HB 133

1
A bill to be entitled
2An act relating to commercial launch zone tax incentives;
3creating s. 220.194, F.S.; providing intent; providing
4definitions; authorizing certain commercial spaceflight
5businesses to take a credit against the corporate income
6tax for certain commercial spaceflight projects;
7specifying eligible tax credits; specifying criteria,
8requirements, and limitations for individual tax credits;
9establishing eligibility requirements for the tax credits;
10allowing for the carryforward of tax credits under certain
11circumstances; providing application and certification
12requirements; requiring the Office of Tourism, Trade, and
13Economic Development to determine the eligibility of
14taxpayers; providing for the expiration and renewal of a
15taxpayer's eligibility for tax credits; providing for
16administration and auditing of tax credits by the
17Department of Revenue; requiring the return and deposit of
18tax credits under certain circumstances; requiring the
19office to consult with Space Florida and adopt rules for
20tax credit applications and certifications; authorizing
21the department to adopt rules for tax administration,
22claims and transfers of tax credits, auditing, and
23reporting; requiring an annual report to the Governor and
24Legislature; amending s. 14.2015, F.S.; revising the
25duties of the office to include administration of the tax
26credits created by the act; amending s. 213.053, F.S.;
27providing for sharing of confidential information;
28amending s. 220.02, F.S.; revising legislative intent
29relating to the order for applying tax credits; amending
30s. 220.13, F.S.; specifying that net operating losses
31taken or transferred as corporate income tax credits may
32not also be deducted from income; amending s. 220.16,
33F.S.; adding the financial assistance obtained by the sale
34of tax credits pursuant to s. 220.194, F.S., to the
35category of nonbusiness income that must be reported;
36providing an effective date.
37
38Be It Enacted by the Legislature of the State of Florida:
39
40     Section 1.  Section 220.194, Florida Statutes, is created
41to read:
42     220.194  Corporate income tax credits for commercial
43spaceflight projects in Florida's commercial launch zone.--
44     (1)  INTENT.--The intent of this section is to create
45incentives to attract commercial launch, payload, and other
46commercial space business to this state.
47     (2)  DEFINITIONS.--As used in this section, the term:
48     (a)  "Commercial launch zone" means an area within
49spaceport territory, as defined in s. 331.303(18).
50     (b)  "Certified commercial spaceflight business" means a
51business that has been certified by the office; is registered
52with the Secretary of State to do business in this state; and is
53currently undertaking in this state, for nongovernmental
54purposes only, the following activities that will eventually
55result in a launch from a commercial launch zone: designing or
56manufacturing a launch vehicle, reentry vehicle, or components
57thereof; providing a launch service or reentry service; or
58providing the payload for a launch vehicle or reentry vehicle.
59The business may participate in more than one commercial
60spaceflight project at a time. For the purposes of applying for
61the tax incentives created in this section, a certified
62commercial spaceflight business also must have:
63     1.  Created, filled, and retained at least 35 net new jobs
64associated with an individual spaceflight project within the 3
65calendar years prior to claiming the credit;
66     2.  Invested a total of at least $15 million in an
67individual spaceflight project during the 3 calendar years prior
68to claiming the credit; and
69     3.  Participated in a commercial spaceflight project that
70resulted in a successful launch from a commercial launch zone
71within the previous 3 years.
72     (c)  "Commercial spaceflight project" means an activity
73performed by a certified commercial spaceflight business related
74to the launch or reentry of a launch vehicle or reentry vehicle
75for launches from a commercial launch zone. The term includes a
76launch service or reentry service, and any process that
77validates hardware or components to meet design and workmanship
78criteria for space launch vehicles per United States Department
79of Defense and National Aeronautics and Space Administration
80guidelines.
81     (d)  "Launch" means to place or attempt to place a launch
82vehicle or reentry vehicle and any payload from Earth into a
83suborbital trajectory, into Earth orbit in outer space, or
84otherwise into outer space.
