Florida Senate - 2023                                    SB 1144
       
       
        
       By Senator Thompson
       
       
       
       
       
       15-01053B-23                                          20231144__
    1                        A bill to be entitled                      
    2         An act relating to corporate income tax; amending s.
    3         220.03, F.S.; revising and providing definitions;
    4         amending s. 220.13, F.S.; revising the definition of
    5         the term “adjusted federal income” to prohibit
    6         specified deductions, limit certain carryovers, and
    7         require subtractions of certain dividends paid and
    8         received within a unitary combined group to determine
    9         subtractions from taxable income; conforming
   10         provisions to changes made by the act; repealing s.
   11         220.131, F.S., relating to the adjusted federal income
   12         of affiliated groups; creating s. 220.136, F.S.;
   13         specifying circumstances under which a corporation is
   14         a member of a unitary combined group; creating s.
   15         220.1363, F.S.; defining the term “unitary combined
   16         reporting method”; specifying requirements for,
   17         limitations on, and prohibitions in calculating and
   18         reporting income in a unitary combined group return;
   19         requiring all members of a unitary combined group to
   20         use the unitary combined reporting method; defining
   21         the term “sale”; specifying requirements for
   22         designating the filing member and the taxable year of
   23         the unitary combined group; specifying income
   24         reporting requirements for certain members of the
   25         unitary combined group; requiring that a unitary
   26         combined group return include a specified
   27         computational schedule and domestic disclosure
   28         spreadsheet; authorizing the executive director of the
   29         Department of Revenue to undertake certain actions in
   30         specified circumstances; authorizing the Department of
   31         Revenue to adopt rules; providing legislative intent
   32         regarding the adoption of rules; amending s. 220.14,
   33         F.S.; revising the calculation for prorating a certain
   34         corporate income tax exemption to reflect leap years;
   35         conforming a provision to changes made by the act;
   36         amending s. 220.15, F.S.; revising provisions
   37         determining when certain sales are considered to have
   38         occurred in this state; amending ss. 220.183,
   39         220.1845, 220.1875, 220.1876, 220.1877, 220.191,
   40         220.193, and 220.51, F.S.; conforming provisions to
   41         changes made by the act; amending s. 220.64, F.S.;
   42         providing applicability of unitary combined group
   43         provisions to the franchise tax; conforming provisions
   44         to changes made by the act; amending ss. 288.1254 and
   45         376.30781, F.S.; conforming provisions to changes made
   46         by the act; providing, beginning on a specified date,
   47         requirements for corporate income tax return filings
   48         for certain taxpayers; requiring that recaptured funds
   49         be deposited into the General Revenue Fund; providing
   50         an effective date.
   51          
   52  Be It Enacted by the Legislature of the State of Florida:
   53  
   54         Section 1. Paragraph (z) of subsection (1) of section
   55  220.03, Florida Statutes, is amended, and paragraph (gg) is
   56  added to that subsection, to read:
   57         220.03 Definitions.—
   58         (1) SPECIFIC TERMS.—When used in this code, and when not
   59  otherwise distinctly expressed or manifestly incompatible with
   60  the intent thereof, the following terms shall have the following
   61  meanings:
   62         (z) “Taxpayer” means any corporation subject to the tax
   63  imposed by this code, and includes all corporations that are
   64  members of a unitary combined group for which a consolidated
   65  return is filed under s. 220.131. However, the term “taxpayer”
   66  does not include a corporation having no individuals, (including
   67  individuals employed by an affiliate,) receiving compensation in
   68  this state as defined in s. 220.15 when the only property owned
   69  or leased by the said corporation, (including an affiliate,) in
   70  this state is located at the premises of a printer with which it
   71  has contracted for printing, if such property consists of the
   72  final printed product, property which becomes a part of the
   73  final printed product, or property from which the printed
   74  product is produced.
   75         (gg)“Unitary combined group” means a group of corporations
   76  related through common ownership whose business activities are
   77  integrated with, dependent upon, or contribute to a flow of
   78  value among members of the group.
   79         Section 2. Subsection (1) and paragraph (f) of subsection
   80  (2) of section 220.13, Florida Statutes, are amended to read:
   81         220.13 “Adjusted federal income” defined.—
   82         (1) The term “adjusted federal income” means an amount
   83  equal to the taxpayer’s taxable income as defined in subsection
   84  (2), or such taxable income of a unitary combined group more
   85  than one taxpayer as provided in s. 220.1363 s. 220.131, for the
   86  taxable year, adjusted as follows:
   87         (a) Additions.—There shall be added to such taxable income:
   88         1.a. The amount of any tax upon or measured by income,
   89  excluding taxes based on gross receipts or revenues, paid or
   90  accrued as a liability to the District of Columbia or any state
   91  of the United States which is deductible from gross income in
   92  the computation of taxable income for the taxable year.
   93         b. Notwithstanding sub-subparagraph a., if a credit taken
   94  under s. 220.1875, s. 220.1876, or s. 220.1877 is added to
   95  taxable income in a previous taxable year under subparagraph 11.
   96  and is taken as a deduction for federal tax purposes in the
   97  current taxable year, the amount of the deduction allowed shall
   98  not be added to taxable income in the current year. The
   99  exception in this sub-subparagraph is intended to ensure that
  100  the credit under s. 220.1875, s. 220.1876, or s. 220.1877 is
  101  added in the applicable taxable year and does not result in a
  102  duplicate addition in a subsequent year.
  103         2. The amount of interest which is excluded from taxable
  104  income under s. 103(a) of the Internal Revenue Code or any other
  105  federal law, less the associated expenses disallowed in the
  106  computation of taxable income under s. 265 of the Internal
  107  Revenue Code or any other law, excluding 60 percent of any
  108  amounts included in alternative minimum taxable income, as
  109  defined in s. 55(b)(2) of the Internal Revenue Code, if the
  110  taxpayer pays tax under s. 220.11(3).
  111         3. In the case of a regulated investment company or real
  112  estate investment trust, an amount equal to the excess of the
  113  net long-term capital gain for the taxable year over the amount
  114  of the capital gain dividends attributable to the taxable year.
  115         4. That portion of the wages or salaries paid or incurred
  116  for the taxable year which is equal to the amount of the credit
  117  allowable for the taxable year under s. 220.181. This
  118  subparagraph shall expire on the date specified in s. 290.016
  119  for the expiration of the Florida Enterprise Zone Act.
