House Bill hb1171

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    Florida House of Representatives - 2001                HB 1171

        By Representative Weissman






  1                      A bill to be entitled

  2         An act relating to taxation; amending s.

  3         72.011, F.S.; providing for the venue and

  4         jurisdiction of taxpayer actions in circuit

  5         court; amending s. 199.023, F.S.; redefining

  6         the term "intangible personal property";

  7         amending s. 199.185, F.S.; revising exemptions

  8         from the intangible personal property tax;

  9         amending s. 212.12, F.S.; providing for methods

10         of determining overpayments by persons paying

11         the tax on sales, use, and other transactions;

12         amending s. 213.21, F.S.; revising the process

13         for review of a taxpayer's liability for tax

14         and interest; amending s. 220.03, F.S.;

15         providing for the tax classification of

16         specified entities; amending s. 608.471, F.S.;

17         providing for the tax treatment of certain

18         types of limited liability companies; providing

19         an effective date.

20

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

22

23         Section 1.  Paragraph (a) of subsection (4) and

24  subsection (5) of section 72.011, Florida Statutes, are

25  amended to read:

26         72.011  Jurisdiction of circuit courts in specific tax

27  matters; administrative hearings and appeals; time for

28  commencing action; parties; deposits.--

29         (4)(a)  Except as provided in paragraph (b), an action

30  initiated in circuit court pursuant to subsection (1) shall be

31  filed in the Second Judicial Circuit Court in and for Leon

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    Florida House of Representatives - 2001                HB 1171

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  1  County or in the circuit court in the county where the

  2  taxpayer resides, or maintains its principal commercial

  3  domicile in this state, or regularly maintains its books and

  4  records in this state.

  5         (5)  The requirements of subsections (1), (2), and (3)

  6  this section are jurisdictional.

  7         Section 2.  Paragraph (a) of subsection (1) of section

  8  199.023, Florida Statutes, is amended to read:

  9         199.023  Definitions.--As used in this chapter:

10         (1)  "Intangible personal property" means all personal

11  property which is not in itself intrinsically valuable, but

12  which derives its chief value from that which it represents,

13  including, but not limited to, the following:

14         (a)  All stocks or shares of incorporated or

15  unincorporated business entities, all interests in other types

16  of entities, any interest in a limited liability company, any

17  interest as a partner in a partnership, either general or

18  limited, including limited liability partnerships companies,

19  business trusts, and mutual funds.

20         Section 3.  Paragraph (c) of subsection (1) of section

21  199.185, Florida Statutes, is amended to read:

22         199.185  Property exempted from annual and nonrecurring

23  taxes.--

24         (1)  The following intangible personal property shall

25  be exempt from the annual and nonrecurring taxes imposed by

26  this chapter:

27         (c)  Any interest as a shareholder in a corporation, an

28  owner of an interest in any other type of entity, a member in

29  a limited liability company, a partner in a partnership,

30  including a limited liability partnership, either general or

31  limited, other than any such interest in an entity which

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    Florida House of Representatives - 2001                HB 1171

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  1  interest or entity is interest as a limited partner in a

  2  limited partnership registered with the Securities and

  3  Exchange Commission pursuant to the Securities Act of 1933, as

  4  amended.

  5         Section 4.  Paragraph (d) is added to subsection (6) of

  6  section 212.12, Florida Statutes, to read:

  7         212.12  Dealer's credit for collecting tax; penalties

  8  for noncompliance; powers of Department of Revenue in dealing

  9  with delinquents; brackets applicable to taxable transactions;

10  records required.--

11         (6)

12         (d)  A taxpayer is entitled, both in connection with an

13  audit and in connection with an application for refund filed

14  independently of any audit, to establish the amount of an

15  overpayment through statistical sampling. Alternatively, a

16  taxpayer is entitled to establish an overpayment through any

17  other sampling method agreed upon by the taxpayer and the

18  department.

