Section 1, Chapter 2011-223, L.O.F., allows certain unused capital investment tax credits to be carried forward through the 30th tax year after commencement of operations. The proposed amendments to Rule 12C-1.0191, F.A.C. (Capital Investment Tax ...

 

DEPARTMENT OF REVENUE
Corporate, Estate and Intangible Tax

RULE NO.: RULE TITLE:
12C-1.0191: Capital Investment Tax Credit Program
12C-1.0193: Florida Renewable Energy Production Credit
12C-1.0221: Returns, Notices, and Elections; Signing and Verification
12C-1.051: Forms

PURPOSE AND EFFECT: Section 1, Chapter 2011-223, L.O.F., allows certain unused capital investment tax credits to be carried forward through the 30th tax year after commencement of operations. The proposed amendments to Rule 12C-1.0191, F.A.C. (Capital Investment Tax Credit Program), are necessary to include this provision in the rule.

Section 7, Chapter 2012-117, L.O.F., effective July 1, 2012, requires an application to be filed with the Department of Agriculture and Consumer Services for an allocation of an annual tax credit against corporate income tax based on the taxpayer’s production and sale of electricity from a Florida renewable energy facility. The proposed amendments to Rule 12C-1.0193, F.A.C. (Florida Renewable Energy Production Credit), and to Rule 12C-1.051, F.A.C. (Forms), are necessary to: (1) update the Department’s rules to include the provisions of Section 7, Chapter 2012-117, L.O.F., and provide that applications for the credit will be filed with the Department of Agriculture and Consumer Services; and (2) remove the obsolete application for the tax credit previously submitted to the Department of Revenue.

The proposed amendments to Rule 12C-1.0221, F.A.C. (Returns, Notices, and Elections; Signing and Verification), are necessary to adopt, by reference, updates to Treasury Department Circular Number 230.

SUMMARY: The proposed amendments to Rule 12C-1.0191, F.A.C. (Capital Investment Tax Credit Program), provide when unused capital investment tax credits may be carried forward through the 30th tax year after commencement of operations.

The proposed amendments to Rule 12C-1.0193, F.A.C. (Florida Renewable Energy Production Credit): (1) update the Department’s rules to reflect the changes provided in Section 7, Chapter 2012-117, L.O.F., which require that applications for the credit be filed with the Department of Agriculture and Consumer Services; and (2) remove the obsolete application for the tax credit previously submitted to the Department of Revenue.

The proposed amendments to Rule 12C-1.0221, F.A.C. (Returns, Notices, and Elections; Signing and Verification), adopt, by reference, updated Treasury Department Circular Number 230.

The proposed amendments to Rule 12C-1.051, F.A.C. (Forms): (1) remove the obsolete application for the Florida Renewable Energy Production Credit; (2) adopt, by reference, updates to the form used for notifying the Department of Revenue of a transfer of a Florida Energy Tax Credit; and (3) adopt, by reference, updates to Florida corporate income tax returns and instructions.

SUMMARY OF STATEMENT OF ESTIMATED REGULATORY COSTS AND LEGISLATIVE RATIFICATION:

The Agency has determined that this will not have an adverse impact on small business or likely increase directly or indirectly regulatory costs in excess of $200,000 in the aggregate within one year after the implementation of the rule. A SERC has not been prepared by the agency.

The Agency has determined that the proposed rule is not expected to require legislative ratification based on the statement of estimated regulatory costs or if no SERC is required, the information expressly relied upon and described herein: 1) no requirement for the Statement of Economic Regulatory Costs (SERC) was triggered under Section 120.541(1), F.S.; and 2) based on past experiences with activities for the administration of the corporate income tax credits, and rules of this nature, the adverse impact or regulatory cost, if any, do not exceed nor would exceed any one of the economic analysis criteria in a SERC, as set forth in Section 120.541(2)(a), F.S.

Any person who wishes to provide information regarding a statement of estimated regulatory costs, or provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.