  120         5. That portion of the ad valorem school taxes paid or
  121  incurred for the taxable year which is equal to the amount of
  122  the credit allowable for the taxable year under s. 220.182. This
  123  subparagraph shall expire on the date specified in s. 290.016
  124  for the expiration of the Florida Enterprise Zone Act.
  125         6. The amount taken as a credit under s. 220.195 which is
  126  deductible from gross income in the computation of taxable
  127  income for the taxable year.
  128         7. That portion of assessments to fund a guaranty
  129  association incurred for the taxable year which is equal to the
  130  amount of the credit allowable for the taxable year.
  131         8. In the case of a nonprofit corporation which holds a
  132  pari-mutuel permit and which is exempt from federal income tax
  133  as a farmers’ cooperative, an amount equal to the excess of the
  134  gross income attributable to the pari-mutuel operations over the
  135  attributable expenses for the taxable year.
  136         9. The amount taken as a credit for the taxable year under
  137  s. 220.1895.
  138         10. Up to nine percent of the eligible basis of any
  139  designated project which is equal to the credit allowable for
  140  the taxable year under s. 220.185.
  141         11. Any amount taken as a credit for the taxable year under
  142  s. 220.1875, s. 220.1876, or s. 220.1877. The addition in this
  143  subparagraph is intended to ensure that the same amount is not
  144  allowed for the tax purposes of this state as both a deduction
  145  from income and a credit against the tax. This addition is not
  146  intended to result in adding the same expense back to income
  147  more than once.
  148         12. The amount taken as a credit for the taxable year under
  149  s. 220.193.
  150         13. Any portion of a qualified investment, as defined in s.
  151  288.9913, which is claimed as a deduction by the taxpayer and
  152  taken as a credit against income tax pursuant to s. 288.9916.
  153         14. The costs to acquire a tax credit pursuant to s.
  154  288.1254(5) that are deducted from or otherwise reduce federal
  155  taxable income for the taxable year.
  156         15. The amount taken as a credit for the taxable year
  157  pursuant to s. 220.194.
  158         16. The amount taken as a credit for the taxable year under
  159  s. 220.196. The addition in this subparagraph is intended to
  160  ensure that the same amount is not allowed for the tax purposes
  161  of this state as both a deduction from income and a credit
  162  against the tax. The addition is not intended to result in
  163  adding the same expense back to income more than once.
  164         17. The amount taken as a credit for the taxable year
  165  pursuant to s. 220.198.
  166         18. The amount taken as a credit for the taxable year
  167  pursuant to s. 220.1915.
  168         (b) Subtractions.—
  169         1. There shall be subtracted from such taxable income:
  170         a. The net operating loss deduction allowable for federal
  171  income tax purposes under s. 172 of the Internal Revenue Code
  172  for the taxable year, except that any net operating loss that is
  173  transferred pursuant to s. 220.194(6) may not be deducted by the
  174  seller,
  175         b. The net capital loss allowable for federal income tax
  176  purposes under s. 1212 of the Internal Revenue Code for the
  177  taxable year,
  178         c. The excess charitable contribution deduction allowable
  179  for federal income tax purposes under s. 170(d)(2) of the
  180  Internal Revenue Code for the taxable year, and
  181         d. The excess contributions deductions allowable for
  182  federal income tax purposes under s. 404 of the Internal Revenue
  183  Code for the taxable year.
  184  
  185  However, a net operating loss and a capital loss shall never be
  186  carried back as a deduction to a prior taxable year, but all
  187  deductions attributable to such losses shall be deemed net
  188  operating loss carryovers and capital loss carryovers,
  189  respectively, and treated in the same manner, to the same
  190  extent, and for the same time periods as are prescribed for such
  191  carryovers in ss. 172 and 1212, respectively, of the Internal
  192  Revenue Code. A deduction is not allowed for net operating
  193  losses, net capital losses, or excess contribution deductions
  194  under 26 U.S.C. ss. 170(d)(2), 172, 1212, and 404 for a member
  195  of a unitary combined group which is not a United States member.
  196  Carryovers of net operating losses, net capital losses, or
  197  excess contribution deductions under 26 U.S.C. ss. 170(d)(2),
  198  172, 1212, and 404 may be subtracted only by the member of the
  199  unitary combined group which generates a carryover.
  200         2. There shall be subtracted from such taxable income any
  201  amount to the extent included therein the following:
  202         a. Dividends treated as received from sources without the
  203  United States, as determined under s. 862 of the Internal
  204  Revenue Code.
  205         b. All amounts included in taxable income under s. 78, s.
  206  951, or s. 951A of the Internal Revenue Code.
  207  
  208  However, any amount subtracted under this subparagraph is
  209  allowed only to the extent such amount is not deductible in
  210  determining federal taxable income. As to any amount subtracted
  211  under this subparagraph, there shall be added to such taxable
  212  income all expenses deducted on the taxpayer’s return for the
  213  taxable year which are attributable, directly or indirectly, to
  214  such subtracted amount. Further, no amount shall be subtracted
  215  with respect to dividends paid or deemed paid by a Domestic
  216  International Sales Corporation.
  217         3.Amounts received by a member of a unitary combined group
  218  as dividends paid by another member of the unitary combined
  219  group must be subtracted from the taxable income to the extent
  220  that the dividends are included in the taxable income.
  221         4.3. In computing “adjusted federal income” for taxable
  222  years beginning after December 31, 1976, there shall be allowed
  223  as a deduction the amount of wages and salaries paid or incurred
  224  within this state for the taxable year for which no deduction is
  225  allowed pursuant to s. 280C(a) of the Internal Revenue Code
  226  (relating to credit for employment of certain new employees).
  227         5.4. There shall be subtracted from such taxable income any
  228  amount of nonbusiness income included therein.
  229         6.5. There shall be subtracted any amount of taxes of
  230  foreign countries allowable as credits for taxable years
  231  beginning on or after September 1, 1985, under s. 901 of the
  232  Internal Revenue Code to any corporation which derived less than
  233  20 percent of its gross income or loss for its taxable year
  234  ended in 1984 from sources within the United States, as
  235  described in s. 861(a)(2)(A) of the Internal Revenue Code, not
  236  including credits allowed under ss. 902 and 960 of the Internal
  237  Revenue Code, withholding taxes on dividends within the meaning
  238  of sub-subparagraph 2.a., and withholding taxes on royalties,
  239  interest, technical service fees, and capital gains.
