are achieved after May 1, 2012.
  775         (c) If the amount of credits applied for each year exceeds
  776  the amount authorized in paragraph (f) (g), the Department of
  777  Agriculture and Consumer Services shall allocate credits to
  778  qualified applicants based on the following priority:
  779         1. An applicant who places a new facility in operation
  780  after May 1, 2012, shall be allocated credits first, up to a
  781  maximum of $250,000 each, with any remaining credits to be
  782  granted pursuant to subparagraph 3., but if the claims for
  783  credits under this subparagraph exceed the state fiscal year cap
  784  in paragraph (f) (g), credits shall be allocated pursuant to
  785  this subparagraph on a prorated basis based upon each
  786  applicant’s qualified production and sales as a percentage of
  787  total production and sales for all applicants in this category
  788  for the fiscal year.
  789         2. An applicant who does not qualify under subparagraph 1.
  790  but who claims a credit of $50,000 or less shall be allocated
  791  credits next, but if the claims for credits under this
  792  subparagraph, combined with credits allocated in subparagraph
  793  1., exceed the state fiscal year cap in paragraph (f) (g),
  794  credits shall be allocated pursuant to this subparagraph on a
  795  prorated basis based upon each applicant’s qualified production
  796  and sales as a percentage of total qualified production and
  797  sales for all applicants in this category for the fiscal year.
  798         3. An applicant who does not qualify under subparagraph 1.
  799  or subparagraph 2. and an applicant whose credits have not been
  800  fully allocated under subparagraph 1. shall be allocated credits
  801  next. If there is insufficient capacity within the amount
  802  authorized for the state fiscal year in paragraph (f) (g), and
  803  after allocations pursuant to subparagraphs 1. and 2., the
  804  credits allocated under this subparagraph shall be prorated
  805  based upon each applicant’s unallocated claims for qualified
  806  production and sales as a percentage of total unallocated claims
  807  for qualified production and sales of all applicants in this
  808  category, up to a maximum of $1 million per taxpayer per state
  809  fiscal year. If, after application of this $1 million cap, there
  810  is excess capacity under the state fiscal year cap in paragraph
  811  (f) (g) in any state fiscal year, that remaining capacity shall
  812  be used to allocate additional credits with priority given in
  813  the order set forth in this subparagraph and without regard to
  814  the $1 million per taxpayer cap.
  815         (e) A taxpayer that files a consolidated return in this
  816  state as a member of an affiliated group under s. 220.131(1) may
  817  be allowed the credit on a consolidated return basis up to the
  818  amount of tax imposed upon the consolidated group.
  819         Section 13. Paragraph (a) of subsection (1) of section
  820  220.27, Florida Statutes, is amended to read:
  821         220.27 Additional required information.—
  822         (1)(a) Every taxpayer that is required to file a return
  823  under s. 220.22(1) for a taxable year beginning during the 2018
  824  or 2019 calendar years, must submit to the department the
  825  following information for those taxable years using the
  826  application form on the department’s website:
  827         1. The taxpayer’s name, federal taxpayer identification
  828  number, taxable year beginning date, taxable year ending date,
  829  and, for taxable years beginning before January 1, 2021, only,
  830  whether a consolidated return for the taxpayer is required or
  831  elected under s. 220.131.
  832         2. The taxpayer’s NAICS code for business activity that
  833  generates the greatest proportion of gross receipts of the
  834  taxpayer. As used in this paragraph, the term “NAICS” means
  835  those classifications contained in the North American Industry
  836  Classification System, as published in 2007 by the Office of
  837  Management and Budget, Executive Office of the President.
  838         3. The taxpayer’s taxable income as that term is defined in
  839  s. 220.13(2) and the taxpayer’s state apportionment fraction
  840  pursuant to s. 220.15 for the taxable year.
  841         4. The amount of global intangible low-taxed income
  842  included in federal taxable income under s. 951A of the Internal
  843  Revenue Code, and the amount of the related deduction under s.
  844  250 of the Internal Revenue Code, as it pertains to s. 951A of
  845  the Internal Revenue Code.
