Florida Senate - 2011 COMMITTEE AMENDMENT
Bill No. SB 2044
Barcode 635342
LEGISLATIVE ACTION
Senate . House
.
.
.
.
.
—————————————————————————————————————————————————————————————————
—————————————————————————————————————————————————————————————————
The Committee on Budget Subcommittee on Finance and Tax
(Bogdanoff) recommended the following:
1 Senate Amendment (with title amendment)
2
3 Delete lines 230 - 404
4 and insert:
5 Section 7. Section 213.758, Florida Statutes, is amended to
6 read:
7 213.758 Transfer of tax liabilities.—
8 (1) As used in this section, the term:
9 (a) “Business” means any activity regularly engaged in by
10 any person, or caused to be engaged in by any person, for the
11 purpose of private or public gain, benefit, or advantage. The
12 term does not include occasional or isolated sales or
13 transactions involving property or services by a person who does
14 not hold himself or herself out as engaged in business. A
15 discrete division or portion of a business is not a separate
16 business and must be aggregated with all other divisions or
17 portions that constitute a business if the division or portion
18 is not a separate legal entity.
19 (b) “Financial institution” means a financial institution
20 as defined in s. 655.005 and any person who controls, is
21 controlled by, or is under common control with a financial
22 institution.
23 (c) “Insider” has the same meaning as defined in s.
24 726.102(7). The term also includes:
25 1. A manager, a managing member, or a person in control of
26 a limited liability company; or
27 2. A relative, as defined in s. 726.102(11), of any person
28 described in subparagraph 1.
29 (d)(a) “Involuntary transfer” means a transfer of a
30 business, assets of a business, or stock of goods of a business
31 made without the consent of the transferor, including, but not
32 limited to, a transfer:
33 1. That occurs due to the foreclosure of a security
34 interest issued to a person who is not an insider as defined in
35 s. 726.102;
36 2. That results from an eminent domain or condemnation
37 action;
38 3. Pursuant to chapter 61, chapter 702, or the United
39 States Bankruptcy Code;
40 4. To a financial institution, as defined in s. 655.005, if
41 the transfer is made to satisfy the transferor’s debt to the
42 financial institution; or
43 5. To a third party to the extent that the proceeds are
44 used to satisfy the transferor’s indebtedness to a financial
45 institution as defined in s. 655.005. If the third party
46 receives assets worth more than the indebtedness, the transfer
47 of the excess may not be deemed an involuntary transfer.
48 (e) “Stock of goods” means the inventory of a business held
49 for sale to customers in the ordinary course of business.
50 (f) “Tax” means any tax, interest, penalty, surcharge, or
51 fee administered by the department pursuant to chapter 443 or
52 any of the chapters specified in s. 213.05, excluding chapter
53 220, the corporate income tax code.
54 (g)(b) “Transfer” means every mode, direct or indirect,
55 with or without consideration, of disposing of or parting with a
56 business, assets of the business, or stock of goods of the
57 business, and includes, but is not limited to, assigning,
58 conveying, demising, gifting, granting, or selling, other than
59 to customers in the ordinary course of business, to a transferee
60 or to a group of transferees who are acting in concert. A
61 business is considered transferred when there is a transfer of
62 more than 50 percent of:
63 1. The business;
64 2. The assets of the business; or
65 3. The stock of goods of the business.
66 (2) A taxpayer engaged in a business who is liable for any
67 tax arising from the operation of that business, interest,
68 penalty, surcharge, or fee administered by the department
69 pursuant to chapter 443 or described in s. 72.011(1), excluding
70 corporate income tax, and who quits the a business without the
71 benefit of a purchaser, successor, or assignee, or without
72 transferring the business, assets of the business, or stock of
73 goods of the business to a transferee, must file a final return
74 for the business and make full payment of all taxes arising from
75 the operation of that business within 15 days after quitting the
76 business. A taxpayer who fails to file a final return and make
77 payment may not engage in any business in this state until the
78 final return has been filed and all taxes, interest, or
79 penalties due have been paid. The Department of Legal Affairs
80 may seek an injunction at the request of the department to
81 prevent further business activity of a taxpayer who fails to
82 file a final return and make payment of the taxes associated
83 with the operation of the business until such taxes tax,
84 interest, or penalties are paid. A temporary injunction
85 enjoining further business activity shall may be granted by a
86 circuit court if the taxpayer fails to file the final return and
87 make payment of any taxes owed and if the department provided at
88 least 20 days’ written notice to the taxpayer of its intention
89 to seek an injunction without notice.
90 (3) A taxpayer who is liable for taxes with respect to a
91 business and, interest, or penalties levied under chapter 443 or
92 any of the chapters specified in s. 213.05, excluding corporate
93 income tax, who transfers the taxpayer’s business, assets of the
94 business, or stock of goods of the business, must file a final
95 return and make full payment within 15 days after the date of
96 transfer.