RULEMAKING AUTHORITY: 213.06(1), 220.191(8), 220.192(5), (7), 220.193, 220.196(4), 220.51, 1002.395(13) FS.
LAW IMPLEMENTED: 119.071(5), 212.08(5)(p), 213.35, 213.755, 220.02(3), (8), 220.03(1), 220.11, 220.12, 220.13(1), (2), 220.131, 220.14, 220.15, 220.16, 220.181, 220.182, 220.183, 220.184, 220.1845, 220.185, 220.186, 220.1875, 220.1895, 220.1896, 220.19, 220.191, 220.192, 220.193, 220.196, 220.21, 220.211, 220.22, 220.221, 220.222, 220.23, 220.24, 220.241, 220.31, 220.32, 220.33, 220.34, 220.41, 220.42, 220.43, 220.44, 220.51, 220.721, 220.723, 220.725, 220.737, 220.801, 220.803, 220.805, 220.807, 220.809, 221.04, 624.5105, 624.51055, 1002.395 FS.

A HEARING WILL BE HELD AT THE DATE, TIME AND PLACE SHOWN BELOW:

DATE AND TIME: October 24, 2012, 10:00 a.m.

PLACE: 2450 Shumard Oak Boulevard, Building One, Room 1820, Tallahassee, Florida

Pursuant to the provisions of the Americans with Disabilities Act, any person requiring special accommodations to participate in this workshop/meeting is asked to advise the agency at least 48 hours before the workshop/meeting by contacting: Tammy Miller at [phone]. If you are hearing or speech impaired, please contact the agency using the Florida Relay Service, 1(800)955-8771 (TDD) or 1(800)955-8770 (Voice).

THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULES IS: Jennifer Ensley, Tax Law Specialist, Technical Assistance and Dispute Resolution, Department of Revenue, P. O. Box 7443, Tallahassee, Florida 32314-7443, telephone [phone]

 

THE FULL TEXT OF THE PROPOSED RULES IS:

12C-1.0191 Capital Investment Tax Credit Program.

(1)(a) No change.

(b)1. The maximum annual amount of Capital Investment Tax Credit is limited to 5 percent of the certified eligible capital costs of the qualifying project, for a period not to exceed 20 years, beginning with the commencement of the project’s operations. The tax credit may not be carried forward or backward, except as noted in subparagraph 2. The sum of all capital investment tax credits cannot exceed 100 percent of the eligible capital costs of the project.

2. A carryover of credit is available for a qualifying business that invested at least $100 million and is eligible to claim the credit against 100 percent of its corporate income tax liability pursuant to Section 220.191(2)(a)1., F.S. Unused credits from the 20-year credit period may be claimed in the 21st through 30th tax years after commencement of operations of such qualifying business, as long as the unused amount results from an insufficient tax liability on the part of the qualifying business.

(2) through (6) No change.

Rulemaking Authority 213.06(1), 220.191(8), 220.51 FS. Law Implemented 220.191 FS. History–New 8-4-05, Amended 4-5-07, 4-26-10,________.

 

12C-1.0193 Florida Renewable Energy Production Credit.

(1) A Florida Renewable Energy Production Credit is provided in Section 220.193, F.S., for the sale of electricity from a new Florida renewable energy facility operationally placed in service after May 1, 2006, and for increases of more than five percent (5%) in the production and sale of electricity from renewable energy sources at an existing Florida renewable energy facility. The terms “sale” and “sold” include the use of electricity by the producer of such electricity from renewable sources if such use reduces the amount of electricity that the producer would otherwise have to purchase. To claim the credit, An application an Application for Florida Renewable Energy Production Credit Allocation (Form F-1193, incorporated by reference in Rule 12C-1.051, F.A.C.), must be filed with the Department of Agriculture and Consumer Services on or before February 1 of each year for an allocation of credit. The allocation of credit is based upon the applicant’s increased production and sales of electricity and the increased production and sales of all applicants. On or before March 1 of each year, the Department of Agriculture and Consumer Services will notify eligible taxpayers by letter of the certified amount of credit that is allocated to them and the tax year in which the taxpayer may claim the credit on its Florida corporate income tax return. A copy of the certification this letter must be attached to the taxpayer’s Florida corporate income tax return on which the credit is taken.

(2) Taxpayers that increase both production and sales of renewable electrical energy by more than five percent (5%) over the 2005 calendar year for each expanded Florida renewable energy facility may submit one application each year for each qualifying facility. For a new Florida renewable energy facility, the credit is based on the taxpayer’s sale of the facility’s entire electrical production. A taxpayer may not transfer its right to apply for a credit to another taxpayer. Florida Renewable Energy Production credits may only be taken once against the Florida corporate income tax, may not be carried back to an earlier tax year, and must be taken in the order prescribed in Section 220.02(8), F.S. A taxpayer claiming the credit on its Florida corporate income tax return must add back the amount of the credit to its Florida net income. Credit amounts that are not granted in full or in part due to the annual $5 million limitation are not eligible for a Florida Renewable Energy Production credit in later years.

