February 28, 2022

Bill Summary: CS/SB 1090

Overview

Florida imposes a 5.5 percent tax on the taxable income of corporations and financial institutions doing business in Florida. However, over 90 percent of corporations owe zero corporate income tax (CIT).To calculate CIT due, the Sunshine State uses federal taxable income as a starting point and then modifies it by applying state-based additions, subtractions, and other adjustments. Since Florida uses federal taxable income as a starting point, the state tax code maintains a relationship with the federal Internal Revenue Code (IRC) by piggybacking the IRC as it exists on January 1 of the year. Since Florida does not have to build an entirely different tax code from scratch, piggybacking leads to substantial administrative savings, uniformity, and reductions in compliance costs. However, sometimes state policymakers choose to decouple or throw out specific tax provisions in the IRC.

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Generating Revenue and Building Tax Fairness

Pushing for tax code reform to fix Florida's "upside-down" tax system

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