  240         7.6. Notwithstanding any other provision of this code,
  241  except with respect to amounts subtracted pursuant to
  242  subparagraphs 1. and 4. 3., any increment of any apportionment
  243  factor which is directly related to an increment of gross
  244  receipts or income which is deducted, subtracted, or otherwise
  245  excluded in determining adjusted federal income shall be
  246  excluded from both the numerator and denominator of such
  247  apportionment factor. Further, all valuations made for
  248  apportionment factor purposes shall be made on a basis
  249  consistent with the taxpayer’s method of accounting for federal
  250  income tax purposes.
  251         (c) Installment sales occurring after October 19, 1980.—
  252         1. In the case of any disposition made after October 19,
  253  1980, the income from an installment sale shall be taken into
  254  account for the purposes of this code in the same manner that
  255  such income is taken into account for federal income tax
  256  purposes.
  257         2. Any taxpayer who regularly sells or otherwise disposes
  258  of personal property on the installment plan and reports the
  259  income therefrom on the installment method for federal income
  260  tax purposes under s. 453(a) of the Internal Revenue Code shall
  261  report such income in the same manner under this code.
  262         (d) Nonallowable deductions.—A deduction for net operating
  263  losses, net capital losses, or excess contributions deductions
  264  under ss. 170(d)(2), 172, 1212, and 404 of the Internal Revenue
  265  Code which has been allowed in a prior taxable year for Florida
  266  tax purposes shall not be allowed for Florida tax purposes,
  267  notwithstanding the fact that such deduction has not been fully
  268  utilized for federal tax purposes.
  269         (e) Adjustments related to federal acts.—Taxpayers shall be
  270  required to make the adjustments prescribed in this paragraph
  271  for Florida tax purposes with respect to certain tax benefits
  272  received pursuant to the Economic Stimulus Act of 2008; the
  273  American Recovery and Reinvestment Act of 2009; the Small
  274  Business Jobs Act of 2010; the Tax Relief, Unemployment
  275  Insurance Reauthorization, and Job Creation Act of 2010; the
  276  American Taxpayer Relief Act of 2012; the Tax Increase
  277  Prevention Act of 2014; the Consolidated Appropriations Act,
  278  2016; the Tax Cuts and Jobs Act of 2017; and the Coronavirus
  279  Aid, Relief, and Economic Security Act of 2020.
  280         1.a. There shall be added to such taxable income an amount
  281  equal to 100 percent of any amount deducted for federal income
  282  tax purposes as bonus depreciation for the taxable year pursuant
  283  to ss. 167 and 168(k) of the Internal Revenue Code of 1986, as
  284  amended by s. 103 of Pub. L. No. 110-185; s. 1201 of Pub. L. No.
  285  111-5; s. 2022 of Pub. L. No. 111-240; s. 401 of Pub. L. No.
  286  111-312; s. 331 of Pub. L. No. 112-240; s. 125 of Pub. L. No.
  287  113-295; s. 143 of Division Q of Pub. L. No. 114-113; and s.
  288  13201 of Pub. L. No. 115-97, for property placed in service
  289  after December 31, 2007, and before January 1, 2027.
  290         b. For the taxable year and for each of the 6 subsequent
  291  taxable years, there shall be subtracted from such taxable
  292  income an amount equal to one-seventh of the amount by which
  293  taxable income was increased pursuant to this subparagraph,
  294  notwithstanding any sale or other disposition of the property
  295  that is the subject of the adjustments and regardless of whether
  296  such property remains in service in the hands of the taxpayer.
  297         c. The provisions of sub-subparagraph b. do not apply to
  298  amounts by which taxable income was increased pursuant to this
  299  subparagraph for amounts deducted for federal income tax
  300  purposes as bonus depreciation for qualified improvement
  301  property as defined in s. 168(e)(6) of the Internal Revenue Code
  302  of 1986, as amended by s. 13204 of Pub. L. No. 115-97.
  303         2. There shall be added to such taxable income an amount
  304  equal to 100 percent of any amount in excess of $128,000
  305  deducted for federal income tax purposes for the taxable year
  306  pursuant to s. 179 of the Internal Revenue Code of 1986, as
  307  amended by s. 102 of Pub. L. No. 110-185; s. 1202 of Pub. L. No.
  308  111-5; s. 2021 of Pub. L. No. 111-240; s. 402 of Pub. L. No.
  309  111-312; s. 315 of Pub. L. No. 112-240; and s. 127 of Pub. L.
  310  No. 113-295, for taxable years beginning after December 31,
  311  2007, and before January 1, 2015. For the taxable year and for
  312  each of the 6 subsequent taxable years, there shall be
  313  subtracted from such taxable income one-seventh of the amount by
  314  which taxable income was increased pursuant to this
  315  subparagraph, notwithstanding any sale or other disposition of
  316  the property that is the subject of the adjustments and
  317  regardless of whether such property remains in service in the
  318  hands of the taxpayer.
  319         3. There shall be added to such taxable income an amount
  320  equal to the amount of deferred income not included in such
  321  taxable income pursuant to s. 108(i)(1) of the Internal Revenue
  322  Code of 1986, as amended by s. 1231 of Pub. L. No. 111-5. There
  323  shall be subtracted from such taxable income an amount equal to
  324  the amount of deferred income included in such taxable income
  325  pursuant to s. 108(i)(1) of the Internal Revenue Code of 1986,
  326  as amended by s. 1231 of Pub. L. No. 111-5.
  327         4. For taxable years beginning after December 31, 2018, and
  328  before January 1, 2021, there shall be added to such taxable
  329  income an amount equal to the excess, if any, of:
  330         a. One hundred percent of any amount deducted for federal
  331  income tax purposes as business interest expense for the taxable
  332  year pursuant to s. 163(j) of the Internal Revenue Code of 1986,
  333  as amended by s. 2306 of Pub. L. No. 116-136; over
  334         b. One hundred percent of the amount that would be
  335  deductible for federal income tax purposes as business interest
  336  expense for the taxable year if calculated pursuant to s. 163(j)
  337  of the Internal Revenue Code of 1986, as amended by s. 13301 of
  338  Pub. L. No. 115-97.
  339  
  340  Any expense added back pursuant to this subparagraph shall be
  341  treated as a disallowed business expense carryforward from prior
  342  years for the year or years following the addition, until such
  343  time as the expense has been used.