(2)(3) The Florida Renewable Energy Production Credit may be transferred in a merger or acquisition. In addition, unused credits may be transferred one time (outside a merger or acquisition) to another taxpayer in whole or in increments of not less than 25 percent of the remaining credit. Taxpayers are required to file a Notice of Intent to Transfer A Florida Energy Tax Credit (Form F-1193T, incorporated by reference in Rule 12C-1.051, F.A.C.) to transfer the unused renewable energy production credits available for transfer. The transfer must be verified by the Department prior to the transferee claiming the credit. Within 15 days of receipt of a completed Form F-1193T, the Department will notify the transferor and the transferee by letter of the amount of tax credit authorized for transfer. A copy of the letter from the Department allowing the transfer must be attached by the transferee to the Florida Corporate Income/Franchise and Emergency Excise Tax Return (Form F-1120, incorporated by reference in Rule 12C-1.051, F.A.C.) on which the credit is claimed. The transfer of a credit does not affect the time for taking the credit, and the credit is subject to the same limitations imposed on the transferor.

(3)(4) Every taxpayer claiming a Florida Renewable Energy Production Credit must retain documentation that substantiates and supports the credit, a copy of the certification letter received from the Department of Agriculture and Consumer Services certifying the amount of granting the credit, a schedule reconciling all credit carryovers, transfers, and sales, a schedule tracking the credit amounts allocated and the use of such credits, and, if applicable a copy of the letter from the Department allowing the transfer until tax imposed by Chapter 220, F.S., may no longer be determined and assessed under Section 95.091(3), F.S. Documentation to substantiate and support the credit includes: production records or other evidence of the amount of electricity produced; evidence of the increase in production and sales of electricity over the 2011 2005 calendar year by an expanded facility; and evidence establishing that the electricity was produced from renewable energy.

Rulemaking Authority 213.06(1), 220.193, 220.51 FS. Law Implemented 213.35, 220.02(8), 220.03(1), 220.131, 220.193, 220.21 FS. History–New 4-26-10, Amended________.

 

12C-1.0221 Returns, Notices, and Elections; Signing and Verification.

(1)(a) through (b) No change.

(c) Form F-7004 shall be signed by a person authorized by the taxpayer to request such extension. Such person must be an individual authorized under paragraph (a) or (b) to sign the taxpayer’s return; a person currently enrolled as an agent under Treasury Department Circular Number 230 (Rev. 8-2011 6-2005, herein incorporated by reference, Effective ___ 01/08) to practice before the Internal Revenue Service; an attorney who is a member in good standing of the bar of the highest court of any state, possession, territory, commonwealth, or the District of Columbia; or any certified public accountant who is duly qualified to practice in any state, possession, territory, commonwealth, or the District of Columbia.

(d) through (e) No change.

(2) through (5) No change.

Rulemaking Authority 213.06(1), 220.51 FS. Law Implemented 213.755, 220.221, 220.23(2)(a) FS. History–New 3-5-80, Amended 12-18-83, Formerly 12C-1.221, Amended 12-21-88, 4-8-92, 1-28-08, 4-26-10,_________.

 

12C-1.051 Forms.

(1)(a) The following forms and instructions are used by the Department in its administration of the corporate income tax and franchise tax. These forms are hereby incorporated by reference in this rule.

(b) No change.

Form Number TitleEffective Date

(2) F-851Corporate Income/Franchise and Emergency Excise Tax

Affiliations Schedule (R. 01/13 01/10)___ 01/10

(3)(a) F-1065Florida Partnership Information Return (R. 01/13 01/12)___ 01/12

(http://www.flrules.org/Gateway/reference.asp?No=Ref-___ 00831)

(b) F-1065NInstructions for Preparing Form F-1065 Florida Partnership

Information Return (R. 01/13 01/12)___ 01/12

(http://www.flrules.org/Gateway/reference.asp?No=Ref-___ 00832)

(4) F-1120AFlorida Corporate Short Form Income Tax Return (R. 01/13 01/12)___ 01/12

(http://www.flrules.org/Gateway/reference.asp?No=Ref-___ 00833)

(5)(a) F-1120Florida Corporate Income/Franchise and Emergency Excise

Tax Return (R. 01/13 01/12)___ 01/12

(http://www.flrules.org/Gateway/reference.asp?No=Ref-___ 00834)

