Tax Alert

Florida’s 2011 Tax Changes

(June 24, 2011)

The following highlights summarize Florida’s recently enacted tax law changes.

Communications Services Tax (CST) – Requires communications services dealers to compute state and local CST on a rounding algorithm instead of state-directed bracketing. Those responsible for collecting and remitting this tax should adjust their tax reporting systems effective July 1, 2011.

Corporate Income Tax (CIT) – Effective for tax years beginning on or after Jan. 1, 2011, the Florida CIT code conforms to the Internal Revenue Code (IRC) as amended on Jan. 1, 2011, but continues to decouple from bonus depreciation, IRC Section 179 expensing election, and deferral of cancellation of indebtedness income under IRC Section 108(i).

Approved companies (excluding financial organizations) that incur at least $250 million in qualified capital expenditures within a two-year period beginning no earlier than July 1, 2011, may elect to use a single-sales factor apportionment for tax years beginning on or after Jan. 1, 2013.

Effective for tax years beginning on or after Jan. 1, 2012, Florida provides a corporate income tax credit for research and development expenses incurred for business enterprises in targeted industries. The credit is 10 percent of the excess of the taxpayer’s qualified research expenses in the current year over a base amount.

Sales Tax – Retailers will need to adjust their point-of-sale systems to accommodate a sales tax holiday on the sale of certain clothing and school supplies between Aug. 12 and Aug. 14, 2011.

For more information on how this might affect you, please contact Gary Peric at 813.209.2403, gary.peric@crowehorwath.com, Kenneth Rios at 954.202.8553, ken.rios@crowehorwath.com or Eric de Moya at 813.209.2462, eric.demoya@crowehorwath.com, or any Crowe Horwath LLP tax professional.




Under U.S. Treasury rules issued in 2005, we must inform you that any advice in this communication to you was not intended or written to be used, and cannot be used, to avoid any government penalties that may be imposed on a taxpayer.

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