85     (e)  "Launch service" means an activity related to the
86preparation of a launch vehicle and any payload for launch and
87the conduct of a launch.
88     (f)  "New job" means a full-time equivalent position that
89is created by a certified commercial spaceflight business on or
90after January 1, 2011, to work on a commercial spaceflight
91project; is not held by an owner, partner, or majority
92stockholder of the business; is not an administrative, clerical,
93or janitorial position; and is filled by an employee. The same
94job may not be counted more than once for the purposes of
95claiming incentives created by this section.
96     (g)  "Office" means the Governor's Office of Tourism,
97Trade, and Economic Development.
98     (h)  "Outer space" means an altitude of at least 50 miles
99above the Earth's surface.
100     (i)  "Payload" means an object that a certified commercial
101spaceflight business undertakes to place in outer space by means
102of a launch vehicle or reentry vehicle, including components of
103the vehicle specifically designed or adapted for the object.
104     (j)  "Reentry" means to return or attempt to return a
105reentry vehicle and any payload from Earth orbit, or from outer
106space, to Earth.
107     (k)  "Reentry service" means an activity related to the
108preparation of a reentry vehicle and any payload for reentry and
109conduct of the reentry.
110     (l)  "Spaceport territory" has the same meaning as defined
111in s. 331.303(18).
112     (m)  "Space vehicle" means any spacecraft, satellite,
113upper-stage, or launch vehicle system.
114     (n)  "Successful launch" means a launch that successfully
115places a launch vehicle or reentry vehicle and any payload from
116Earth into a suborbital trajectory, into Earth orbit in outer
117space, or otherwise into outer space.
118     (o)  "Taxpayer" has the same meaning as defined in s.
119220.03.
120     (3)  TAX CREDITS.--For any tax year beginning on or after
121January 1, 2014, a certified commercial spaceflight business
122providing or conducting commercial spaceflight projects may
123select one of the following tax credits for which it is
124certified:
125     (a)  Nontransferable corporate income tax credit.--A credit
126equal to 50 percent of the net tax imposed by this chapter shall
127be granted to a certified commercial spaceflight business. Under
128no circumstances may the business claim this credit in any tax
129year that exceeds its corporate income tax liability that same
130tax year.
131     (b)  Transferable net operating loss tax credit.--The
132certified commercial spaceflight business may convert its net
133operating loss that has not otherwise been deducted from income
134for Florida tax purposes to a transferable tax credit as
135provided below.
136     1.  In addition to meeting the requirements in paragraph
137(2)(b), the business must:
138     a.  Have incurred net operating losses in any of the
139previous 3 calendar years; and
140     b.  Not be at least 50 percent owned or controlled,
141directly or indirectly, by another corporation that has
142demonstrated positive net income in any of the 3 previous years
143of ongoing operations, or not be part of a consolidated group of
144affiliated corporations, as filed for federal income tax
145purposes, which in the aggregate demonstrated positive net
146income in any of the 3 previous years of ongoing operations.
147     2.  The amount of the transferable tax credit is equal to:
148     a.  One hundred percent of the net operating losses
149incurred by a certified commercial spaceflight business during
150its first full year of operations.
151     b.  One hundred percent of the net operating losses
152incurred by a certified commercial spaceflight business during
153its second full year of operations.
154     c.  One hundred percent of the net operating losses
155incurred by a certified commercial spaceflight business during
156its third full year of operations.
157     3.  A certified commercial spaceflight business allowed a
158tax credit under this paragraph may transfer all or part of a
159transferable tax credit to any taxpayer that is subject to the
160tax imposed by this chapter. The certified commercial
161spaceflight business has 5 years after the date of its original
162certification to transfer a net operating loss tax credit. The
163transfer must be by written agreement for consideration of no
164less than 75 percent of the credit's face value. The transferee
165is entitled to apply the credit to the taxes owed under this
166chapter, and may carry forward an unused credit up to 5 years.
167Under no circumstances may the transferee claim a credit in any
168tax year that exceeds the corporate income taxes it owes that
169same tax year.
