Senate Bill 0318er

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    1999 Legislature                  CS for SB 318, 2nd Engrossed



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  2         An act relating to intangible property taxes;

  3         amending s. 199.023, F.S.; changing the term

  4         "affiliated group of corporations" to the term

  5         "affiliated group" and including limited

  6         liability companies within its meaning;

  7         amending s. 199.033, F.S.; reducing the rates

  8         of the tax on securities in a Florida Futures

  9         Investment Fund to conform; amending s.

10         199.052, F.S.; providing that limited liability

11         companies may elect to file a consolidated

12         intangibles tax return; amending s. 199.032,

13         F.S.; reducing the rate of such taxes; amending

14         s. 199.185, F.S.; prescribing the amount of

15         accounts receivable subject to the tax as of

16         January 1, 2000; providing that an exemption

17         applies to the last 0.5 mill of the annual tax;

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.  Subsection (8) of section 199.023, Florida

23  Statutes, 1998 Supplement, is amended to read:

24         199.023  Definitions.--As used in this chapter:

25         (8)  "Affiliated group of corporations" means one or

26  more chains of corporations or limited liability companies

27  connected through stock ownership or membership interest in a

28  limited liability company with a common parent corporation or

29  limited liability company, for which providing that:

30         (a)  Stock or membership interest in a limited

31  liability company possessing at least 80 percent of the voting


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    1999 Legislature                  CS for SB 318, 2nd Engrossed



  1  power of all classes of stock or membership interest in a

  2  limited liability company and at least 80 percent of each

  3  class of the nonvoting stock or membership interest in a

  4  limited liability company of each corporation or limited

  5  liability company, except for the common parent corporation or

  6  limited liability company, is owned directly by one or more of

  7  the other corporations or limited liability companies; and

  8         (b)  The common parent corporation or limited liability

  9  company directly owns stock or membership interest in a

10  limited liability company possessing at least 80 percent of

11  the voting power of all classes of stock or membership

12  interest in a limited liability company and at least 80

13  percent of each class of the nonvoting stock or membership

14  interest in a limited liability company of at least one of the

15  other corporations or limited liability companies.

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17  As used in this subsection, the terms term "nonvoting stock"

18  and "membership interest in a limited liability company" do

19  does not include nonvoting stock or membership interest in a

20  limited liability company which is limited and preferred as to

21  dividends. For purposes of this chapter, a common parent may

22  be a corporation or a limited liability company.

23         Section 2.  Subsection (1) of section 199.033, Florida

24  Statutes, is amended to read:

25         199.033  Securities in a Florida's Future Investment

26  Fund; tax rate.--

27         (1)  Notwithstanding the provisions of this chapter,

28  the tax imposed under s. 199.032 on securities in a Florida's

29  Future Investment Fund shall apply at the rate of 1.35 1.85

30  mills when the average daily balance in such funds exceeds $2

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    1999 Legislature                  CS for SB 318, 2nd Engrossed



  1  billion and at the rate of 1.20 1.70 mills when the average

  2  daily balance in such funds exceeds $5 billion.

  3         Section 3.  Subsection (10) of section 199.052, Florida

  4  Statutes, 1998 Supplement, is amended to read:

  5         199.052  Annual tax returns; payment of annual tax.--

  6         (10)  An affiliated group of corporations may elect to

  7  make a consolidated return for any year.  The election shall

  8  be made by timely filing a consolidated return. Once made, an

  9  election may not be revoked, and it is binding for the tax

10  year.  The mere making of a consolidated return shall not in

11  itself provide a business situs in this state for intangible

12  personal property held by a corporation.  The fact that

13  members of an affiliated group own stock in corporations or

14  membership interest in limited liability companies which do

15  not qualify under the stock ownership or membership interest

16  in a limited liability company requirements as members of an

17  affiliated group shall not preclude the filing of a

18  consolidated return on behalf of the qualified members.  Where

19  a consolidated return is made, intercompany accounts,

20  including the capital stock or membership interest in a

21  limited liability company of an includable corporation or

22  limited liability company, other than the parent, owned by

23  another includable corporation or limited liability company,

24  shall not be subject to annual taxation. However, capital

25  stock, or membership interest in a limited liability company,

26  and other intercompany accounts of a nonqualified member of

27  the affiliated group shall be subject to annual tax.  Each

28  consolidated return shall be accompanied by documentation

29  identifying all intercompany accounts and containing such

30  other information as the department shall require. Failure to

31  timely file a consolidated return shall not prejudice the


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    1999 Legislature                  CS for SB 318, 2nd Engrossed