  344         5. With respect to qualified improvement property as
  345  defined in s. 168(e)(6) of the Internal Revenue Code of 1986, as
  346  amended by s. 13204 of Pub. L. No. 115-97, that was placed in
  347  service on or after January 1, 2018:
  348         a. There shall be added to such taxable income an amount
  349  equal to 100 percent of any amount deducted for federal income
  350  tax purposes under s. 167(a) of the Internal Revenue Code of
  351  1986. There shall be subtracted an amount equal to the amount of
  352  depreciation that would have been deductible pursuant to s.
  353  167(a) of the Internal Revenue Code of 1986 in effect on January
  354  1, 2020 and without regard to s. 2307 of Pub. L. No. 116-136,
  355  notwithstanding any sale or other disposition of the property
  356  that is the subject of the adjustments and regardless of whether
  357  such property remains in service in the hands of the taxpayer.
  358         b. The department may adopt rules necessary to administer
  359  the provisions of this subparagraph, including rules, forms, and
  360  guidelines for computing depreciation on qualified improvement
  361  property, as defined in s. 168(e)(6) of the Internal Revenue
  362  Code of 1986.
  363         6. For taxable years beginning after December 31, 2020, and
  364  before January 1, 2026, the changes made to the Internal Revenue
  365  Code by Pub. L. No. 116-260, Division EE, Title I, s. 116 and
  366  Title II, s. 210 shall not apply to this chapter. Taxable income
  367  under this section shall be calculated as though changes made by
  368  those sections were not made to the Internal Revenue Code. The
  369  Department of Revenue may adopt rules necessary to administer
  370  the provisions of this subparagraph, including rules, forms, and
  371  guidelines for treatment of expenses and depreciation related to
  372  these changes.
  373         7. Subtractions available under this paragraph may be
  374  transferred to the surviving or acquiring entity following a
  375  merger or acquisition and used in the same manner and with the
  376  same limitations as specified by this paragraph.
  377         8. The additions and subtractions specified in this
  378  paragraph are intended to adjust taxable income for Florida tax
  379  purposes, and, notwithstanding any other provision of this code,
  380  such additions and subtractions shall be permitted to change a
  381  taxpayer’s net operating loss for Florida tax purposes.
  382         (2) For purposes of this section, a taxpayer’s taxable
  383  income for the taxable year means taxable income as defined in
  384  s. 63 of the Internal Revenue Code and properly reportable for
  385  federal income tax purposes for the taxable year, but subject to
  386  the limitations set forth in paragraph (1)(b) with respect to
  387  the deductions provided by ss. 172 (relating to net operating
  388  losses), 170(d)(2) (relating to excess charitable
  389  contributions), 404(a)(1)(D) (relating to excess pension trust
  390  contributions), 404(a)(3)(A) and (B) (to the extent relating to
  391  excess stock bonus and profit-sharing trust contributions), and
  392  1212 (relating to capital losses) of the Internal Revenue Code,
  393  except that, subject to the same limitations, the term:
  394         (f) “Taxable income,” in the case of a corporation which is
  395  a member of an affiliated group of corporations filing a
  396  consolidated income tax return for the taxable year for federal
  397  income tax purposes, means taxable income of such corporation
  398  for federal income tax purposes as if such corporation had filed
  399  a separate federal income tax return for the taxable year and
  400  each preceding taxable year for which it was a member of an
  401  affiliated group, unless a consolidated return for the taxpayer
  402  and others is required or elected under s. 220.131;
  403         Section 3. Section 220.131, Florida Statutes, is repealed.
  404         Section 4. Section 220.136, Florida Statutes, is created to
  405  read:
  406         220.136Determination of the members of a unitary combined
  407  group.—A corporation having 50 percent or more of its
  408  outstanding voting stock directly or indirectly owned or
  409  controlled by a unitary combined group is a member of the
  410  unitary combined group. A corporation having less than 50
  411  percent of its outstanding voting stock directly or indirectly
  412  owned or controlled by a unitary combined group is a member of
  413  the unitary combined group if the business activities of the
  414  corporation show that the corporation is a member of the unitary
  415  combined group. All of the income of a corporation that is a
  416  member of a unitary combined group is unitary. For purposes of
  417  this subsection, the attribution rules of 26 U.S.C. s. 318 must
  418  be used to determine whether voting stock is indirectly owned.
  419         Section 5. Section 220.1363, Florida Statutes, is created
  420  to read:
  421         220.1363Unitary combined groups; special requirements.—
  422         (1)For purposes of this section, the term “unitary
  423  combined reporting method” means a method used to determine the
  424  taxable business profits of a group of entities conducting a
  425  unitary business. Under this method, the net income of the
  426  entities must be added together, along with the additions and
  427  subtractions under s. 220.13, and apportioned to this state as a
  428  single taxpayer under ss. 220.15 and 220.151. However, each
  429  special industry member included in a unitary combined group
  430  return, which would otherwise be permitted to use a special
  431  method of apportionment under s. 220.151, shall convert its
  432  single-factor apportionment to a three-factor apportionment of
  433  property, payroll, and sales. The special industry member shall
  434  calculate the denominator of its property, payroll, and sales
  435  factors in the same manner as those denominators are calculated
  436  by members that are not special industry members. The numerator
  437  of its sales, property, and payroll factors is the product of
  438  the denominator of each factor multiplied by the premiums or
  439  revenue-miles-factor ratio otherwise applicable under s.
  440  220.151.
  441         (2)All members of a unitary combined group must use the
  442  unitary combined reporting method, under which:
  443         (a)Adjusted federal income, for purposes of s. 220.12,
  444  means the sum of adjusted federal income of all members of the
  445  unitary combined group as determined for a concurrent taxable
  446  year.
  447         (b)The numerators and denominators of the apportionment
  448  factors must be calculated for all members of the unitary
  449  combined group combined.
  450         (c)Intercompany sales transactions between members of the
  451  unitary combined group are not included in the numerator or
  452  denominator of the sales factor under ss. 220.15 and 220.151,
  453  regardless of whether indicia of a sale exist.
  454         (d)For sales of intangibles, including, but not limited
  455  to, accounts receivable, notes, bonds, and stock, which are made
  456  to entities outside the group, only the net proceeds are
  457  included in the numerator and denominator of the sales factor.