  846         5. The amount of foreign-derived intangible income computed
  847  for the federal return for the taxable year and the amount of
  848  the related deduction under s. 250 of the Internal Revenue Code,
  849  as it pertains to foreign-derived intangible income.
  850         6. The amount of business interest expense deducted on the
  851  federal return under s. 163 of the Internal Revenue Code,
  852  including any carryover; the amount of current year business
  853  interest expense, including any carryover, which that was not
  854  deducted due to the limitation in s. 163(j) of the Internal
  855  Revenue Code; and the amount of business interest expense
  856  carried over from previous taxable years.
  857         7. The amount of federal net operating loss deduction under
  858  s. 172 of the Internal Revenue Code, applied in determining
  859  federal taxable income and the amount of federal net operating
  860  loss carryover that was not applied due to the limitation in s.
  861  172(a)(2) of the Internal Revenue Code.
  862         8. The total amount of state net operating loss carryover
  863  available after the filing of the return for the taxable year.
  864         9. The total amount of the state alternative minimum tax
  865  credit carryover available after the filing of the return for
  866  the taxable year.
  867         Section 14. Section 220.28, Florida Statutes, is created to
  868  read:
  869         220.28 Water’s edge group transitional rules.—
  870         (1)For the first taxable year beginning on or after
  871  January 1, 2021, a taxpayer that filed a Florida corporate
  872  income tax return in the preceding taxable year and that is a
  873  member of a water’s edge group shall compute its income together
  874  with all members of its water’s edge group and file a combined
  875  Florida corporate income tax return with all members of its
  876  water’s edge group.
  877         (2)An affiliated group of corporations which filed a
  878  Florida consolidated corporate income tax return pursuant to an
  879  election provided in former s. 220.131 shall cease filing a
  880  Florida consolidated return for taxable years beginning on or
  881  after January 1, 2021, and shall file a combined Florida
  882  corporate income tax return with all members of its water’s edge
  883  group.
  884         (3)An affiliated group of corporations which filed a
  885  Florida consolidated corporate income tax return pursuant to the
  886  election in former s. 220.131(1) (1985), which allowed the
  887  affiliated group to make an election within 90 days after
  888  December 20, 1984, or upon filing the taxpayer’s first return
  889  after December 20, 1984, whichever was later, shall cease filing
  890  a Florida consolidated corporate income tax return using that
  891  method for taxable years beginning on or after January 1, 2021,
  892  and shall file a combined Florida corporate income tax return
  893  with all members of its water’s edge group.
  894         (4)A taxpayer that is not a member of a water’s edge group
  895  remains subject to this chapter and shall file a separate
  896  Florida corporate income tax return as previously required.
  897         (5)For taxable years beginning on or after January 1,
  898  2021, a tax return for a member of a water’s edge group must be
  899  a combined Florida corporate income tax return that includes tax
  900  information for all members of the water’s edge group. The tax
  901  return must be filed by a member that has a nexus with this
  902  state.
  903         Section 15. Section 220.51, Florida Statutes, is amended to
  904  read:
  905         220.51 Adoption Promulgation of rules and regulations.—In
  906  accordance with the Administrative Procedure Act, chapter 120,
  907  the department is authorized to make, adopt promulgate, and
  908  enforce such reasonable rules and regulations, and to prescribe
  909  such forms relating to the administration and enforcement of the
  910  provisions of this code, as it may deem appropriate, including:
  911         (1) Rules for initial implementation of this code and for
  912  taxpayers’ transitional taxable years commencing before and
  913  ending after January 1, 1972; and
  914         (2) Rules or regulations to clarify whether certain groups,
  915  organizations, or associations formed under the laws of this
  916  state or any other state, country, or jurisdiction shall be
  917  deemed “taxpayers” for the purposes of this code, in accordance
  918  with the legislative declarations of intent in s. 220.02; and
  919         (3) Regulations relating to consolidated reporting for
  920  affiliated groups of corporations, in order to provide for an
  921  equitable and just administration of this code with respect to
  922  multicorporate taxpayers.
