Senate Bill 0172c1

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    Florida Senate - 1999                            CS for SB 172

    By the Committee on Fiscal Resource and Senators Horne and
    Grant




    314-877D-99

  1                      A bill to be entitled

  2         An act relating to taxation; amending ss.

  3         95.091, 193.063, 212.07, 212.11, 212.18,

  4         213.053, 215.26, F.S.; creating ss. 213.235,

  5         213.255, F.S.; amending certain statutes of

  6         limitations; reducing the period for tolling of

  7         the statute of limitations; prescribing

  8         circumstances for the tolling of the statute of

  9         limitations as a result of administrative or

10         judicial proceedings; providing for an

11         extension for filing tangible personal property

12         tax returns; providing for the annual issuance

13         of resale certificates to active accounts;

14         delaying the date for paying estimated taxes;

15         increasing the minimum threshold for requiring

16         payment of estimated taxes; authorizing the

17         Department of Revenue to disclose to a dealer

18         or taxpayer whether a specified certificate is

19         active, canceled, inactive, or invalid;

20         providing for periodic adjustment of the rate

21         of interest to be charged on certain tax

22         deficiencies; providing circumstances under

23         which the Department of Revenue is to pay

24         interest to the taxpayer; specifying when

25         applications for refunds must be filed;

26         directing the Department of Revenue to

27         establish a toll-free number for the

28         verification of valid registration numbers and

29         resale certificates; directing the Department

30         of Revenue to establish a system for receiving

31         information from dealers regarding certificate

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  1         numbers; directing the Department of Revenue to

  2         expand its dealer education program regarding

  3         the proper use of resale certificates;

  4         providing appropriations; providing an

  5         effective date.

  6

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

  8

  9         Section 1.  Subsections (3) and (4) of section 95.091,

10  Florida Statutes, are amended to read:

11         95.091  Limitation on actions to collect taxes.--

12         (3)(a)1.  With the exception of taxes levied under

13  chapter 198 and tax adjustments made pursuant to s. 220.23,

14  the Department of Revenue may determine and assess the amount

15  of any tax, penalty, or interest due under any tax enumerated

16  in s. 72.011 which it has authority to administer and the

17  Department of Business and Professional Regulation may

18  determine and assess the amount of any tax, penalty, or

19  interest due under any tax enumerated in s. 72.011 which it

20  has authority to administer:

21         a.  For taxes due before July 1, 1999, within 5 years

22  after the date the tax is due, any return with respect to the

23  tax is due, or such return is filed, whichever occurs later;

24  and for taxes due on or after July 1, 1999, within 3 years

25  after the date the tax is due, any return with respect to the

26  tax is due, or such return is filed, whichever occurs later;

27         b.  For taxes due before July 1, 1999, within 6 years

28  after the date the taxpayer either makes a substantial

29  underpayment of tax, or files a substantially incorrect

30  return;

31

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  1         c.  At any time while the right to a refund or credit

  2  of the tax is available to the taxpayer;

  3         d.  For taxes due before July 1, 1999, at any time

  4  after the taxpayer has filed a grossly false return;

  5         e.d.  At any time after the taxpayer has failed to make

  6  any required payment of the tax, has failed to file a required

  7  return, or has filed a grossly false or fraudulent return,

  8  except that for taxes due on or after July 1, 1999, the

  9  limitation prescribed in sub-subparagraph a. applies if the

10  taxpayer has disclosed in writing the tax liability to the

11  department before the department has contacted the taxpayer;

12  or

13         f.e.  In any case in which there has been a refund of

14  tax erroneously made for any reason:

15         (I)  For refunds made before July 1, 1999, within 5

16  years after making such refund; and

17         (II)  For refunds made on or after July 1, 1999, within

18  3 years after making such refund,

19

20  or at any time after making such refund if it appears that any

21  part of the refund was induced by fraud or the

22  misrepresentation of a material fact.

23         2.  For the purpose of this paragraph, a tax return

24  filed before the last day prescribed by law, including any

25  extension thereof, shall be deemed to have been filed on such

26  last day, and payments made prior to the last day prescribed

27  by law shall be deemed to have been paid on such last day.

28         (b)1.  The limitations in this subsection shall be

29  tolled for a period of 2 years with respect to audits in which

30  the notice of intent to conduct the audit was issued before

31  July 1, 1999, if the Department of Revenue has issued a notice

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  1  of intent to conduct an audit or investigation of the

  2  taxpayer's account within the applicable period of time as

  3  specified in this subsection.  The department shall commence

  4  an audit within 120 days after it issues a notice of intent to

  5  conduct an audit, unless the taxpayer requests a delay.  If

  6  the taxpayer does not request a delay and the department does

  7  not begin the audit within 120 days after issuing the notice,

  8  the tolling period shall terminate.

  9         2.  For audits in which the notice of intent to conduct

10  the audit was issued on or after July 1, 1999, the limitation

11  period shall be tolled for 1 year after issuing the notice. If

12  the taxpayer does not enter into an agreement to extend the

13  period pursuant to s. 213.23, the tolling period shall

14  terminate after 1 year.

15         (4)  If administrative or judicial proceedings for

16  review of the tax assessment or collection are initiated by a

17  taxpayer begun within the a period of limitation prescribed in

18  this section, the running of the period shall be tolled during

19  the pendency of the proceeding. Administrative proceedings

20  shall include taxpayer protest proceedings initiated under s.

21  213.21 and department rules.

22         Section 2.  Section 193.063, Florida Statutes, is

23  amended to read:

24         193.063  Extension of date for filing tangible personal

25  property tax returns.--The property appraiser shall grant an

26  extension for the filing of a tangible personal property tax

27  return for 30 days and may, at her or his discretion, grant an

28  additional extension for the filing of a tangible personal

29  property tax return for up to 15 additional 45 days. A request

30  for extension must be made in time for the property appraiser

31  to consider the request and act on it before the regular due

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  1  date of the return. However, a property appraiser may not

  2  require that a request for extension be made more than 10 days

  3  before the due date of the return. A request for extension, at

  4  the option of the property appraiser, shall must include the

  5  name of the taxable entity, the tax identification number of

  6  the taxable entity, and the reason a discretionary an

  7  extension should be granted.

  8         Section 3.  Effective February 1, 2000, paragraph (b)

  9  of subsection (1) of section 212.07, Florida Statutes, 1998

10  Supplement, is amended to read:

11         212.07  Sales, storage, use tax; tax added to purchase

12  price; dealer not to absorb; liability of purchasers who

13  cannot prove payment of the tax; penalties; general

14  exemptions.--

15         (1)

16         (b)  A resale must be in strict compliance with s.

17  212.18 and the rules and regulations, and any dealer who makes

18  a sale for resale which is not in strict compliance with s.