170     4.  The office may not approve a cumulative amount of
171transferrable net operating loss tax credits that may result in
172the claim of more than $50 million in tax credits during a
173single state fiscal year. However, the potential for a taxpayer
174to carry forward an unused tax credit may not be considered in
175calculating the annual limit.
176     (c)  Jobs tax credit.--A credit against the tax imposed by
177this chapter shall be granted to a certified commercial
178spaceflight business, in an amount equal to 10 percent of the
179annual wages subject to unemployment tax paid by the commercial
180spaceflight business to each employee in a new job, not to
181exceed $7,500 per employee. The credits may be applied up to the
182amount of taxes owed under this chapter for the tax year in
183which they are claimed. Unused credits may be carried forward
184for up to 5 years. The office may not approve a cumulative
185amount of jobs tax credits that may result in the claim of more
186than $15 million in tax credits in a single state fiscal year.
187However, the potential for a taxpayer to carry forward an unused
188tax credit may not be considered in calculating the annual
189limit.
190     (d)  Machinery and equipment credit.--A credit against the
191tax imposed by this chapter shall be granted to a certified
192commercial spaceflight business that invests a cumulative total
193of at least $500,000 in machinery and equipment that is used for
194a commercial spaceflight project. An investment in machinery and
195equipment may be claimed once. The amount of the credit is equal
196to 7.5 percent of the investment of machinery and equipment. The
197taxpayer may only claim a credit not exceeding 50 percent of the
198taxpayer's tax liability in the year in which it is claimed. If
199credit granted under this paragraph is not fully used in any one
200tax year because of insufficient tax liability, the unused
201amount may be carried forward for up to 5 years.
202     (4)  ADMINISTRATION.--
203     (a)  Unless transferred as provided in paragraph (3)(b),
204credits awarded under this section may be granted only against
205the corporate income tax liability generated by or arising out
206of a commercial spaceflight project, as documented in the
207business's annual audit prepared by a certified public
208accountant licensed to do business in this state and verified by
209the office.
210     (b)  Certified spaceflight businesses may not file
211consolidated returns for the purposes of claiming the tax
212incentives described paragraphs (3)(a)-(d).
213     (c)  It is the responsibility of the certified commercial
214spaceflight business or transferee to demonstrate to the
215office's and the department's satisfaction that it is eligible
216for credit under this section.
217     (5)  APPLICATION AND CERTIFICATION.--To claim tax credits
218under this section, a commercial spaceflight business must
219submit a certification application to Space Florida for review.
220The application must include the following information, along
221with a $250 nonrefundable fee:
222     (a)  The name and physical Florida address of the taxpayer.
223     (b)  Documentation that the taxpayer is a commercial
224spaceflight business.
225     (c)  Documentation of the business's current commercial
226spaceflight project and any other information it will need to
227qualify for the tax credits, where applicable.
228     (d)  The total amount and types of credits sought.
229     (e)  The amount of transferable tax credits to be
230transferred, if any; when the business expects to transfer them;
231and the name and address of the recipient taxpayer or taxpayers.
232     (f)  A copy of an audit or audits of the pertinent tax
233years prepared by a certified public accountant licensed to
234practice in this state, that specifies, if applicable, that
235portion of the business's activities related to commercial
236spaceflight projects.
237     (g)  An acknowledgement that it must file an annual report
238on the project's progress with Space Florida and the office.
239     (h)  Any other information necessary to demonstrate that
240the applicant meets the job creation, investment, and other
241requirements of this section.
242
243Within 60 days after receipt of the application, the executive
244staff of Space Florida shall evaluate the application and
245recommend it for certification or denial of certification by the
246office. The executive director of the office has 30 days
247following receipt of Space Florida's recommendation to approve
248or deny the application. The office shall provide a letter of
249certification to the applicant, if approved. If the office
250denies any part of the application, it shall inform the
251applicant of the grounds for the denial. A copy of the
252certification shall be submitted to the department within 10
253days after the executive director's decision.