(b) F-1120NF-1120 Instructions – Corporate Income/Franchise And Emergency

Excise Tax Return for taxable years beginning on or after

January 1, 2012 2011 (R. 01/13 01/12)___ 01/12

(http://www.flrules.org/Gateway/reference.asp?No=Ref-___ 00835)

(6) F-1120ESDeclaration/Installment of Florida Estimated Income/

Franchise Tax For Taxable Year Beginning on or after

January 1, 2013 2012 (R. 01/13 01/12) ___ 01/12

(http://www.flrules.org/Gateway/reference.asp?No=Ref-___ 00836)

(7)(a) F-1120XAmended Florida Corporate Income/Franchise

and Emergency Excise Tax Return (R. 01/13 01/10) ___ 01/10

(b) F-1120XNInstructions for Preparing Form F-1120X Amended Florida Corporate

Income/Franchise and Emergency Excise Tax Return (R. 01/13 01/10)___ 01/10

(8) F-1122Authorization and Consent of Subsidiary Corporation to be

Included in a Consolidated Income and Emergency Excise

Tax Return (R. 01/13 01/09)___ 01/09

(9) through (10) No change.

(11)(a) F-1193Application for Florida Renewable Energy Production Credit

Allocation (R. 01/11)01/11

(b) F-1193TNotice of Intent to Transfer A Florida Energy Tax Credit (R. 07/12 01/12)___ 01/12

(http://www.flrules.org/Gateway/reference.asp?No=Ref-___ 00837)

(12) F-2220Underpayment of Estimated Tax on Florida Corporate Income/Franchise

and Emergency Excise Tax (R. 01/13 01/09)___ 01/09

(13) F-7004Florida Tentative Income/Franchise and Emergency Excise Tax Return

and Application for Extension of Time to File Return (R. 01/13 01/12)___ 01/12

(http://www.flrules.org/Gateway/reference.asp?No=Ref-___ 00838)

Rulemaking Authority 213.06(1), 220.192(7), 220.193(4), 220.196(4), 220.51, 1002.395(13) FS. Law Implemented 119.071(5), 212.08(5)(p), 213.755(1), 220.11, 220.12, 220.13(1), (2), 220.14, 220.15, 220.16, 220.181, 220.182, 220.183, 220.184, 220.1845, 220.185, 220.186, 220.1875, 220.1895, 220.1896, 220.1899, 220.19, 220.191, 220.192, 220.193, 220.194, 220.195, 220.196, 220.21, 220.211, 220.22, 220.221, 220.222, 220.23, 220.24, 220.241, 220.31, 220.32, 220.33, 220.34, 220.41, 220.42, 220.43, 220.44, 220.51, 220.721, 220.723, 220.725, 220.737, 220.801, 220.803, 220.805, 220.807, 220.809, 221.04, 624.5105, 624.51055, 1002.395 FS. History–New 9-26-77, Amended 12-18-83, Formerly 12C-1.51, Amended 12-21-88, 12-31-89, 1-31-91, 4-8-92, 12-7-92, 1-3-96, 3-18-96, 3-13-00, 6-19-01, 8-1-02, 6-19-03, 3-15-04, 9-24-04, 6-28-05, 5-1-06, 4-5-07, 1-1-08, 1-27-09, 1-11-10, 4-26-10(12)(a),(b), 4-26-10(13)(a),(b), 6-28-10, 1-12-11, 6-6-11, 1-25-12,________.

 

NAME OF PERSON ORIGINATING PROPOSED RULE: Jennifer Ensley, Tax Law Specialist, Technical Assistance and Dispute Resolution, Department of Revenue, P. O. Box 7443, Tallahassee, Florida 32314-7443, telephone [phone]

NAME OF AGENCY HEAD WHO APPROVED THE PROPOSED RULE: Governor and Cabinet

DATE PROPOSED RULE APPROVED BY AGENCY HEAD: September 18, 2012

DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAW: A Notice of Proposed Rule Development was published in the Florida Administrative Weekly on July 20, 2012 (Vol. 38, No. 29, p. 2910), to advise the public of the proposed changes to Rule Chapter 12C-1, F.A.C. (Corporate Income Tax), and to provide that, if requested in writing, a rule development workshop would be held on August 8, 2012. No request was received by the Department. No written comments were received by the Department.