19  212.18 and the rules and regulations shall himself or herself

20  be liable for and pay the tax. A dealer who makes a sale for

21  resale shall document the exempt status of the transaction, as

22  established by rules adopted by the department, by retaining a

23  copy of the purchaser's resale certificate. In lieu of

24  maintaining a copy of the certificate, a dealer may document,

25  before the sale, an authorization number provided by the

26  department electronically or telephonically, or by other means

27  established by the department by rule. The department shall

28  adopt rules that provide that, for purchasers who continually

29  purchase on account from a dealer, the dealer may rely on a

30  resale certificate issued under s. 212.18(3)(c) which is valid

31  at the time of receipt from the purchaser, without seeking

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  1  annual verification of the resale certificate. A dealer may,

  2  through the informal protest provided for in s. 213.21 and the

  3  rules of the Department of Revenue, provide the department

  4  with evidence of the exempt status of a sale.  The Department

  5  of Revenue shall adopt rules which provide that valid resale

  6  certificates and Consumer certificates of exemption executed

  7  by those dealers or exempt entities that which were registered

  8  with the department at the time of sale, resale certificates

  9  provided by purchasers who were active dealers at the time of

10  sale, and verification by the department of a purchaser's

11  active dealer status at the time of sale in lieu of a resale

12  certificate shall be accepted by the department when submitted

13  during the protest period, but may not be accepted in any

14  proceeding under chapter 120 or any circuit court action

15  instituted under chapter 72.

16         Section 4.  Effective January 1, 2000, subsection (3)

17  of section 212.18, Florida Statutes, 1998 Supplement, is

18  amended to read:

19         212.18  Administration of law; registration of dealers;

20  rules.--

21         (3)(a)  Every person desiring to engage in or conduct

22  business in this state as a dealer, as defined in this

23  chapter, or to lease, rent, or let or grant licenses in living

24  quarters or sleeping or housekeeping accommodations in hotels,

25  apartment houses, roominghouses, or tourist or trailer camps

26  that are subject to tax under s. 212.03, or to lease, rent, or

27  let or grant licenses in real property, as defined in this

28  chapter, and every person who sells or receives anything of

29  value by way of admissions, must file with the department an

30  application for a certificate of registration for each place

31  of business, showing the names of the persons who have

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  1  interests in such business and their residences, the address

  2  of the business, and such other data as the department may

  3  reasonably require. However, owners and operators of vending

  4  machines or newspaper rack machines are required to obtain

  5  only one certificate of registration for each county in which

  6  such machines are located. The department, by rule, may

  7  authorize a dealer that uses independent sellers to sell its

  8  merchandise to remit tax on the retail sales price charged to

  9  the ultimate consumer in lieu of having the independent seller

10  register as a dealer and remit the tax. The department may

11  appoint the county tax collector as the department's agent to

12  accept applications for registrations. The application must be

13  made to the department before the person, firm, copartnership,

14  or corporation may engage in such business, and it must be

15  accompanied by a registration fee of $5. However, a

16  registration fee is not required to accompany an application

17  to engage in or conduct business to make mail order sales.

18         (b)  The department, upon receipt of such application,

19  will grant to the applicant a separate certificate of

20  registration for each place of business, which certificate may

21  be canceled by the department or its designated assistants for

22  any failure by the certificateholder to comply with any of the

23  provisions of this chapter. The certificate is not assignable

24  and is valid only for the person, firm, copartnership, or

25  corporation to which issued. The certificate must be placed in

26  a conspicuous place in the business or businesses for which it

27  is issued and must be displayed at all times. Except as

28  provided in this subsection paragraph, no person shall engage

29  in business as a dealer or in leasing, renting, or letting of

30  or granting licenses in living quarters or sleeping or

31  housekeeping accommodations in hotels, apartment houses,

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  1  roominghouses, tourist or trailer camps, or real property as

  2  hereinbefore defined, nor shall any person sell or receive

  3  anything of value by way of admissions, without first having

  4  obtained such a certificate or after such certificate has been

  5  canceled; no person shall receive any license from any

  6  authority within the state to engage in any such business

  7  without first having obtained such a certificate or after such

  8  certificate has been canceled. The engaging in the business of

  9  selling or leasing tangible personal property or services or

10  as a dealer, as defined in this chapter, or the engaging in

11  leasing, renting, or letting of or granting licenses in living

12  quarters or sleeping or housekeeping accommodations in hotels,

13  apartment houses, roominghouses, or tourist or trailer camps

14  that are taxable under this chapter, or real property, or the

15  engaging in the business of selling or receiving anything of

16  value by way of admissions, without such certificate first

17  being obtained or after such certificate has been canceled by

18  the department, is prohibited. The failure or refusal of any

19  person, firm, copartnership, or corporation to so qualify when

20  required hereunder is a misdemeanor of the first degree,

21  punishable as provided in s. 775.082 or s. 775.083, or subject

22  to injunctive proceedings as provided by law. Such failure or

23  refusal also subjects the offender to a $100 initial

24  registration fee in lieu of the $5 registration fee authorized

25  in this paragraph (a).  However, the department may waive the

26  increase in the registration fee if it is determined by the

27  department that the failure to register was due to reasonable

28  cause and not to willful negligence, willful neglect, or

29  fraud.

30         (c)  In addition to the certificate of registration,

31  the department shall provide to each newly registered dealer

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  1  an initial resale certificate that is valid for the remainder

  2  of the period of issuance. The department shall provide each

  3  active dealer with an annual resale certificate. As used in

  4  this section, the term "active dealer" means a person who is

  5  currently registered with the department and who complies with

  6  the requirement to file at least once during each applicable

  7  reporting period.

  8         (d)(b)  The department may revoke any dealer's

  9  certificate of registration when the dealer fails to comply

10  with this chapter. Prior to revocation of a dealer's

11  certificate of registration, the department must schedule an

12  informal conference at which the dealer may present evidence

13  regarding the department's intended revocation or enter into a

14  compliance agreement with the department. The department must

15  notify the dealer of its intended action and the time, place,

16  and date of the scheduled informal conference by written

17  notification sent by United States mail to the dealer's last

18  known address of record furnished by the dealer on a form

19  prescribed by the department. The dealer is required to attend

20  the informal conference and present evidence refuting the

21  department's intended revocation or enter into a compliance

22  agreement with the department which resolves the dealer's

23  failure to comply with this chapter. The department shall

24  issue an administrative complaint under s. 120.60 if the

25  dealer fails to attend the department's informal conference,

26  fails to enter into a compliance agreement with the department

27  resolving the dealer's noncompliance with this chapter, or

28  fails to comply with the executed compliance agreement.

29         (e)(c)  As used in this paragraph, the term "exhibitor"

30  means a person who enters into an agreement authorizing the

31  display of tangible personal property or services at a

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  1  convention or a trade show.  The following provisions apply to

  2  the registration of exhibitors as dealers under this chapter:

  3         1.  An exhibitor whose agreement prohibits the sale of

  4  tangible personal property or services subject to the tax

  5  imposed in this chapter is not required to register as a

  6  dealer.