254     (6)  COMMERCIAL SPACEFLIGHT BUSINESS; EXPIRATION OF
255ELIGIBILITY FOR TAX CREDITS; RENEWAL.--Eligibility of a
256certified commercial spaceflight business for credits under this
257section shall expire 10 years after the executive director of
258the office certifies that the commercial spaceflight business is
259eligible for the credit program, or 10 years after the business'
260last successful launch of its commercial spaceflight project,
261whichever occurs later. A certified commercial spaceflight
262business whose eligibility expires under this subsection may
263renew its eligibility for another 10 years, upon a successful
264launch that results from its commercial spaceflight project.
265     (7)  ADMINISTRATION; AUDIT AUTHORITY; RECAPTURE OF
266CREDITS.--
267     (a)  In addition to its existing audit and investigative
268authority, the department may perform any additional financial
269and technical audits and investigations, including examining the
270accounts, books, and financial records of the tax credit
271applicant, which are necessary to verify the eligible costs
272included in the tax credit return and to ensure compliance with
273this section. The office shall provide technical assistance when
274requested by the department on any technical audits or
275examinations performed under this subsection.
276     (b)  It is grounds for forfeiture of previously claimed and
277received tax credits if the department determines, as a result
278of an audit or examination, or from information received from
279the office, that a certified commercial spaceflight business, or
280in the case of transferred tax credits a taxpayer, received tax
281credits under this section to which the certified commercial
282spaceflight business or taxpayer was not entitled. The certified
283commercial spaceflight business or taxpayer is responsible for
284returning forfeited tax credits to the department, and any
285returned funds shall be deposited in the state's General Revenue
286Fund.
287     (c)  The certified commercial spaceflight business must
288repay the credit amount claimed or transferred if its net
289operating loss is adjusted by amendment or as a result of any
290other recomputation or redetermination of federal or Florida
291taxable income or loss. The certified commercial spaceflight
292business also is liable for a penalty equal to the amount of the
293credit claimed or transferred, reduced in proportion to the
294amount of the net operating loss certified for transfer over the
295amount of the certified net operating loss disallowed. The
296applicant and its successors shall maintain all records
297necessary to support the reported net operating loss.
298     (d)  The office may revoke or modify any written decision
299granting eligibility for tax credits under this section if it is
300discovered that the certified commercial spaceflight business
301submitted any false statement, representation, or certification
302in any application, record, report, plan, or other document
303filed in an attempt to receive tax credits under this section.
304The office shall immediately notify the department of any
305revoked or modified orders affecting previously granted tax
306credits. Additionally, the certified commercial spaceflight
307business must notify the department of any change in its tax
308credit claimed.
309     (e)  The certified commercial spaceflight business shall
310file with the department an amended return or other report as
311the department prescribes by rule and shall pay any required tax
312and interest within 60 days after the certified commercial
313spaceflight business receives notification from the office that
314previously approved tax credits have been revoked or modified.
315If the revocation or modification order is contested, the
316certified commercial spaceflight business shall file an amended
317return or other report as provided in this paragraph within 60
318days after a final order is issued following proceedings.
319     (f)  The department may assess additional tax, penalty, and
320interest as permitted by s. 95.091.
321     (8)  RULES.--
322     (a)  The office, in consultation with Space Florida, shall
323adopt rules under ss. 120.536(1) and 120.54 to administer this
324section, including rules relating to the certification forms for
325commercial spaceflight businesses to complete, and the
326application and certification procedures, guidelines, and
327requirements necessary to administer this section.
328     (b)  The department may adopt rules under ss. 120.536(1)
329and 120.54 to administer this section, including rules relating
330to:
331     1.  The forms required to claim a tax credit under this
332section, the requirements and basis for establishing an
333entitlement to a credit, and the examination and audit
334procedures required to administer this section.
335     2.  The implementation and administration of the provisions
336allowing a transfer of a net operating loss as a tax credit,
337including rules prescribing forms, reporting requirements, and
338specific procedures, guidelines, and requirements necessary to
339perform the transfer.