  458  
  459  As used in this subsection, the term “sale” includes, but is not
  460  limited to, loans, payments for the use of intangibles,
  461  dividends, and management fees.
  462         (3)(a)If a parent corporation is a member of the unitary
  463  combined group and has nexus with this state, a single unitary
  464  combined group return must be filed in the name and under the
  465  federal employer identification number of the parent
  466  corporation. If the unitary combined group does not have a
  467  parent corporation, if the parent corporation is not a member of
  468  the unitary combined group, or if the parent corporation does
  469  not have nexus with this state, the members of the unitary
  470  combined group must choose a member subject to the tax imposed
  471  by this chapter to file the return. The members of the unitary
  472  combined group may not choose another member to file a corporate
  473  income tax return in subsequent years unless the filing member
  474  does not maintain nexus with this state or does not remain a
  475  member of the unitary combined group. The return must be signed
  476  by an authorized officer of the filing member as the agent for
  477  the unitary combined group.
  478         (b)If members of a unitary combined group have different
  479  taxable years, the taxable year of a majority of the members of
  480  the unitary combined group is the taxable year of the unitary
  481  combined group. If the taxable years of a majority of the
  482  members of a unitary combined group do not correspond, the
  483  taxable year of the member that must file the return for the
  484  unitary combined group is the taxable year of the unitary
  485  combined group.
  486         (c)1.A member of a unitary combined group having a taxable
  487  year that does not correspond to the taxable year of the unitary
  488  combined group shall determine its income for inclusion on the
  489  tax return for the unitary combined group. The member shall use:
  490         a.The precise amount of taxable income received during the
  491  months corresponding to the taxable year of the unitary combined
  492  group, if the precise amount can be readily determined from the
  493  member’s books and records.
  494         b.The taxable income of the member converted to conform to
  495  the taxable year of the unitary combined group on the basis of
  496  the number of months falling within the taxable year of the
  497  unitary combined group. For example, if the taxable year of the
  498  unitary combined group is a calendar year and a member operates
  499  on a fiscal year ending on April 30, the income of the member
  500  must include 8/12 of the income from the current taxable year
  501  and 4/12 of the income from the preceding taxable year. This
  502  method to determine the income of a member may be used only if
  503  the return can be timely filed after the end of the taxable year
  504  of the unitary combined group.
  505         c.The taxable income of the member during its taxable year
  506  that ends within the taxable year of the unitary combined group.
  507         2.The method of determining the income of a member of a
  508  unitary combined group whose taxable year does not correspond to
  509  the taxable year of the unitary combined group may not change as
  510  long as the member remains a member of the unitary combined
  511  group. The apportionment factors for the member must be applied
  512  to the income of the member for the taxable year of the unitary
  513  combined group.
  514         (4)(a)A unitary combined group return must include a
  515  computational schedule that:
  516         1.Combines the federal income of all members of the
  517  unitary combined group;
  518         2.Shows all intercompany eliminations;
  519         3.Shows Florida additions and subtractions under s.
  520  220.13; and
  521         4.Shows the calculation of the combined apportionment
  522  factors.
  523         (b)In addition to its return, a unitary combined group
  524  shall also file a domestic disclosure spreadsheet. The
  525  spreadsheet must fully disclose:
  526         1.The income reported to each state;
  527         2.The state tax liability;
  528         3.The method used for apportioning or allocating income to
  529  the various states; and
  530         4.Other information required by department rule in order
  531  to determine the proper amount of tax due to each state and to
  532  identify the unitary combined group.
  533         (5)The director may take any of the following actions if
  534  he or she believes that such action is necessary to prevent
  535  substantial tax avoidance by the unitary combined group:
  536         (a)Add the income or apportionment factors of a related
  537  entity to the unitary combined group return if the related
  538  entity is not subject to corporate income tax.
  539         (b)Adjust the income or apportionment factor of a member
  540  of the unitary combined group if such member is subject to
  541  industry-specific apportionment rules.
  542         (6)The department may adopt rules and forms to administer
  543  this section. The Legislature intends to grant the department
  544  extensive authority to adopt rules and forms describing and
  545  defining principles for determining the existence of a unitary
  546  combined business, definitions of common control, methods of
  547  reporting, and related forms, principles, and other definitions.
  548         Section 6. Subsections (2), (3), and (4) of section 220.14,
  549  Florida Statutes, are amended to read:
  550         220.14 Exemption.—
  551         (2) In the case of a taxable year for a period of less than
  552  12 months, the exemption allowed by this section must shall be
  553  prorated on the basis of the number of days in such year to 365
  554  days, or, in a leap year, 366 days.
  555         (3) Only one exemption shall be allowed to taxpayers filing
  556  a unitary combined group consolidated return under this code.
  557         (4) Notwithstanding any other provision of this code, not
  558  more than one exemption under this section may be allowed to the
  559  Florida members of a controlled group of corporations, as
  560  defined in s. 1563 of the Internal Revenue Code with respect to
  561  taxable years ending on or after December 31, 1970, filing
  562  separate returns under this code. The exemption described in
  563  this section shall be divided equally among such Florida members
  564  of the group, unless all of such members consent, at such time
  565  and in such manner as the department shall by regulation
  566  prescribe, to an apportionment plan providing for an unequal
  567  allocation of such exemption.
  568         Section 7. Paragraphs (b) and (c) of subsection (5) of
  569  section 220.15, Florida Statutes, are amended to read:
  570         220.15 Apportionment of adjusted federal income.—
  571         (5) The sales factor is a fraction the numerator of which
  572  is the total sales of the taxpayer in this state during the
  573  taxable year or period and the denominator of which is the total
  574  sales of the taxpayer everywhere during the taxable year or
  575  period.
  576         (b)1. Sales of tangible personal property occur in this
  577  state if:
  578         a. The property is delivered or shipped to a purchaser,
  579  other than the United States Government, within this state,
  580  regardless of the f.o.b. point, other conditions of the sale, or
  581  ultimate destination of the property, unless shipment is made
  582  via a common or contract carrier; or
  583         b.The property is shipped from an office, a store, a
  584  warehouse, a factory, or other place of storage in this state,
  585  and the purchaser is the United States Government or the
  586  taxpayer is not taxable in the purchaser’s state.
  587  
  588  However, for industries in NAICS National Number 311411, if the
  589  ultimate destination of the product is to a location outside
  590  this state, regardless of the method of shipment or f.o.b.