  7         2.  An exhibitor whose agreement provides for the sale

  8  at wholesale only of tangible personal property or services

  9  subject to the tax imposed in this chapter must obtain a

10  resale certificate from the purchasing dealer but is not

11  required to register as a dealer.

12         3.  An exhibitor whose agreement authorizes the retail

13  sale of tangible personal property or services subject to the

14  tax imposed in this chapter must register as a dealer and

15  collect the tax imposed under this chapter on such sales.

16         4.  Any exhibitor who makes a mail order sale pursuant

17  to s. 212.0596 must register as a dealer.

18

19  Any person who conducts a convention or a trade show must make

20  their exhibitor's agreements available to the department for

21  inspection and copying.

22         Section 5.  Effective January 1, 2000, paragraphs (b),

23  (e), and (f) of subsection (1), and paragraphs (a), (b), (c),

24  and (d) of subsection (4) of section 212.11, Florida Statutes,

25  1998 Supplement, are amended to read:

26         212.11  Tax returns and regulations.--

27         (1)

28         (b)  For the purpose of ascertaining the amount of tax

29  payable under this chapter, it shall be the duty of all

30  dealers to file a return and remit the tax, on or before the

31  20th day of the month, or on or before the 28th day of the

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  1  month if the dealer is required to file an estimated tax as

  2  provided in subsection (4), to the department, upon forms

  3  prepared and furnished by it or in a format prescribed by it.

  4  Such return must show the rentals, admissions, gross sales, or

  5  purchases, as the case may be, arising from all leases,

  6  rentals, admissions, sales, or purchases taxable under this

  7  chapter during the preceding calendar month.

  8         (e)  The department shall accept returns, except those

  9  required to be initiated through an electronic data

10  interchange, as timely if postmarked on or before the 20th day

11  of the month, or on or before the 28th day of the month if the

12  dealer is required to file an estimated tax as provided in

13  subsection (4); if the filing date if the 20th day falls on a

14  Saturday, Sunday, or federal or state legal holiday, returns

15  shall be accepted as timely if postmarked on the next

16  succeeding workday.  Any dealer who operates two or more

17  places of business for which returns are required to be filed

18  with the department and maintains records for such places of

19  business in a central office or place shall have the privilege

20  on each reporting date of filing a consolidated return for all

21  such places of business in lieu of separate returns for each

22  such place of business; however, such consolidated returns

23  must clearly indicate the amounts collected within each county

24  of the state. Any dealer who files a consolidated return shall

25  calculate his or her estimated tax liability for each county

26  by the same method the dealer uses to calculate his or her

27  estimated tax liability on the consolidated return as a whole.

28  Each dealer shall file a return for each tax period even

29  though no tax is due for such period.

30         (f)1.  A taxpayer who is required to remit taxes by

31  electronic funds transfer shall make a return in a manner that

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  1  is initiated through an electronic data interchange.  The

  2  acceptable method of transfer, the method, form, and content

  3  of the electronic data interchange, giving due regard to

  4  developing uniform standards for formats as adopted by the

  5  American National Standards Institute, the circumstances under

  6  which an electronic data interchange shall serve as a

  7  substitute for the filing of another form of return, and the

  8  means, if any, by which taxpayers will be provided with

  9  acknowledgments, shall be as prescribed by the department. The

10  department must accept such returns as timely if initiated and

11  accepted on or before the 20th day of the month, or on or

12  before the 28th day of the month if the dealer is required to

13  file an estimated tax as provided in subsection (4). If the

14  filing date 20th day falls on a Saturday, Sunday, or federal

15  or state legal holiday, returns must be accepted as timely if

16  initiated and accepted on the next succeeding workday.

17         2.  The department may waive the requirement to make a

18  return through an electronic data interchange due to problems

19  arising from the taxpayer's computer capabilities, data

20  systems changes, and taxpayer operating procedures.  To obtain

21  a waiver, the taxpayer shall demonstrate in writing to the

22  department that such circumstances exist.

23         (4)(a)  Each dealer who is subject to the tax imposed

24  by this chapter and who paid such tax for the preceding state

25  fiscal year in an amount greater than or equal to $200,000

26  $100,000 shall calculate the amount of estimated tax due

27  pursuant to this section for any month as provided in

28  paragraph (1)(a).

29         (b)  The amount of any estimated tax shall be due,

30  payable, and remitted by electronic funds transfer by the 28th

31  20th day of the month for which it is estimated.  The

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  1  difference between the amount of estimated tax paid and the

  2  actual amount of tax due under this chapter for such month

  3  shall be due and payable by the first day of the following

  4  month and remitted by electronic funds transfer by the 28th

  5  20th day thereof.

  6         (c)  Any dealer who is eligible to file a consolidated

  7  return and who paid the tax imposed by this chapter for the

  8  immediately preceding state fiscal year in an amount greater

  9  than or equal to $200,000 $100,000 or would have paid the tax

10  in such amount if he or she had filed a consolidated return

11  shall be subject to the provisions of this subsection

12  notwithstanding an election by the dealer in any month to file

13  a separate return.

14         (d)  A dealer engaged in the business of selling boats,

15  motor vehicles, or aircraft who made at least one sale of a

16  boat, motor vehicle, or aircraft with a sales price of

17  $200,000 $100,000 or greater in the previous state fiscal year

18  may qualify for payment of estimated sales tax pursuant to the

19  provisions of this paragraph.  To qualify, a dealer must apply

20  annually to the department prior to October 1, and, if

21  qualified, the department must grant the application for

22  payment of estimated sales tax pursuant to this paragraph for

23  the following calendar year.  In lieu of the method for

24  calculating estimated sales tax liability pursuant to

25  subparagraph (1)(a)3., a qualified dealer must calculate that

26  option as 66 percent of the average tax liability pursuant to

27  this chapter for all sales excluding the sale of each boat,

28  motor vehicle, or aircraft with a sales price of $200,000

29  $100,000 or greater during the state fiscal year ending the

30  year in which the application is made.  A qualified dealer

31  must also remit the sales tax for each sale of a boat, motor

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  1  vehicle, or aircraft with a sales price of $200,000 $100,000

  2  or greater by either electronic funds transfer on the date of

  3  the sale or on a form prescribed by the department and

  4  postmarked on the date of the sale.

  5         Section 6.  Effective January 1, 2000, subsection (10)

  6  of section 213.053, Florida Statutes, 1998 Supplement, is

  7  amended to read:

  8         213.053  Confidentiality and information sharing.--

  9         (10)  Notwithstanding any other provision of this

10  section, with respect to a request for verification of a

11  certificate of registration issued pursuant to s. 212.18 to a

12  specified dealer or taxpayer or with respect to a request by a

13  law enforcement officer for verification of a certificate of

14  registration issued pursuant to s. 538.09 to a specified

15  secondhand dealer or pursuant to s. 538.25 to a specified

16  secondary metals recycler, the department may disclose whether

17  the specified person holds a valid certificate or whether a

18  specified certificate number is valid, canceled, inactive, or

19  invalid and the name of the holder of the such certificate.