340     3.  The minimum portion of the credit that is available for
341transfer.
342     (9)  ANNUAL REPORT.--The office, in cooperation with Space
343Florida and the department, shall submit an annual report of the
344commercial launch zone incentive program's activities to the
345Governor, the President of the Senate, and the Speaker of the
346House of Representatives by November 30 of each year, beginning
347in 2014.
348     Section 2.  Paragraph (f) of subsection (2) of section
34914.2015, Florida Statutes, is amended to read:
350     14.2015  Office of Tourism, Trade, and Economic
351Development; creation; powers and duties.--
352     (2)  The purpose of the Office of Tourism, Trade, and
353Economic Development is to assist the Governor in working with
354the Legislature, state agencies, business leaders, and economic
355development professionals to formulate and implement coherent
356and consistent policies and strategies designed to provide
357economic opportunities for all Floridians. To accomplish such
358purposes, the Office of Tourism, Trade, and Economic Development
359shall:
360     (f)1.  Administer the Florida Enterprise Zone Act under ss.
361290.001-290.016, the community contribution tax credit program
362under ss. 220.183 and 624.5105, the tax refund program for
363qualified target industry businesses under s. 288.106, the tax-
364refund program for qualified defense contractors and space
365flight business contractors under s. 288.1045, contracts for
366transportation projects under s. 288.063, the sports franchise
367facility program under s. 288.1162, the professional golf hall
368of fame facility program under s. 288.1168, the expedited
369permitting process under s. 403.973, the Rural Community
370Development Revolving Loan Fund under s. 288.065, the Regional
371Rural Development Grants Program under s. 288.018, the Certified
372Capital Company Act under s. 288.99, the Florida State Rural
373Development Council, the Rural Economic Development Initiative,
374the corporate income tax credits for commercial spaceflight
375projects under s. 220.194, and other programs that are
376specifically assigned to the office by law, by the
377appropriations process, or by the Governor. Notwithstanding any
378other provisions of law, the office may expend interest earned
379from the investment of program funds deposited in the Grants and
380Donations Trust Fund to contract for the administration of the
381programs, or portions of the programs, enumerated in this
382paragraph or assigned to the office by law, by the
383appropriations process, or by the Governor. Such expenditures
384shall be subject to review under chapter 216.
385     2.  The office may enter into contracts in connection with
386the fulfillment of its duties concerning the Florida First
387Business Bond Pool under chapter 159, tax incentives under
388chapters 212 and 220, tax incentives under the Certified Capital
389Company Act in chapter 288, foreign offices under chapter 288,
390the Enterprise Zone program under chapter 290, the Seaport
391Employment Training program under chapter 311, the Florida
392Professional Sports Team License Plates under chapter 320,
393Spaceport Florida under chapter 331, Expedited Permitting under
394chapter 403, and in carrying out other functions that are
395specifically assigned to the office by law, by the
396appropriations process, or by the Governor.
397     Section 3.  Paragraph (z) is added to subsection (8) of
398section 213.053, Florida Statutes, to read:
399     213.053  Confidentiality and information sharing.--
400     (8)  Notwithstanding any other provision of this section,
401the department may provide:
402     (z)  Information relative to tax credits taken under s.
403220.194 to the Office of Tourism, Trade, and Economic
404Development or to Space Florida.
405
406Disclosure of information under this subsection shall be
407pursuant to a written agreement between the executive director
408and the agency. Such agencies, governmental or nongovernmental,
409shall be bound by the same requirements of confidentiality as
410the Department of Revenue. Breach of confidentiality is a
411misdemeanor of the first degree, punishable as provided by s.
412775.082 or s. 775.083.