  591  point, the sale shall not be deemed to occur in this state. As
  592  used in this paragraph, “NAICS” means those classifications
  593  contained in the North American Industry Classification System,
  594  as published in 2007 by the Office of Management and Budget,
  595  Executive Office of the President.
  596         2. When citrus fruit is delivered by a cooperative for a
  597  grower-member, by a grower-member to a cooperative, or by a
  598  grower-participant to a Florida processor, the sales factor for
  599  the growers for such citrus fruit delivered to such processor
  600  shall be the same as the sales factor for the most recent
  601  taxable year of that processor. That sales factor, expressed
  602  only as a percentage and not in terms of the dollar volume of
  603  sales, so as to protect the confidentiality of the sales of the
  604  processor, shall be furnished on the request of such a grower
  605  promptly after it has been determined for that taxable year.
  606         3. Reimbursement of expenses under an agency contract
  607  between a cooperative, a grower-member of a cooperative, or a
  608  grower and a processor is not a sale within this state.
  609         (c) Sales of a financial organization, including, but not
  610  limited to, banking and savings institutions, investment
  611  companies, real estate investment trusts, and brokerage
  612  companies, occur in this state if derived from:
  613         1. Fees, commissions, or other compensation for financial
  614  services rendered within this state;
  615         2. Gross profits from trading in stocks, bonds, or other
  616  securities managed within this state;
  617         3. Interest received within this state, other than interest
  618  from loans secured by mortgages, deeds of trust, or other liens
  619  upon real or tangible personal property located without this
  620  state, and dividends received within this state;
  621         4. Interest charged to customers at places of business
  622  maintained within this state for carrying debit balances of
  623  margin accounts, without deduction of any costs incurred in
  624  carrying such accounts;
  625         5. Interest, fees, commissions, or other charges or gains
  626  from loans secured by mortgages, deeds of trust, or other liens
  627  upon real or tangible personal property located in this state or
  628  from installment sale agreements originally executed by a
  629  taxpayer or the taxpayer’s agent to sell real or tangible
  630  personal property located in this state;
  631         6. Rents from real or tangible personal property located in
  632  this state; or
  633         7. Any other gross income, including other interest,
  634  resulting from the operation as a financial organization within
  635  this state.
  636  
  637  In computing the amounts under this paragraph, any amount
  638  received by a member of an affiliated group (determined under s.
  639  1504(a) of the Internal Revenue Code, but without reference to
  640  whether any such corporation is an “includable corporation”
  641  under s. 1504(b) of the Internal Revenue Code) from another
  642  member of such group shall be included only to the extent such
  643  amount exceeds expenses of the recipient directly related
  644  thereto.
  645         Section 8. Paragraph (f) of subsection (1) of section
  646  220.183, Florida Statutes, is amended to read:
  647         220.183 Community contribution tax credit.—
  648         (1) AUTHORIZATION TO GRANT COMMUNITY CONTRIBUTION TAX
  649  CREDITS; LIMITATIONS ON INDIVIDUAL CREDITS AND PROGRAM
  650  SPENDING.—
  651         (f)A taxpayer who files a Florida consolidated return as a
  652  member of an affiliated group pursuant to s. 220.131(1) may be
  653  allowed the credit on a consolidated return basis.
  654         Section 9. Paragraphs (e) through (k) of subsection (2) of
  655  section 220.1845, Florida Statutes, are redesignated as
  656  paragraphs (d) through (j), respectively, and paragraphs (b) and
  657  (c) and present paragraph (d) of that subsection are amended to
  658  read:
  659         220.1845 Contaminated site rehabilitation tax credit.—
  660         (2) AUTHORIZATION FOR TAX CREDIT; LIMITATIONS.—
  661         (b) A tax credit applicant, or multiple tax credit
  662  applicants working jointly to clean up a single site, may not be
  663  granted more than $500,000 per year in tax credits for each site
  664  voluntarily rehabilitated. Multiple tax credit applicants shall
  665  be granted tax credits in the same proportion as their
  666  contribution to payment of cleanup costs. Subject to the same
  667  conditions and limitations as provided in this section, a
  668  municipality, county, or other tax credit applicant which
  669  voluntarily rehabilitates a site may receive not more than
  670  $500,000 per year in tax credits which it can subsequently
  671  transfer subject to the provisions in paragraph (f)(g).
  672         (c) If the credit granted under this section is not fully
  673  used in any one year because of insufficient tax liability on
  674  the part of the corporation, the unused amount may be carried
  675  forward for up to 5 years. The carryover credit may be used in a
  676  subsequent year if the tax imposed by this chapter for that year
  677  exceeds the credit for which the corporation is eligible in that
  678  year after applying the other credits and unused carryovers in
  679  the order provided by s. 220.02(8). If during the 5-year period
  680  the credit is transferred, in whole or in part, pursuant to
  681  paragraph (f)(g), each transferee has 5 years after the date of
  682  transfer to use its credit.
  683         (d)A taxpayer that files a consolidated return in this
  684  state as a member of an affiliated group under s. 220.131(1) may
  685  be allowed the credit on a consolidated return basis up to the
  686  amount of tax imposed upon the consolidated group.
  687         Section 10. Subsection (2) of section 220.1875, Florida
  688  Statutes, is amended to read:
  689         220.1875 Credit for contributions to eligible nonprofit
  690  scholarship-funding organizations.—
  691         (2)A taxpayer who files a Florida consolidated return as a
  692  member of an affiliated group pursuant to s. 220.131(1) may be
  693  allowed the credit on a consolidated return basis; however, the
  694  total credit taken by the affiliated group is subject to the
  695  limitation established under subsection (1).
  696         Section 11. Subsection (2) of section 220.1876, Florida
  697  Statutes, is amended to read:
  698         220.1876 Credit for contributions to the New Worlds Reading
  699  Initiative.—
  700         (2)A taxpayer who files a Florida consolidated return as a
  701  member of an affiliated group pursuant to s. 220.131(1) may be
  702  allowed the credit on a consolidated return basis; however, the
  703  total credit taken by the affiliated group is subject to the
  704  limitation established under subsection (1).