20  This subsection shall not be construed to create a duty to

21  request verification of any certificate of registration.

22         Section 7.  Section 213.235, Florida Statutes, is

23  created to read:

24         213.235  Determination of interest on deficiencies.--

25         (1)  Notwithstanding any other provision of law, the

26  annual rate of interest applicable to tax payment deficiencies

27  that arise on or after July 1, 1999, shall be the adjusted

28  rate established by the executive director of the department

29  under subsection (2), unless a lower rate for the particular

30  tax is specifically provided for in law, in which case the

31

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  1  lower rate applies. This annual rate of interest applies to

  2  all taxes enumerated in s. 213.05.

  3         (2)  If the adjusted prime rate charged by banks,

  4  rounded to the nearest full percent, during either:

  5         (a)  The 6-month period ending on September 30 of any

  6  calendar year, or

  7         (b)  The 6-month period ending on March 31 of any

  8  calendar year

  9

10  differs from the interest rate in effect on such date, the

11  executive director of the department shall, within 20 days,

12  establish an adjusted rate of interest equal to such adjusted

13  prime rate.

14         (3)  An adjusted rate of interest established under

15  this section becomes effective:

16         (a)  On January 1 of the succeeding year, if based upon

17  the adjusted prime rate for the 6-month period ending on

18  September 30; or

19         (b)  On July 1 of the same calendar year, if based upon

20  the adjusted prime rate for the 6-month period ending on March

21  31.

22         (4)  As used in this section, the term "adjusted prime

23  rate charged by banks" means the average predominant prime

24  rate quoted by commercial banks to large businesses, as

25  determined by the Board of Governors of the Federal Reserve

26  System.

27         (5)  Once established, an adjusted rate of interest

28  remains in effect until further adjusted under subsection (2).

29         Section 8.  Section 213.255, Florida Statutes, is

30  created to read:

31

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  1         213.255  Interest.--Interest shall be paid on

  2  overpayments of taxes, payment of taxes not due, or taxes paid

  3  in error, subject to the following conditions:

  4         (1)  A refund application must be filed with the

  5  department within the time specified by s. 215.26.

  6         (2)  A refund application may not be processed until it

  7  is complete. A refund application is complete if it is filed

  8  on a permitted form and contains:

  9         (a)  The taxpayer's name, address, identifying numbers,

10  and signature;

11         (b)  Sufficient information, whether on the application

12  or attachments, to permit mathematical verification of the

13  amount of the refund;

14         (c)  The amount claimed;

15         (d)  The specific grounds upon which the refund is

16  claimed;

17         (e)  The taxable years or periods involved; and

18         (f)  A completed audit, if an audit is required by the

19  department.

20         (3)  If the refund application is not complete, the

21  department shall notify the taxpayer of the inadequacy and

22  instruct the applicant of what is needed to complete the

23  application.

24         (4)  Interest shall not begin to accrue until 90 days

25  after a complete refund application has been filed and the

26  amount of overpayment has not been refunded to the taxpayer or

27  applied as a credit to the taxpayer's account. If the

28  department and the taxpayer mutually agree that an audit of

29  the claim is necessary, interest shall not begin to accrue

30  until the audit of the claim is final or until 90 days after

31

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  1  the date the complete refund application has been filed,

  2  whichever is later.

  3         (5)  If a tax is adjudicated unconstitutional and

  4  refunds are ordered by the court, interest shall not commence

  5  on complete applications until 90 days after the adjudication

  6  becomes final and unappealable or 90 days after a complete

  7  application has been filed, whichever is later.

  8         (6)  Interest shall be paid until a date determined by

  9  the department which must be no earlier than 7 days before the

10  date on which the Comptroller issues the refund warrant.

11         (7)  Interest shall not be paid if the department has

12  reasonable cause to believe that it could not recover the

13  amount of any refund paid in error from the person claiming

14  the refund, unless the person files a cash bond or a surety

15  bond in the amount of the refund claimed or the person makes

16  other security arrangements satisfactory to the department.

17  The cash or surety bond must be endorsed by the surety company

18  authorized to do business in this state and must be

19  conditioned upon payment in full of the amount of any refund

20  paid in error for any reason. The department shall provide

21  written notice of its determination that a cash or surety bond

22  is required, in which event interest shall not commence until

23  the person filing the claim satisfies this requirement.

24         (8)  The rate of interest shall be the adjusted rate

25  established under s. 213.235. This annual rate of interest

26  shall be applied to all refunds of taxes administered by the

27  department.

28         (9)  Interest that is paid pursuant to this section

29  shall be paid proportionately from the funds or sources into

30  which the tax that is refunded was or should have been

31  disbursed or distributed after the tax was collected.

                                  17

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  1         (10)  This section applies to eligible refunds based on

  2  tax payments made on or after July 1, 1999.

  3         Section 9.  Subsection (2) of section 215.26, Florida

  4  Statutes, is amended to read:

  5         215.26  Repayment of funds paid into State Treasury

  6  through error.--

  7         (2)  Application for refunds as provided by this

  8  section must be filed with the Comptroller, except as

  9  otherwise provided in this subsection, within 3 years after

10  the right to the refund has accrued or else the right is

11  barred. Except as provided in chapter 198 and s. 220.23, an

12  application for a refund of a tax enumerated in s. 72.011,

13  which tax was paid after September 30, 1994, and before July

14  1, 1999, must be filed with the Comptroller within 5 years

15  after the date the tax is paid, and within 3 years after the

16  date the tax was paid for taxes paid on or after July 1, 1999.

17  The Comptroller may delegate the authority to accept an

18  application for refund to any state agency, or the judicial

19  branch, vested by law with the responsibility for the

20  collection of any tax, license, or account due. The

21  application for refund must be on a form approved by the

22  Comptroller and must be supplemented with additional proof the

23  Comptroller deems necessary to establish the claim; provided,

24  the claim is not otherwise barred under the laws of this

25  state. Upon receipt of an application for refund, the judicial

26  branch or the state agency to which the funds were paid shall

27  make a determination of the amount due. If an application for

28  refund is denied, in whole or in part, the judicial branch or

29  such state agency shall notify the applicant stating the

30  reasons therefor. Upon approval of an application for refund,

31  the judicial branch or such state agency shall furnish the

                                  18

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  1  Comptroller with a properly executed voucher authorizing

  2  payment.

  3         Section 10.  Effective January 1, 2000, the Department

  4  of Revenue shall establish a toll-free number for the

  5  verification of valid registration numbers and resale

  6  certificates. The system must be adequate to guarantee a low

  7  busy rate, must respond to keypad inquiries, and must provide

  8  data that is updated daily.