413     Section 4.  Subsection (8) of section 220.02, Florida
414Statutes, is amended to read:
415     220.02  Legislative intent.--
416     (8)  It is the intent of the Legislature that credits
417against either the corporate income tax or the franchise tax be
418applied in the following order: those enumerated in s. 631.828,
419those enumerated in s. 220.191, those enumerated in s. 220.181,
420those enumerated in s. 220.183, those enumerated in s. 220.182,
421those enumerated in s. 220.1895, those enumerated in s. 221.02,
422those enumerated in s. 220.184, those enumerated in s. 220.186,
423those enumerated in s. 220.1845, those enumerated in s. 220.19,
424those enumerated in s. 220.185, those enumerated in s. 220.187,
425those enumerated in s. 220.192, those enumerated in s. 220.193,
426and those enumerated in s. 288.9916, and those enumerated in s.
427220.194.
428     Section 5.  Paragraphs (a) and (b) of subsection (1) of
429section 220.13, Florida Statutes, are amended to read:
430     220.13  "Adjusted federal income" defined.--
431     (1)  The term "adjusted federal income" means an amount
432equal to the taxpayer's taxable income as defined in subsection
433(2), or such taxable income of more than one taxpayer as
434provided in s. 220.131, for the taxable year, adjusted as
435follows:
436     (a)  Additions.--There shall be added to such taxable
437income:
438     1.  The amount of any tax upon or measured by income,
439excluding taxes based on gross receipts or revenues, paid or
440accrued as a liability to the District of Columbia or any state
441of the United States which is deductible from gross income in
442the computation of taxable income for the taxable year.
443     2.  The amount of interest which is excluded from taxable
444income under s. 103(a) of the Internal Revenue Code or any other
445federal law, less the associated expenses disallowed in the
446computation of taxable income under s. 265 of the Internal
447Revenue Code or any other law, excluding 60 percent of any
448amounts included in alternative minimum taxable income, as
449defined in s. 55(b)(2) of the Internal Revenue Code, if the
450taxpayer pays tax under s. 220.11(3).
451     3.  In the case of a regulated investment company or real
452estate investment trust, an amount equal to the excess of the
453net long-term capital gain for the taxable year over the amount
454of the capital gain dividends attributable to the taxable year.
455     4.  That portion of the wages or salaries paid or incurred
456for the taxable year which is equal to the amount of the credit
457allowable for the taxable year under s. 220.181. This
458subparagraph shall expire on the date specified in s. 290.016
459for the expiration of the Florida Enterprise Zone Act.
460     5.  That portion of the ad valorem school taxes paid or
461incurred for the taxable year which is equal to the amount of
462the credit allowable for the taxable year under s. 220.182. This
463subparagraph shall expire on the date specified in s. 290.016
464for the expiration of the Florida Enterprise Zone Act.
465     6.  The amount of emergency excise tax paid or accrued as a
466liability to this state under chapter 221 which tax is
467deductible from gross income in the computation of taxable
468income for the taxable year.
469     7.  That portion of assessments to fund a guaranty
470association incurred for the taxable year which is equal to the
471amount of the credit allowable for the taxable year.
472     8.  In the case of a nonprofit corporation which holds a
473pari-mutuel permit and which is exempt from federal income tax
474as a farmers' cooperative, an amount equal to the excess of the
475gross income attributable to the pari-mutuel operations over the
476attributable expenses for the taxable year.
477     9.  The amount taken as a credit for the taxable year under
478s. 220.1895.
479     10.  Up to nine percent of the eligible basis of any
480designated project which is equal to the credit allowable for
481the taxable year under s. 220.185.
482     11.  The amount taken as a credit for the taxable year
483under s. 220.187.
484     12.  The amount taken as a credit for the taxable year
485under s. 220.192.
486     13.  The amount taken as a credit for the taxable year
487under s. 220.193.
488     14.  Any portion of a qualified investment, as defined in
489s. 288.9913, which is claimed as a deduction by the taxpayer and
490taken as a credit against income tax pursuant to s. 288.9916.
491     15.  The amount taken as a credit for the taxable year
492under s. 220.194.
