House Bill 3351er

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  2         An act relating to corporate income tax;

  3         amending s. 220.15, F.S., which provides for

  4         apportionment of adjusted federal income for

  5         corporate income tax purposes; providing that

  6         the property factor fraction shall not include

  7         property certified as dedicated to research and

  8         development pursuant to sponsored research

  9         conducted through certain universities;

10         providing a definition; providing that the

11         payroll factor shall not include compensation

12         paid to employees certified as dedicated to

13         such activities; providing that no such

14         activities shall cause a corporation not

15         otherwise subject to corporate income tax to be

16         subject to said tax; providing limitations;

17         providing for rules; requiring a report;

18         providing an effective date.

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20  Be It Enacted by the Legislature of the State of Florida:

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22         Section 1.  Paragraph (c) is added to subsection (2)

23  and paragraph (c) is added to subsection (4) of section

24  220.15, Florida Statutes, and subsection (8) is added to said

25  section, to read:

26         220.15  Apportionment of adjusted federal income.--

27         (2)  The property factor is a fraction the numerator of

28  which is the average value of the taxpayer's real and tangible

29  personal property owned or rented and used in this state

30  during the taxable year or period and the denominator of which

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  1  is the average value of such property owned or rented and used

  2  everywhere.

  3         (c)  The property factor fraction shall not include any

  4  real or tangible personal property located in this state with

  5  respect to which it is certified to the Department of Revenue

  6  that such property is dedicated exclusively to research and

  7  development activities performed pursuant to sponsored

  8  research contracts conducted in conjunction with and through a

  9  university that is a member of the State University System or

10  a nonpublic university that is chartered in Florida and

11  conducts graduate programs at the professional or doctoral

12  level. The Board of Regents must certify the contracts for

13  members of the State University System and the president of

14  the university must certify the contracts for a nonpublic

15  university. As used in this paragraph, "sponsored research

16  contract" means an agreement executed by parties that include

17  at least the university and the taxpayer. Funding for

18  sponsored research contracts may be provided from public or

19  private sources.

20         (4)  The payroll factor is a fraction the numerator of

21  which is the total amount paid in this state during the

22  taxable year or period by the taxpayer for compensation and

23  the denominator of which is the total compensation paid

24  everywhere during the taxable year or period.

25         (c)  The payroll factor fraction shall not include any

26  compensation paid to any employee located in this state when

27  it is certified to the Department of Revenue that such

28  compensation was paid to employees dedicated exclusively to

29  research and development activities performed pursuant to

30  sponsored research contracts conducted in conjunction with and

31  through a university that is a member of the State University


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  1  System or a nonpublic university that is chartered in Florida

  2  and conducts graduate programs at the professional or doctoral

  3  level. The Board of Regents must certify the contracts for

  4  members of the State University System and the president of

  5  the university must certify the contracts for a nonpublic

  6  university. As used in this paragraph, "sponsored research

  7  contract" means an agreement executed by parties that include

  8  at least the university and the taxpayer. Funding for

  9  sponsored research contracts may be provided from public or

10  private sources.

11         (8)  No research and development activities certified

12  as being conducted within this state in conjunction with and

13  through a university that is a member of the State University

14  System or a nonpublic university that is chartered in Florida

15  and conducts graduate programs at the professional or doctoral

16  level shall cause any corporation to become subject to the

17  taxes imposed by this chapter if the corporation would

18  otherwise not be subject to the tax levied under this chapter.

19  The property and payroll eliminated from the apportionment

20  formula pursuant to the provisions of paragraphs (2)(c) and

21  (4)(c) shall be eliminated only for the duration of the

22  contractual period specified in the contracts for the conduct

23  of the sponsored research. The reduction in tax due as a

24  result of the property and payroll eliminated from the

25  apportionment formula pursuant to the provisions of paragraphs

26  (2)(c) and (4)(c) shall not exceed the amount paid to the

27  university for the conduct of the sponsored research. No

28  sponsored research contracts in existence prior to July 1,

29  1998, shall be eligible to participate in the provisions of

30  paragraphs (2)(c) and (4)(c).

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  1         Section 2.  The Department of Revenue has authority to

  2  adopt rules pursuant to the Administrative Procedure Act to

  3  implement s. 220.15(2)(c), (4)(c), and (8), Florida Statutes,

  4  as created by this act. The Board of Regents and the president

  5  of each participating nonpublic university shall monitor the

  6  various sponsored research contracts and make a report to the

  7  Speaker of the House of Representatives and to the President

  8  of the Senate by February 1, 2000, which shall provide any

  9  necessary information which indicates if the provisions of

10  this act have been successful in attracting additional

11  sponsored research contracts.

12         Section 3.  This act shall take effect July 1 of the

13  year in which enacted.

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