  9         Section 11.  The Department of Revenue shall establish

10  a system, effective January 1, 2000, for receiving information

11  from dealers regarding certificate numbers of those who are

12  seeking to make purchases for resale. The department must

13  provide such dealers, free of charge, with verification of

14  those numbers that are canceled or invalid.

15         Section 12.  Effective July 1, 1999, the Department of

16  Revenue shall expand its dealer education program regarding

17  the proper use of resale certificates. The expansion must

18  include, but need not be limited to, revision of the

19  registration application for clarity, development of

20  industry-specific brochures, development of a media campaign

21  to heighten awareness of resale fraud and its consequences,

22  outreach to business and professional organizations, and

23  creation of seminars and continuing-education programs for

24  taxpayers and licensed professionals.

25         Section 13.  (1)  There is appropriated from the

26  General Revenue Fund to the Department of Revenue in fiscal

27  year 1999-2000, to be used in implementing the changes to the

28  resale certificate and related provisions of this act:

29         (2)  One and one-half full-time-equivalent positions

30  and the sum of $211,065 to be used for salaries, benefits, and

31  expenses; and

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  1         (3)  The sum of $23,455 to be used for operating

  2  capital outlay.

  3         Section 14.  Except as otherwise expressly provided in

  4  this act, this act shall take effect July 1, 1999.

  5

  6

  7

  8

  9

10

11

12

13

14

15

16

17

18

19

20

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  1          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
  2                              SB 172

  3

  4  CS for SB 172 differs significantly from SB 172. A
    section-by-section description of SB 172 is provided, and the
  5  treatment of each issue in CS/SB 172 is described.

  6  Section 1. Present Situation: Section 95.091, F.S., provides
    that the Department of Revenue may take action to collect
  7  taxes within 5 years after the date the tax is due or any
    return with respect to the tax is due, or such return is
  8  filed. If a taxpayer makes a substantial underpayment of tax
    this period is extended to 6 years. In cases of grossly false
  9  or fraudulent returns, there is no limit of the period for
    action to collect. The statute of limitation is tolled for 2
10  years if the Department of Revenue has issued a notice of
    intent to audit or investigate. The statute of limitation is
11  also tolled during any administrative or judicial review of a
    tax assessment.
12
    Proposed Change--SB 172: For taxes due on or after July 1,
13  1999, the statute of limitations is reduced to 3 years. There
    is no limit on actions to collect taxes in cases of failure to
14  make required tax payments, failure to file a required return,
    or filing a fraudulent return, but for taxes due on or after
15  July 1, 1999, the 3-year limit applied if the taxpayer has
    disclosed in writing the tax liability before the department
16  has given the taxpayer notice of that liability. Tolling of
    the statute of limitation is not available for taxes due on or
17  after July 1, 1999 unless the taxpayer has initiated an
    administrative or judicial proceeding. No additional penalty
18  or interest may be imposed after the statute of limitations
    has expired except for the period during which the tax
19  liability is the subject of a circuit court proceeding under
    chapter 72.
20
    CS/SB 172 amends s. 95.091, F.S., relating to statutes of
21  limitation on actions to collect taxes, to provide that for
    taxes due on or after July 1, 1999, there shall be a
22  three-year statute of limitations on the ability of the
    Department of Revenue to assess an amount of taxes, penalty,
23  or interest due, with limited exceptions.

24  -     The department could make such an assessment at any time
          after the taxpayer failed to make any required payment
25        of the tax, failed to file a required return, or filed a
          fraudulent return. If, however, the taxpayer has
26        disclosed the tax liability in writing to the department
          before the department gives the taxpayer notice of the
27        liability, then the three-year period would apply.

28  -     The department could make such an assessment at any time
          after making a refund of tax if it appears that any part
29        of the refund was induced by fraud or misrepresentation,
          otherwise the statute of limitations on refunds made in
30        error is five years for taxes due before July 1, 1998,
          and three years for taxes due on or after July 1, 1999.
31
    The current statutory exceptions to the general five-year
                                  21

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  1  statute of limitations shall continue to apply to taxes due
    before July 1, 1999.
  2
    The bill also revises the conditions under which the
  3  limitations period shall be tolled. The measure specifies that
    the current statutory authority to toll the limitations period
  4  when the department issues a notice of intent to audit shall
    apply solely to taxes due before July 1, 1999, after which the
  5  tolling period shall be one year. In addition, the amendment
    specifies that the tolling of the limitations period during an
  6  administrative or judicial proceeding for review of the tax
    assessment shall apply solely when such review is initiated by
  7  a taxpayer. When the limitations period is tolled during such
    a review proceeding, no additional interest or penalty may be
  8  imposed for the tax liability after the expiration of the time
    limitation prescribed in the statute, except for the period
  9  during which the liability is the subject of a proceeding
    under ch. 72, F.S.
10
    Section 2. Present Situation: Section 193.062, F.S., provides
11  an April 1 filing date for ad valorem tax returns unless
    otherwise specified in general law.
12
    Proposed Change--SB 172: The filing date is changed to April
13  15.

14  This issue is not addressed in CS/SB 172.

15  Section 3. Present Situation: Section 193.063, F.S., provides
    for a 45 day extension for filing tangible personal property
16  tax returns.

17  Proposed Changes--SB 172: The extension period is increased to
    6 months, and provision is made for a request for extension to
18  be signed by the taxpayer, a tax preparer, or an individual
    authorized by the taxable entity.
19
    Proposed Change--CS/SB 172: This bill amends s. 193.063,
20  Florida Statutes, to require the property appraiser to grant a
    30 day extension for filing tangible personal property tax
21  returns, and allows the property appraiser to grant an
    additional 15 day extension.
22
    Section 4. Present Situation: Section 194.192, F.S., provides
23  for interest of 12 percent per year to be levied on delinquent
    ad valorem taxes in any suit involving the assessment or
24  collection of taxes.

25  Proposed Change--SB 172: This bill provides that interest on
    delinquent taxes be at the rate determined under s. 220.807,
26  F.S. It also provides that court ordered tax refunds must
    include an interest payment at 1 percent lower than rate
27  determined under s. 220.807, F.S. from the date the refund is
    ordered until it is paid in full.
28
    This issue is not addressed in CS/SB 172.
29
    Section 5. Present Situation: Section 197.172, F.S., provides
30  for interest of 18 percent per year to be levied on delinquent
    personal property taxes.
31
    Proposed Change--SB 172: This bill provides that interest on
                                  22

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  1  delinquent personal property taxes be at the rate determined
    under s. 220.807, F.S. It also provides that refunds of
  2  overpayments must include an interest payment at 1 percent
    lower than rate determined under s. 220.807, F.S. from the
  3  date the refund is ordered until it is paid in full.

  4  This issue is not addressed in CS/SB 172.

  5  Section 6. Present Situation: Section 199.032, F.S., imposes a
    2 mill tax on all intangible personal property which has
  6  taxable situs in this state. Section 199.023, F.S., defines
    intangible personal property to include all notes, bonds, and
  7  other obligations for the payment of money.