  923         Section 16. Section 220.64, Florida Statutes, is amended to
  924  read:
  925         220.64 Other provisions applicable to franchise tax.—To the
  926  extent that they are not manifestly incompatible with the
  927  provisions of this part, parts I, III, IV, V, VI, VIII, IX, and
  928  X of this code and ss. 220.12, 220.13, 220.136, 220.1363,
  929  220.15, and 220.16 apply to the franchise tax imposed by this
  930  part. Under rules prescribed by the department in s. 220.131, a
  931  consolidated return may be filed by any affiliated group of
  932  corporations consisting composed of one or more banks or savings
  933  associations, its or their Florida parent corporations
  934  corporation, and any nonbank or nonsavings subsidiaries of such
  935  parent corporations corporation.
  936         Section 17. Paragraph (f) of subsection (4) and paragraph
  937  (a) of subsection (5) of section 288.1254, Florida Statutes, are
  938  amended to read:
  939         288.1254 Entertainment industry financial incentive
  940  program.—
  941         (4) TAX CREDIT ELIGIBILITY; TAX CREDIT AWARDS; QUEUES;
  942  ELECTION AND DISTRIBUTION; CARRYFORWARD; CONSOLIDATED RETURNS;
  943  PARTNERSHIP AND NONCORPORATE DISTRIBUTIONS; MERGERS AND
  944  ACQUISITIONS.—
  945         (f) Consolidated returns.—A certified production company
  946  that files a Florida consolidated return as a member of an
  947  affiliated group under s. 220.131(1) may be allowed the credit
  948  on a consolidated return basis up to the amount of the tax
  949  imposed upon the consolidated group under chapter 220.
  950         (5) TRANSFER OF TAX CREDITS.—
  951         (a) Authorization.—Upon application to the Office of Film
  952  and Entertainment and approval by the department, a certified
  953  production company, or a partner or member that has received a
  954  distribution under paragraph (4)(f) (4)(g), may elect to
  955  transfer, in whole or in part, any unused credit amount granted
  956  under this section. An election to transfer any unused tax
  957  credit amount under chapter 212 or chapter 220 must be made no
  958  later than 5 years after the date the credit is awarded, after
  959  which period the credit expires and may not be used. The
  960  department shall notify the Department of Revenue of the
  961  election and transfer.
  962         Section 18. Subsections (9) and (10) of section 376.30781,
  963  Florida Statutes, are amended to read:
  964         376.30781 Tax credits for rehabilitation of drycleaning
  965  solvent-contaminated sites and brownfield sites in designated
  966  brownfield areas; application process; rulemaking authority;
  967  revocation authority.—
  968         (9) On or before May 1, the Department of Environmental
  969  Protection shall inform each tax credit applicant that is
  970  subject to the January 31 annual application deadline of the
  971  applicant’s eligibility status and the amount of any tax credit
  972  due. The department shall provide each eligible tax credit
  973  applicant with a tax credit certificate that must be submitted
  974  with its tax return to the Department of Revenue to claim the
  975  tax credit or be transferred pursuant to s. 220.1845(2)(f) s.
  976  220.1845(2)(g). The May 1 deadline for annual site
  977  rehabilitation tax credit certificate awards shall not apply to
  978  any tax credit application for which the department has issued a
  979  notice of deficiency pursuant to subsection (8). The department
  980  shall respond within 90 days after receiving a response from the
  981  tax credit applicant to such a notice of deficiency. Credits may
  982  not result in the payment of refunds if total credits exceed the
  983  amount of tax owed.
  984         (10) For solid waste removal, new health care facility or
  985  health care provider, and affordable housing tax credit
  986  applications, the Department of Environmental Protection shall
  987  inform the applicant of the department’s determination within 90
  988  days after the application is deemed complete. Each eligible tax
  989  credit applicant shall be informed of the amount of its tax
  990  credit and provided with a tax credit certificate that must be
  991  submitted with its tax return to the Department of Revenue to
  992  claim the tax credit or be transferred pursuant to s.
  993  220.1845(2)(f) s. 220.1845(2)(g). Credits may not result in the
  994  payment of refunds if total credits exceed the amount of tax
  995  owed.
  996         Section 19. Funds recaptured pursuant to this act must be
  997  appropriated in the General Appropriations Act to the various
  998  school districts to reduce the required local effort millage.
  999         Section 20. This act shall take effect July 1, 2020.