  705         Section 12. Subsection (2) of section 220.1877, Florida
  706  Statutes, is amended to read:
  707         220.1877 Credit for contributions to eligible charitable
  708  organizations.—
  709         (2)A taxpayer who files a Florida consolidated return as a
  710  member of an affiliated group pursuant to s. 220.131(1) may be
  711  allowed the credit on a consolidated return basis; however, the
  712  total credit taken by the affiliated group is subject to the
  713  limitation established under subsection (1).
  714         Section 13. Paragraphs (a) and (c) of subsection (3) of
  715  section 220.191, Florida Statutes, are amended to read:
  716         220.191 Capital investment tax credit.—
  717         (3)(a) Notwithstanding subsection (2), an annual credit
  718  against the tax imposed by this chapter shall be granted to a
  719  qualifying business which establishes a qualifying project
  720  pursuant to subparagraph (1)(g)3., in an amount equal to the
  721  lesser of $15 million or 5 percent of the eligible capital costs
  722  made in connection with a qualifying project, for a period not
  723  to exceed 20 years beginning with the commencement of operations
  724  of the project. The tax credit shall be granted against the
  725  corporate income tax liability of the qualifying business and as
  726  further provided in paragraph (c). The total tax credit provided
  727  pursuant to this subsection shall be equal to no more than 100
  728  percent of the eligible capital costs of the qualifying project.
  729         (c) The credit granted under this subsection may be used in
  730  whole or in part by the qualifying business or any corporation
  731  that is either a member of that qualifying business’s affiliated
  732  group of corporations, is a related entity taxable as a
  733  cooperative under subchapter T of the Internal Revenue Code, or,
  734  if the qualifying business is an entity taxable as a cooperative
  735  under subchapter T of the Internal Revenue Code, is related to
  736  the qualifying business. Any entity related to the qualifying
  737  business may continue to file as a member of a Florida-nexus
  738  consolidated group pursuant to a prior election made under s.
  739  220.131(1), Florida Statutes (1985), even if the parent of the
  740  group changes due to a direct or indirect acquisition of the
  741  former common parent of the group. Any credit can be used by any
  742  of the affiliated companies or related entities referenced in
  743  this paragraph to the same extent as it could have been used by
  744  the qualifying business. However, any such use shall not operate
  745  to increase the amount of the credit or extend the period within
  746  which the credit must be used.
  747         Section 14. Paragraphs (f) through (j) of subsection (3) of
  748  section 220.193, Florida Statutes, are redesignated as
  749  paragraphs (e) through (i), respectively, and paragraph (c) and
  750  present paragraph (e) of that subsection are amended to read:
  751         220.193 Florida renewable energy production credit.—
  752         (3) An annual credit against the tax imposed by this
  753  section shall be allowed to a taxpayer, based on the taxpayer’s
  754  production and sale of electricity from a new or expanded
  755  Florida renewable energy facility. For a new facility, the
  756  credit shall be based on the taxpayer’s sale of the facility’s
  757  entire electrical production. For an expanded facility, the
  758  credit shall be based on the increases in the facility’s
  759  electrical production that are achieved after May 1, 2012.
  760         (c) If the amount of credits applied for each year exceeds
  761  the amount authorized in paragraph (f)(g), the Department of
  762  Agriculture and Consumer Services shall allocate credits to
  763  qualified applicants based on the following priority:
  764         1. An applicant who places a new facility in operation
  765  after May 1, 2012, shall be allocated credits first, up to a
  766  maximum of $250,000 each, with any remaining credits to be
  767  granted pursuant to subparagraph 3., but if the claims for
  768  credits under this subparagraph exceed the state fiscal year cap
  769  in paragraph (f)(g), credits shall be allocated pursuant to this
  770  subparagraph on a prorated basis based upon each applicant’s
  771  qualified production and sales as a percentage of total
  772  production and sales for all applicants in this category for the
  773  fiscal year.
  774         2. An applicant who does not qualify under subparagraph 1.
  775  but who claims a credit of $50,000 or less shall be allocated
  776  credits next, but if the claims for credits under this
  777  subparagraph, combined with credits allocated in subparagraph
  778  1., exceed the state fiscal year cap in paragraph (f)(g),
  779  credits shall be allocated pursuant to this subparagraph on a
  780  prorated basis based upon each applicant’s qualified production
  781  and sales as a percentage of total qualified production and
  782  sales for all applicants in this category for the fiscal year.
  783         3. An applicant who does not qualify under subparagraph 1.
  784  or subparagraph 2. and an applicant whose credits have not been
  785  fully allocated under subparagraph 1. shall be allocated credits
  786  next. If there is insufficient capacity within the amount
  787  authorized for the state fiscal year in paragraph (f)(g), and
  788  after allocations pursuant to subparagraphs 1. and 2., the
  789  credits allocated under this subparagraph shall be prorated
  790  based upon each applicant’s unallocated claims for qualified
  791  production and sales as a percentage of total unallocated claims
  792  for qualified production and sales of all applicants in this
  793  category, up to a maximum of $1 million per taxpayer per state
  794  fiscal year. If, after application of this $1 million cap, there
  795  is excess capacity under the state fiscal year cap in paragraph
  796  (f)(g) in any state fiscal year, that remaining capacity shall
  797  be used to allocate additional credits with priority given in
  798  the order set forth in this subparagraph and without regard to
  799  the $1 million per taxpayer cap.
  800         (e)A taxpayer that files a consolidated return in this
  801  state as a member of an affiliated group under s. 220.131(1) may
  802  be allowed the credit on a consolidated return basis up to the
  803  amount of tax imposed upon the consolidated group.
  804         Section 15. Section 220.51, Florida Statutes, is amended to
  805  read:
  806         220.51 Adoption Promulgation of rules and regulations.—In
  807  accordance with the Administrative Procedure Act, chapter 120,
  808  the department is authorized to make, adopt promulgate, and
  809  enforce such reasonable rules and regulations, and to prescribe
  810  such forms relating to the administration and enforcement of the
  811  provisions of this code, as it may deem appropriate, including:
  812         (1) Rules for initial implementation of this code and for
  813  taxpayers’ transitional taxable years commencing before and
  814  ending after January 1, 1972; and
  815         (2) Rules or regulations to clarify whether certain groups,
  816  organizations, or associations formed under the laws of this
  817  state or any other state, country, or jurisdiction shall be
  818  deemed “taxpayers” for the purposes of this code, in accordance
  819  with the legislative declarations of intent in s. 220.02; and
  820         (3)Regulations relating to consolidated reporting for
  821  affiliated groups of corporations, in order to provide for an
  822  equitable and just administration of this code with respect to
  823  multicorporate taxpayers.