  8  Proposed Change--SB 172: This bill provides a maximum
    intangibles tax of $1,000 on any nonsecured loan.
  9
    This issue is not addressed in CS/SB 172.
10
    Section 7. Present Situation: Section 199.185, F.S., provides
11  a list of assets which are exempt from the annual and
    nonrecurring tax on intangibles. Natural persons are entitled
12  to exemptions of $20,000 per individual and $40,000 per
    married couple against the first mill of the tax, and $100,000
13  per individual and $200,000 per married couple for the second
    mill.
14
    Proposed Change--SB 172: "Money equivalent held by a bank,
15  savings and loan association, investment and securities
    company, or other financial institution," is  added to the
16  list of exempt assets. The exemptions for natural persons are
    increased to $100,000 for individuals and $200,000 per couple
17  against both mills, and non-natural entitles are also given a
    $100,000 exemption.
18
    This issue is not addressed in CS/SB 172.
19
    Section 8. Present Situation: Section 199.062, F.S., provides
20  for annual tax information reports to be filed by corporations
    and security dealers and investment advisers. Corporations
21  must provide information to their stockholders on or before
    April 1 concerning the value of its stock, and must file a
22  copy of this report with the Department of Revenue by June 30.
    On or before June 30 of each year, all security dealers and
23  investment advisers must file with the department a position
    statement as of December 31 for each customer whose mailing
24  address is in Florida.

25  Proposed Change--SB 172: The report which corporations must
    provide to their stockholders can be delayed up to 45 days,
26  upon request of the corporation and for good cause shown. The
    report that a corporation files with the department is not due
27  until 90 days after it is provided to stockholders. Security
    dealers and investment advisers can delay filing position
28  statements up to 45 days if they request an extension at least
    14 days before the report is due and show good cause.
29
    This issue is not addressed in CS/SB 172.
30
    Section 9. Present Situation: Section 199.057, F.S. allows
31  corporations to elect of pay the annual tax on any class of
    its stock, as agent for its Florida stockholders. If a
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  1  corporation elects to do this, it must file a written notice
    with the department before June30 of the year for which the
  2  election is made. It must notify its stockholders by April 1
    that an election is being made.
  3
    Proposed Change--SB 172: This bill changes the notification
  4  dates for the election to pay stockholders' intangibles tax.
    The date to notify both the department and stockholders is
  5  moved to April 15, but a 45 day extension for notifying
    stockholders is allowed if the corporation requests and shows
  6  good cause therefor. The corporation has 90 days after it
    notifies its stockholders to file with the department.
  7
    This issue is not addressed in CS/SB 172.
  8
    Section 10. Present Situation: Section 199.282, F.S., provides
  9  for interest on unpaid intangibles tax of 12 percent per year.
    It also provides for a penalty of 10 percent per month, up
10  to50 percent, for delinquent taxes. A specific penalty of 30
    percent is imposed if a return is filed and property is
11  omitted or undervalued.

12  Proposed Change--SB 172: This bill amends this section to
    provide that the interest rate on delinquent intangibles tax
13  is at the rate determined under s. 220.807, F.S. It reduces
    penalties by 50 percent, and provides that no penalty is
14  imposed upon a showing of reasonable cause for failure to pay
    the tax. It also provides that a person is exempt from a
15  delinquency penalty if payment of the penalty would cause or
    exacerbate financial hardship. The penalty for undervaluation
16  or omission may be waived upon showing that there was
    reasonable cause for the undervaluation or omission.
17
    CS/SB 172 creates s. 213.235, F.S., providing for the payment
18  of an adjusted rate of interest on tax deficiencies that arise
    on or after July 1, 1999. The amendment specifies, however,
19  that if a lower rate of interest for the tax is specifically
    provided for in law, the lower rate shall apply. The adjusted
20  rate of interest is based upon the adjusted prime rate charged
    by banks. The adjusted rate of interest is applicable to taxes
21  enumerated in s. 213.05, F.S. Penalties on delinquent taxes
    are not addressed in this bill.
22
    Section 11. Present Situation: Section 199.232, F.S., provides
23  that the Department of Revenue shall credit or refund any
    overpayment of tax that is revealed on an audit or for which a
24  claim for refund is filed. The department is also authorized
    to refund overpayments discovered upon investigation of an
25  intangibles tax return, whether or not the taxpayer files a
    claim for refund. There is no provision for payment of
26  interest upon refunds.

27  Proposed Change--SB 172: Section 199.2825, F.S., is created to
    provide that the department must refund any overpayment of tax
28  within 60 days after the tax was due or paid, whichever comes
    later. Interest must be paid on refunds later than 60 days
29  after the tax was due or paid at a rate 1 percent lower than
    the rate determined under s. 220.807, F.S.
30
    CS/SB 172 creates s. 213.255, F.S., providing for the payment
31  of interest on overpayments of taxes, payment of taxes not
    due, or taxes paid in error. The amendment specifies that this
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  1  provision applies to eligible refunds based on tax payments
    made on or after July 1, 1999. The interest rate is the
  2  adjusted rate established under s. 213.235, F.S.

  3  Under the measure, interest does not commence until 90 days
    after a completed application is filed with the department and
  4  the amount of overpayment has not been refunded or applied as
    a credit. In the event of a court-ordered refund based upon
  5  the unconstitutionality of a tax, interest shall not commence
    until 90 days after the adjudication becomes final and
  6  unappealable or 90 days after a complete application is filed,
    whichever is later. If the department has reasonable cause to
  7  believe that it could not recover a refund paid in error from
    the person claiming the refund, no interest shall be required
  8  unless the person files a cash bond or a surety bond or makes
    other security arrangements.
  9
    Section 12. Present Situation: Part III of chapter 199, F.S.,
10  provides that the Department of Revenue shall administer and
    enforce the assessment and collection of taxes, penalties and
11  interest imposed by this chapter. It has the authority to
    audit taxpayers, and may assess any tax deficiency with or
12  without an audit. Tax liability lies with taxpayers who either
    own or control taxable assets.
13
    Proposed Change--SB 172: Section 199.252, F.S., is created to
14  provide for assessment of property for back taxes. It provides
    that if intangible personal property appears to have escaped
15  taxation, the authorized officers shall make the assessment of
    taxes upon the property in addition to the assessment for the
16  current year. This back assessment is limited to 2 years, but
    attaches to the property, not to the taxpayer, so that a
17  taxpayer could potentially be liable for back taxes on an
    intangible asset which they did not own at the time for which
18  the tax is assessed.

19  CS/SB 172 does not address this issue.

20  Section 13. Present Situation: Section 201.16, F.S., provides
    that all revenue laws relating to the assessment and
21  collection of taxes are extended to the collection of
    documentary stamp taxes.
22
    Proposed Change--SB 172: This section is amended to provide
23  for taxation of documents that escaped taxation for a period
    of no more than 2 years. The taxation shall be at the rate
24  that prevailed in the year that the document escaped taxation.