19         Section 5.  Paragraph (a) of subsection (3) of section

20  213.21, Florida Statutes, is amended to read:

21         213.21  Informal conferences; compromises.--

22         (3)(a)  A taxpayer's liability for any tax or interest

23  specified in s. 72.011(1) may be compromised by the department

24  upon the grounds of doubt as to liability for or

25  collectibility of such tax or interest. A taxpayer's liability

26  for penalties under any of the chapters specified in s.

27  72.011(1) shall may be settled or compromised if it is

28  determined by the department that the noncompliance is due to

29  reasonable cause and not to willful negligence, willful

30  neglect, or fraud. The facts and circumstances are subject to

31  de novo review to determine the existence of reasonable cause

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  1  in any administrative proceeding or judicial action

  2  challenging an assessment of penalty under any of the chapters

  3  specified in s. 72.011(1). A taxpayer who establishes

  4  reasonable reliance on the written advice issued by the

  5  department to the taxpayer will be deemed to have shown

  6  reasonable cause for the noncompliance. In addition, a

  7  taxpayer's liability for penalties under any of the chapters

  8  specified in s. 72.011(1) in excess of 25 percent of the tax

  9  shall be settled or compromised if the department determines

10  that the noncompliance is due to reasonable cause and not to

11  willful negligence, willful neglect, or fraud. The department

12  shall maintain records of all compromises, and the records

13  shall state the basis for the compromise. The records of

14  compromise under this paragraph shall not be subject to

15  disclosure pursuant to s. 119.07(1) and shall be considered

16  confidential information governed by the provisions of s.

17  213.053.

18         Section 6.  Subsection (2) of section 220.03, Florida

19  Statutes, is amended to read:

20         220.03  Definitions.--

21         (2)  DEFINITIONAL RULES.--When used in this code and

22  neither otherwise distinctly expressed nor manifestly

23  incompatible with the intent thereof:

24         (a)  The word "corporation" or "taxpayer" shall be

25  deemed to include the words "and its successors and assigns"

26  as if these words, or words of similar import, were

27  expressed.;

28         (b)  Any term used in any section of this code with

29  respect to the application of, or in connection with, the

30  provisions of any other section of this code shall have the

31  same meaning as in such other section.; and

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    Florida House of Representatives - 2001                HB 1171

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  1         (c)  Any term used in this code shall have the same

  2  meaning as when used in a comparable context in the Internal

  3  Revenue Code and other statutes of the United States relating

  4  to federal income taxes, as such code and statutes are in

  5  effect on January 1, 2000. However, if subsection (3) is

  6  implemented, the meaning of any term shall be taken at the

  7  time the term is applied under this code.

  8         (d)  Notwithstanding any other provision of this

  9  chapter, the tax classification of an entity, including a

10  single-member entity, as determined under sections 7701 and

11  7704 of the Internal Revenue Code and the Treasury Regulations

12  promulgated thereunder, is determinative of the entity's

13  classification under this chapter.

14         Section 7.  Subsection (3) is added to section 608.471,

15  Florida Statutes, to read:

16         608.471  Tax exemption on income of certain limited

17  liability companies.--

18         (3)  Single-member limited liability companies and

19  other entities that are disregarded for federal income tax

20  purposes must be treated as separate legal entities for all

21  non-income-tax purposes. The Department of Revenue shall adopt

22  rules to take into account that single-member disregarded

23  entities such as limited liability companies and qualified

24  subchapter S corporations may be disregarded as separate

25  entities for federal tax purposes and therefore may report and

26  account for income, employment, and other taxes under the

27  taxpayer identification number of the owner of the

28  single-member entity.

29         Section 8.  This act shall take effect July 1, 2001.

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    Florida House of Representatives - 2001                HB 1171

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  2                          SENATE SUMMARY

  3    Provides for jurisdiction and venue of certain taxpayer
      actions in circuit court. Revises exemptions and a
  4    definition under the intangible personal property tax.
      Provides methods for the determination of overpayments by
  5    persons paying the tax on sales, use, and other
      transactions. Revises the process for review of a
  6    taxpayer's liability under the revenue laws. Provides for
      the classification of certain entities under the
  7    corporation income tax law. Provides for the treatment of
      single-member limited liability companies.
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