97 (4)(a) A transferee, or a group of transferees acting in
98 concert, of more than 50 percent of a business, assets of a
99 business, or stock of goods of a business is liable for any
100 unpaid tax, interest, or penalties owed by the transferor
101 arising from the operation of that business unless:
102 1.a. The transferor provides a receipt or certificate of
103 compliance from the department to the transferee showing that
104 the transferor has not received a notice of audit and the
105 transferor has filed all required tax returns and has paid all
106 tax arising is not liable for taxes, interest, or penalties from
107 the operation of the business identified on the returns filed;
108 and
109 b. There were no insiders in common between the transferor
110 and the transferee at the time of the transfer; or and
111 2. The department finds that the transferor is not liable
112 for taxes, interest, or penalties after an audit of the
113 transferor’s books and records. The audit may be requested by
114 the transferee or the transferor and, if not done pursuant to
115 the certified audit program under s. 213.285, must be completed
116 by the department within 90 days after the records are made
117 available to the department. The department may charge a fee for
118 the cost of the audit if it has not issued a notice of intent to
119 audit by the time the request for the audit is received.
120 (b) A transferee may withhold a portion of the
121 consideration for a business, assets of a business, or stock of
122 goods of a business to pay the tax taxes, interest, or penalties
123 owed to the state by the transferor taxpayer arising from the
124 operation of the business. The transferee shall pay the withheld
125 consideration to the state within 30 days after the date of the
126 transfer. If the consideration withheld is less than the
127 transferor’s liability, the transferor remains liable for the
128 deficiency.
129 (c) A transferee who acquires the business or stock of
130 goods and fails to pay the taxes, interest, or penalties due may
131 not engage in any business in the state until the taxes,
132 interest, or penalties are paid. The Department of Legal Affairs
133 may seek an injunction at the request of the department to
134 prevent further business activity of a transferee who is liable
135 for unpaid tax of a transferor and who fails to pay or cause to
136 be paid the transferee’s maximum liability for such tax due
137 until such maximum liability for the tax is, interest, or
138 penalties are paid. A temporary injunction enjoining further
139 business activity shall may be granted by a circuit court if:
140 1. The assessment against the transferee is final and:
141 a. The time for filing a contest under s. 72.011 has
142 expired; or
143 b. Any contest filed pursuant to s. 72.011 resulted in a
144 final and nonappealable judgment sustaining any part of the
145 assessment; and
146 2. The department has provided at least 20 days’ prior
147 written notice to the transferee of its intention to seek an
148 injunction without notice.
149 (5) The transferee, or transferees acting in concert, of
150 more than 50 percent of a business, assets of a business, or
151 stock of goods of a business who are liable for any tax pursuant
152 to this section are jointly and severally liable with the
153 transferor for the payment of the tax taxes, interest, or
154 penalties owed to the state from the operation of the business
155 by the transferor up to the transferee’s or transferees’ maximum
156 liability for such tax due.
157 (6) The maximum liability of a transferee pursuant to this
158 section is equal to the fair market value of the business,
159 assets of the business, or stock of goods of the business
160 property transferred to the transferee or the total purchase
161 price paid by the transferee for the business, assets of the
162 business, or stock of goods of the business, whichever is
163 greater.
164 (a) The fair market value must be determined net of any
165 liens or liabilities, with the exception of liens or liabilities
166 owed to insiders.
167 (b) The total purchase price must be determined net of
168 liens and liabilities against the assets, with the exception of:
169 1. Liens or liabilities owed to insiders.
170 2. Liens or liabilities assumed by the transferee which are
171 not liens or liabilities owed to insiders.
172 (7) After notice by the department of transferee liability
173 under this section, the transferee has 60 days within which to
174 file an action as provided in chapter 72.
175 (8) This section does not impose liability on a transferee
176 of a business, assets of a business, or stock of goods of a
177 business pursuant to an involuntary transfer.
178 (9) The department may adopt rules necessary to administer
179 and enforce this section.
180
181 ================= T I T L E A M E N D M E N T ================
182 And the title is amended as follows:
183 Delete lines 27 - 46
184 and insert:
185 the terms “business,” “financial institution,”
186 “insider,” “stock of goods,” and “tax”; redefining the
187 terms “involuntary transfer” and “transfer” for
188 purposes of provisions establishing tax liability
189 following the disposition of a business; requiring
190 that a taxpayer engaged in a business who is liable
191 for any tax arising from the business and who quits
192 the business file a final return with the department
193 within a specified time; requiring a circuit court to
194 grant a temporary injunction to prevent further
195 business activity by a taxpayer who fails to file a
196 final return and remit taxes; requiring the Department
197 of Revenue to provide at least 20 days’ notice before
198 seeking an injunction; providing that a transferee of
199 more than 50 percent of the assets of a business is
200 liable for unpaid tax owed by the transferor; revising
201 conditions under which a transferee is exempt from
202 liability for taxes accrued by the transferor;
203 revising the circumstances under which the Department
204 of Revenue may seek an injunction against a transferee
205 who fails to pay taxes accrued by the transferor;
206 providing circumstances in which a circuit court is
207 required to grant an injunction against a transferee;
208 revising the methodology used to determine the maximum
209 tax liability of a transferee; amending s. 322.142,
210 F.S.; authorizing the