493     (b)  Subtractions.--
494     1.  There shall be subtracted from such taxable income:
495     a.  The net operating loss deduction allowable for federal
496income tax purposes under s. 172 of the Internal Revenue Code
497for the taxable year,
498     b.  The net capital loss allowable for federal income tax
499purposes under s. 1212 of the Internal Revenue Code for the
500taxable year, except that any net operating loss taken as a
501credit to corporate income taxes owed or that is transferred,
502pursuant to s. 220.194(3)(b), may not be deducted by the seller,
503     c.  The excess charitable contribution deduction allowable
504for federal income tax purposes under s. 170(d)(2) of the
505Internal Revenue Code for the taxable year, and
506     d.  The excess contributions deductions allowable for
507federal income tax purposes under s. 404 of the Internal Revenue
508Code for the taxable year.
509
510However, a net operating loss and a capital loss shall never be
511carried back as a deduction to a prior taxable year, but all
512deductions attributable to such losses shall be deemed net
513operating loss carryovers and capital loss carryovers,
514respectively, and treated in the same manner, to the same
515extent, and for the same time periods as are prescribed for such
516carryovers in ss. 172 and 1212, respectively, of the Internal
517Revenue Code.
518     2.  There shall be subtracted from such taxable income any
519amount to the extent included therein the following:
520     a.  Dividends treated as received from sources without the
521United States, as determined under s. 862 of the Internal
522Revenue Code.
523     b.  All amounts included in taxable income under s. 78 or
524s. 951 of the Internal Revenue Code.
525
526However, as to any amount subtracted under this subparagraph,
527there shall be added to such taxable income all expenses
528deducted on the taxpayer's return for the taxable year which are
529attributable, directly or indirectly, to such subtracted amount.
530Further, no amount shall be subtracted with respect to dividends
531paid or deemed paid by a Domestic International Sales
532Corporation.
533     3.  In computing "adjusted federal income" for taxable
534years beginning after December 31, 1976, there shall be allowed
535as a deduction the amount of wages and salaries paid or incurred
536within this state for the taxable year for which no deduction is
537allowed pursuant to s. 280C(a) of the Internal Revenue Code
538(relating to credit for employment of certain new employees).
539     4.  There shall be subtracted from such taxable income any
540amount of nonbusiness income included therein, including
541payments received for a tax credit pursuant to s. 220.194(3)(b).
542     5.  There shall be subtracted any amount of taxes of
543foreign countries allowable as credits for taxable years
544beginning on or after September 1, 1985, under s. 901 of the
545Internal Revenue Code to any corporation which derived less than
54620 percent of its gross income or loss for its taxable year
547ended in 1984 from sources within the United States, as
548described in s. 861(a)(2)(A) of the Internal Revenue Code, not
549including credits allowed under ss. 902 and 960 of the Internal
550Revenue Code, withholding taxes on dividends within the meaning
551of sub-subparagraph 2.a., and withholding taxes on royalties,
552interest, technical service fees, and capital gains.
553     6.  Notwithstanding any other provision of this code,
554except with respect to amounts subtracted pursuant to
555subparagraphs 1. and 3., any increment of any apportionment
556factor which is directly related to an increment of gross
557receipts or income which is deducted, subtracted, or otherwise
558excluded in determining adjusted federal income shall be
559excluded from both the numerator and denominator of such
560apportionment factor. Further, all valuations made for
561apportionment factor purposes shall be made on a basis
562consistent with the taxpayer's method of accounting for federal
563income tax purposes.
564     Section 6.  Subsection (5) is added to section 220.16,
565Florida Statutes, to read:
566     220.16  Allocation of nonbusiness income.--Nonbusiness
567income shall be allocated as follows:
568     (5)  The amount of payments received in exchange for
569transferring a net operating loss as authorized by s. 220.194 is
570allocable to this state.
571     Section 7.  This act shall take effect January 1, 2011, and
572credits created herein may be claimed in the tax year beginning
573on or after January 1, 2014.


CODING: Words stricken are deletions; words underlined are additions.