  824         Section 16. Section 220.64, Florida Statutes, is amended to
  825  read:
  826         220.64 Other provisions applicable to franchise tax.—To the
  827  extent that they are not manifestly incompatible with the
  828  provisions of this part, parts I, III, IV, V, VI, VIII, IX, and
  829  X of this code and ss. 220.12, 220.13, 220.136, 220.1363,
  830  220.15, and 220.16 apply to the franchise tax imposed by this
  831  part. Under rules prescribed by the department in s. 220.131, a
  832  consolidated return may be filed by any affiliated group of
  833  corporations composed of one or more banks or savings
  834  associations, its or their Florida parent corporations
  835  corporation, and any nonbank or nonsavings subsidiaries of such
  836  parent corporations corporation.
  837         Section 17. Paragraph (g) and (h) of subsection (4) of
  838  section 288.1254, Florida Statutes, are redesignated as
  839  paragraphs (f) and (g), respectively, and present paragraph (f)
  840  of subsection (4) and paragraph (a) of subsection (5) are
  841  amended to read:
  842         288.1254 Entertainment industry financial incentive
  843  program.—
  844         (4) TAX CREDIT ELIGIBILITY; TAX CREDIT AWARDS; QUEUES;
  845  ELECTION AND DISTRIBUTION; CARRYFORWARD; CONSOLIDATED RETURNS;
  846  PARTNERSHIP AND NONCORPORATE DISTRIBUTIONS; MERGERS AND
  847  ACQUISITIONS.—
  848         (f)Consolidated returns.—A certified production company
  849  that files a Florida consolidated return as a member of an
  850  affiliated group under s. 220.131(1) may be allowed the credit
  851  on a consolidated return basis up to the amount of the tax
  852  imposed upon the consolidated group under chapter 220.
  853         (5) TRANSFER OF TAX CREDITS.—
  854         (a) Authorization.—Upon application to the Office of Film
  855  and Entertainment and approval by the department, a certified
  856  production company, or a partner or member that has received a
  857  distribution under paragraph (4)(f)(4)(g), may elect to
  858  transfer, in whole or in part, any unused credit amount granted
  859  under this section. An election to transfer any unused tax
  860  credit amount under chapter 212 or chapter 220 must be made no
  861  later than 5 years after the date the credit is awarded, after
  862  which period the credit expires and may not be used. The
  863  department shall notify the Department of Revenue of the
  864  election and transfer.
  865         Section 18. Subsections (9) and (10) of section 376.30781,
  866  Florida Statutes, are amended to read:
  867         376.30781 Tax credits for rehabilitation of drycleaning
  868  solvent-contaminated sites and brownfield sites in designated
  869  brownfield areas; application process; rulemaking authority;
  870  revocation authority.—
  871         (9) On or before May 1, the Department of Environmental
  872  Protection shall inform each tax credit applicant that is
  873  subject to the January 31 annual application deadline of the
  874  applicant’s eligibility status and the amount of any tax credit
  875  due. The department shall provide each eligible tax credit
  876  applicant with a tax credit certificate that must be submitted
  877  with its tax return to the Department of Revenue to claim the
  878  tax credit or be transferred pursuant to s. 220.1845(2)(f) s.
  879  220.1845(2)(g). The May 1 deadline for annual site
  880  rehabilitation tax credit certificate awards shall not apply to
  881  any tax credit application for which the department has issued a
  882  notice of deficiency pursuant to subsection (8). The department
  883  shall respond within 90 days after receiving a response from the
  884  tax credit applicant to such a notice of deficiency. Credits may
  885  not result in the payment of refunds if total credits exceed the
  886  amount of tax owed.
  887         (10) For solid waste removal, new health care facility or
  888  health care provider, and affordable housing tax credit
  889  applications, the Department of Environmental Protection shall
  890  inform the applicant of the department’s determination within 90
  891  days after the application is deemed complete. Each eligible tax
  892  credit applicant shall be informed of the amount of its tax
  893  credit and provided with a tax credit certificate that must be
  894  submitted with its tax return to the Department of Revenue to
  895  claim the tax credit or be transferred pursuant to s.
  896  220.1845(2)(f) s. 220.1845(2)(g). Credits may not result in the
  897  payment of refunds if total credits exceed the amount of tax
  898  owed.
  899         Section 19. Transitional rules.—
  900         (1)For the first taxable year beginning on or after
  901  January 1, 2024, a taxpayer that filed a Florida corporate
  902  income tax return in the preceding taxable year and that is a
  903  member of a unitary combined group shall compute its income
  904  together with all members of its unitary combined group and file
  905  a combined Florida corporate income tax return with all members
  906  of its unitary combined group.
  907         (2)An affiliated group of corporations which filed a
  908  Florida consolidated corporate income tax return pursuant to an
  909  election provided in former s. 220.131, Florida Statutes, shall
  910  cease filing a Florida consolidated return for taxable years
  911  beginning on or after January 1, 2024, and shall file a combined
  912  Florida corporate income tax return with all members of its
  913  unitary combined group.
  914         (3)An affiliated group of corporations which filed a
  915  Florida consolidated corporate income tax return pursuant to the
  916  election in s. 220.131(1), Florida Statutes (1985), which
  917  allowed the affiliated group to make an election within 90 days
  918  after December 20, 1984, or upon filing the taxpayer’s first
  919  return after December 20, 1984, whichever was later, shall cease
  920  filing a Florida consolidated corporate income tax return using
  921  that method for taxable years beginning on or after January 1,
  922  2024, and shall file a combined Florida corporate income tax
  923  return with all members of its unitary combined group.
  924         (4)A taxpayer that is not a member of a unitary combined
  925  group remains subject to chapter 220, Florida Statutes, and
  926  shall file a separate Florida corporate income tax return as
  927  previously required.
  928         (5)For taxable years beginning on or after January 1,
  929  2024, a tax return for a member of a unitary combined group must
  930  be a combined Florida corporate income tax return that includes
  931  tax information for all members of the unitary combined group.
  932  The tax return must be filed by a member that has a nexus with
  933  this state.
  934         Section 20. Any additional revenue received as a result of
  935  the enactment of this act must be deposited into the General
  936  Revenue Fund.
  937         Section 21. This act shall take effect July 1, 2023.