25  This issue is not addressed in CS/SB 172.

26  Section 14. Present Situation: Section 201.17, F.S., imposes a
    penalty upon delinquent documentary stamp taxes of 10 percent
27  per month, up to 50 percent of any unpaid tax. Interest is
    imposed upon unpaid taxes at a rate of 1 percent per month.
28
    Proposed Change--SB 172: This section is amended to reduce
29  penalties to 5 percent a month, up to 25 percent of any unpaid
    tax. The interest rate for unpaid taxes is set at the rate
30  determined under s. 220.807. Upon a showing of reasonable
    cause for not timely paying the tax, a person is exempt from
31  penalties.

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  1  CS/SB 172 creates s. 213.235, F.S., providing for the payment
    of an adjusted rate of interest on tax deficiencies that arise
  2  on or after July 1, 1999. The amendment specifies, however,
    that if a lower rate of interest for the tax is specifically
  3  provided for in law, the lower rate shall apply. The adjusted
    rate of interest is based upon the adjusted prime rate charged
  4  by banks. The adjusted rate of interest is applicable to taxes
    enumerated in s. 213.05, F.S. Penalties on delinquent taxes
  5  are not addressed in this bill.

  6  Section 15. Present Situation: Section 205.053 provides
    penalties for failure to pay occupational license taxes.
  7  Failure to renew and pay for an occupational license results
    in a penalty of 10 percent for the month of October, the month
  8  after the license expires, and 5 percent for each subsequent
    month until the delinquency is paid. The total penalty is
  9  capped at 25 percent of the license tax. Any person who
    engages in or manages a business without first obtaining a
10  required local occupational license is subject to a penalty of
    25 percent of the license. Any person who engages in any
11  business, occupation, or profession who does not pay the
    required occupational license tax within 150 days after the
12  initial notice of tax due is subject to civil actions and
    penalties, and a penalty up to $250.
13
    Proposed Change--SB 172: The bill reduces the penalty for
14  failure to renew an occupational license to 5 percent per
    month of delinquency. It provides that the penalty for failure
15  to obtain a required occupational license is 5 percent per
    month, not to exceed 25 percent. It provides that civil
16  penalties do not become applicable until 6 months after the
    initial notice of tax due. It further provides that in order
17  to impose a local occupational license tax for a license that
    was required to be obtained or renewed in any year preceding
18  the current year, but was not obtained or renewed, the
    appropriate tax collector must have discovered the failure to
19  pay the required tax and must have given notice of delinquency
    to the licensee within 2 years after the date on which the
20  license should have been obtained or renewed. This provision
    appears to create a situation where, if a person engaged in a
21  business, occupation, or profession which would normally
    require an occupational license evades notice of the tax
22  collector for 2 years, that person cannot be required to
    obtain a license.
23
    This issue is not addressed in CS/SB 172.
24
    Section 16. Present Situation: Section 212.12, F.S., provides
25  penalties for noncompliance with sales and use tax laws. It
    provides a penalty of 10 percent per 30 days for unpaid taxes
26  or failure to timely file a tax return. The total penalty may
    not exceed 50 percent of the unpaid tax.
27
    Proposed Change--SB 172: This section is amended to reduce the
28  applicable penalty to 5 percent, with a maximum of 25 percent.
    It also provides that there is no penalty for failure to file
29  a tax return if there is no tax owed. Upon a showing of
    reasonable cause for not timely paying the tax, a person is
30  exempt from penalties and interest. The person or entity must
    promptly make the return and pay the delinquent taxes as soon
31  as the reasonable cause no longer applies.

                                  26

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  1  This issue is not addressed in CS/SB 172.

  2  Section 17. Present Situation: Section 215.26, F.S., provides
    general procedures by which overpayments of taxes or taxes
  3  paid in error may be refunded by the Comptroller. There is no
    provision for the payment of interest on refunds.
  4
    Proposed Change--SB 172: The bill creates s. 212.125, F.S.,
  5  which provides that if a taxpayer pays more than the amount
    owed for taxes imposed under chapter 212, the department must
  6  refund the overpayment within 60 days after the tax was due or
    paid, whichever occurred later. Interest at the rate of 1
  7  percent less than the rate determined under s. 220.807 must be
    paid on the balance due the taxpayer from 60 days after the
  8  tax was due or paid until the refund is paid in full.

  9  CS/SB 172 creates s. 213.255, F.S., providing for the payment
    of interest on overpayments of taxes, payment of taxes not
10  due, or taxes paid in error. The amendment specifies that this
    provision applies to eligible refunds based on tax payments
11  made on or after July 1, 1999. The interest rate is the
    adjusted rate established under s. 213.235, F.S.
12
    Under the measure, interest does not commence until 90 days
13  after a completed application is filed with the department and
    the amount of over payment has not been refunded or applied as
14  a credit. In the event of a court-ordered refund based upon
    the unconstitutionality of a tax, interest shall not commence
15  until 90 days after the adjudication becomes final and
    unappealable or 90 days after a complete application is filed,
16  whichever is later. If the department has reasonable cause to
    believe that it could not recover a refund paid in error from
17  the person claiming the refund, no interest shall be required
    unless the person files a cash bond or a surety bond or makes
18  other security arrangements.

19  Section 18. Present Situation: Section 220.231 provides that
    an additional penalty is imposed for incomplete corporate
20  income tax returns of $300 or 10 percent of the tax finally
    determined to be due, whichever is greater, not to exceed
21  $10,000.

22  Proposed Change--SB 172: This section is amended to reduce the
    penalty for an incomplete return to 5 percent a month, up to
23  10 percent of the tax finally determined to be due or $10,000,
    whichever is smaller. There is no penalty if no tax is due,
24  and the taxpayer is exempt from this penalty if the penalty
    under s. 220.801, F.S., is imposed with respect to the same
25  return.

26  This issue is not addressed in CS/SB 172.

27  Section 19. Present Situation: Section 220.222, F.S., provides
    direction for filing corporate income tax returns and allows
28  for up to six months' extension for filing, upon written
    request from the taxpayer.
29
    Proposed Change--SB 172: This bill provides that if a taxpayer
30  has been granted an extension for filing federal income tax
    return, the due date for filing its Florida return is
31  automatically extended if the taxpayer has sent to the
    department, by the original due date of the return, a copy of
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  1  the application for federal extension. The 6 month limit for
    extension of filing is deleted.
  2
    This issue is not addressed in CS/SB 172.
  3
    Section 20. Present Situation: Section 220.34, F.S., provides
  4  a 12 percent annual interest rate on any underpayment of
    estimated tax.
  5
    Proposed Change--SB 172: The interest rate for underpayment of
  6  estimated tax is changed to the rate determined under 220.807,
    F.S.
  7
    CS/SB 172 creates s. 213.235, F.S., providing for the payment
  8  of an adjusted rate of interest on tax deficiencies that arise
    on or after July 1, 1999. The amendment specifies, however,
  9  that if a lower rate of interest for the tax is specifically
    provided for in law, the lower rate shall apply. The adjusted
10  rate of interest is based upon the adjusted prime rate charged
    by banks. The adjusted rate of interest is applicable to taxes
11  enumerated in s. 213.05, F.S.