  1  taxpayer's right to file a consolidated return, provided that

  2  the failure to file a consolidated return is limited to 1 year

  3  and the taxpayer's intent to file a consolidated return is

  4  evidenced by the taxpayer having filed a consolidated return

  5  for the 3 years prior to the year the return was not timely

  6  filed.

  7         Section 4.  Section 199.032, Florida Statutes, is

  8  amended to read:

  9         199.032  Levy of annual tax.--An annual tax of 1.5 2

10  mills is hereby imposed on each dollar of the just valuation

11  of all intangible personal property that which has a taxable

12  situs in this state, except for notes and other obligations

13  for the payment of money, other than bonds, which are secured

14  by mortgage, deed of trust, or other lien upon real property

15  situated in the state. This tax shall be assessed and

16  collected as provided in this chapter.

17         Section 5.  Paragraph (l) of subsection (1) and

18  paragraph (b) of subsection (2) of section 199.185, Florida

19  Statutes, 1998 Supplement, are amended to read:

20         199.185  Property exempted from annual and nonrecurring

21  taxes.--

22         (1)  The following intangible personal property shall

23  be exempt from the annual and nonrecurring taxes imposed by

24  this chapter:

25         (l)  Two-thirds One-third of the accounts receivable

26  arising or acquired in the ordinary course of a trade or

27  business which are owned, controlled, or managed by a taxpayer

28  on January 1, 2000 1999, and thereafter. It is the intent of

29  the Legislature that, pursuant to future legislative action,

30  the portion of such accounts receivable exempt from taxation

31  be increased to two-thirds for taxes levied on January 1,


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    1999 Legislature                  CS for SB 318, 2nd Engrossed



  1  2000, and further increased to all such accounts receivable on

  2  January 1, 2001, and thereafter. This exemption does not apply

  3  to accounts receivable that which arise outside the taxpayer's

  4  ordinary course of trade or business. For the purposes of this

  5  chapter, the term "accounts receivable" means a business debt

  6  that is owed by another to the taxpayer or the taxpayer's

  7  assignee in the ordinary course of trade or business and is

  8  not supported by negotiable instruments. Accounts receivable

  9  include, but are not limited to, credit card receivables,

10  charge card receivables, credit receivables, margin

11  receivables, inventory or other floor plan financing, lease

12  payments past due, conditional sales contracts, retail

13  installment sales agreements, financing lease contracts, and a

14  claim against a debtor usually arising from sales or services

15  rendered and which is not necessarily due or past due. The

16  examples specified in this paragraph shall be deemed not to be

17  supported by negotiable instruments. The term "negotiable

18  instrument" means a written document that is legally capable

19  of being transferred by indorsement or delivery. The term

20  "indorsement" means the act of a payee or holder in writing

21  his or her name on the back of an instrument without further

22  qualifying words other than "pay to the order of" or "pay to"

23  whereby the property is assigned and transferred to another.

24         (2)

25         (b)  With respect to the last 0.5 mill of the annual

26  tax, every natural person is entitled each year to an

27  exemption of the first $100,000 of the value of property

28  otherwise subject to said tax. A husband and wife filing

29  jointly shall have an exemption of $200,000.

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    1999 Legislature                  CS for SB 318, 2nd Engrossed



  1  Agents and fiduciaries, other than guardians and custodians

  2  under a gifts-to-minors act, filing as such may not claim this

  3  exemption on behalf of their principals or beneficiaries;

  4  however, if the principal or beneficiary returns the property

  5  held by the agent or fiduciary and is a natural person, the

  6  principal or beneficiary may claim the exemption.  No taxpayer

  7  shall be entitled to more than one exemption under paragraph

  8  (a) and one exemption under paragraph (b).  This exemption

  9  shall not apply to that intangible personal property described

10  in s. 199.023(1)(d).

11         Section 6.  This act shall take effect January 1, 2000.

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