12  Section 21. Present Situation: Section 220.723, F.S., provides
    that interest is paid on overpayments of corporate income tax,
13  if such overpayments are not refunded within 3 months after
    the date when the taxpayer files a written notice advising the
14  department of such overpayment. The interest rate on
    overpayments is the rate determined under s. 220.807, F.S.
15
    Proposed Change--SB 172: Interest will be paid on overpayments
16  that are not refunded within 60 days after the tax was due or
    paid. The taxpayer need not file a written notice advising the
17  department of an overpayment. The rate of interest paid on
    refunds is 1 percent less than the rate determined under s.
18  220.807, F.S.

19  CS/SB 172 creates s. 213.255, F.S., providing for the payment
    of interest on overpayments of taxes, payment of taxes not
20  due, or taxes paid in error. The amendment specifies that this
    provision applies to eligible refunds based on tax payments
21  made on or after July 1, 1999. The interest rate is the
    adjusted rate established under s. 213.235, F.S.
22
    Under the measure, interest does not commence until 90 days
23  after a completed application is filed with the department and
    the amount of overpayment has not been refunded or applied as
24  a credit. In the event of a court-ordered refund based upon
    the unconstitutionality of a tax, interest shall not commence
25  until 90 days after the adjudication becomes final and
    unappealable or 90 days after a complete application is filed,
26  whichever is later. If the department has reasonable cause to
    believe that it could not recover a refund paid in error from
27  the person claiming the refund, no interest shall be required
    unless the person files a cash bond or a surety bond or makes
28  other security arrangements.

29  Section 22. Present Situation: Section 220.737 allows the
    department to provide by regulation that amounts less than $1
30  need not be paid, refunded, or credited, or that amounts less
    than $1 may be rounded to the nearest dollar.
31
    Proposed Change--SB 172: This section is amended to provide
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  1  that a taxpayer need not file a return or pay any tax if the
    tax due is less than $20.
  2
    This issue is not addressed in CS/SB 172.
  3
    Section 23. Present Situation: Section 220.801, F.S., provides
  4  penalties for failure to timely file any tax required under
    this chapter. The penalty is 10 percent of the tax per month
  5  while the delinquency exists, not exceeding 50 percent of the
    aggregate tax due. Failure to file a required tax return, even
  6  if no tax is due, is subject to a penalty of $50 per month, up
    to $300. This provision applies only to corporations when they
  7  are also required to file a federal income tax return. No
    taxpayer is assessed penalties for failure to file a return by
  8  the prescribed date and failure to file a return with no tax
    owed with respect to the same return.
  9
    Proposed Change--SB 172: The penalty for failure to timely
10  file a tax return is reduced to 5 percent per month, not to
    exceed 25 percent, and the penalty for failure to file a
11  return with no tax owed is deleted.

12  This issue is not addressed in CS/SB 172.

13  Section 24. Present Situation: Section 213.21, F.S., gives the
    Department of Revenue authority to settle or compromise a
14  taxpayer's liability for tax, penalty or interest.  The
    department is directed to settle or compromise penalties if it
15  is determined by the department that the noncompliance is due
    to reasonable cause and not to willful negligence, willful
16  neglect, or fraud.

17  Proposed Change--SB 172: This bill creates s. 220.8051, F.S.,
    providing for waiver of penalties for corporate income tax
18  upon a showing of reasonable cause for a taxpayer's filing of
    an incomplete return or failure to timely file a return or pay
19  tax owed. The taxpayer must promptly file the return and pay
    the overdue tax as soon as the reasonable cause no longer
20  applies.

21  This issue is not addressed in CS/SB 172.

22  Section 25. Present Situation: Section 220.809, F.S., provides
    for interest to be charged for overdue corporate income tax
23  payments. Interest accrues on penalties that are not paid
    within 20 days of the notice that they are imposed, but only
24  from the date of the notice. Interest is also imposed upon
    erroneous refunds.
25
    Proposed Change--SB 172: The provisions that interest accrues
26  on penalties and refunds made in error are deleted.

27  This issue is not addressed in CS/SB 172.

28  Section 26. Present Situation: Section 221.02, F.S., provides
    credit for emergency excise taxes paid. This credit may be
29  carried forward for five taxable years immediately after the
    tax was paid.
30
    Proposed Change--SB 172: This section is amended to allow
31  these credits to be carried forward until they are fully used.

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  1  This issue is not addressed in CS/SB 172.

  2  Section 27. Present Situation: Section 236.081, F.S., provides
    that the Legislature shall prescribe the aggregate required
  3  local effort for all school districts as an item in the
    General Appropriations Act for each fiscal year. Article VII
  4  Section 9.(b) of the Florida Constitution limits local ad
    valorem tax rates to 10 mills for all school purposes.
  5
    Proposed Change--SB 172: This section is amended to limit the
  6  required local effort to an amount that, based on the most
    current information available, would result in an aggregate
  7  required-local-effort millage in excess of 6.029 mills.

  8  This issue is not addressed in CS/SB 172.

  9  Section 28. of SB 172 provides that for the 1999-2000 fiscal
    year only, the base student allocation determined under s.
10  236.081(1), F.S., may not be less than the base student
    allocation in the 1998-1999 fiscal year adjusted for
11  inflation.

12  This issue is not addressed in CS/SB 172.

13  Two issues are addressed in CS/SB 172 that were not in the
    original bill.
14
    CS/SB 172 amends ss. 212.07 and 212.18, Florida Statutes,
15  providing for annual issuance of resale certificates to active
    accounts. Specifically, the bill provides the following:
16
    -     A dealer who makes a sale for resale must document the
17        exempt status of the transaction by either retaining a
          copy of the purchaser's resale certificate or by
18        documenting, before the sale, an authorization number
          provided by the DOR electronically or by telephone, or
19        by other means established by the DOR by rule.

20  -     Annually, the DOR will provide each active dealer with a
          new resale certificate, valid for twelve months. New
21        dealers will receive a certificate upon registration.

22  -     "Active dealer" is defined to mean a person who is
          currently registered with the DOR and who complies with
23        the requirement to file at least once during each
          applicable reporting period.
24
    CS/SB 172 amends s. 212.11, Florida Statutes, to delay the
25  date by which estimated taxes must be filed and paid to the
    28th day of the month. The threshold for being required to pay
26  estimated taxes is raised to $200,000 taxes paid in the
    previous year.
27

28

29

30

31

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