On May 21, 2021, Florida Governor Ron DeSantis signed into law Florida House Bill 7061. The bill, also known as Florida’s Tax Cut Package, creates a significant amount of savings for both individuals and businesses.
For businesses, this new bill offers some valuable credit opportunities. The Strong Families Tax Credit Program provides corporate income and insurance premium tax credits for monetary donations to charitable organizations that provide services focused on child welfare. Eligible charitable organizations are defined as those that provide services focused on preventing child neglect, assisting absent fathers, assisting parents of children with disabilities, providing books to children, and providing workforce development services to families of children eligible for a federal free or reduced-price meals program. Beginning January 1, 2022, the credit amount is 100% of an eligible monetary contribution made to an eligible charitable organization against taxes due. The credit amount is limited to 90% of the tax due on the return on which the credit is taken. The Department of Revenue may only approve a maximum of $5 million of credits per state fiscal year for this program.
The internship tax credit provides tax relief for Florida businesses that employ and retain student interns, encouraging companies to hire young Floridians attending college in the state. A qualified intern must work a minimum of 30 hours per week and intern for a company that has been in business for a minimum of three years. The bill defines a “student intern” as a person who has completed at least 60 credit hours at either a state university or at a Florida college system institution. Students enrolled at a charter technical career center may also qualify. In addition to working at least 30 hours per week, the intern must also work full time at the qualified business for nine consecutive weeks. The internship tax credit will begin on or after January 1, 2022 and will provide eligible businesses a credit of $2,000 per eligible student intern. Eligible businesses can claim a maximum of $10,000 of credits per year for student interns under this program.
The Brownfields Tax Credit Program provides a one-time increase in funding of $17.5 million for the existing Brownfields Tax Credit Program to fund a backlog of approved credits. This program, administered through the Florida Department of Environmental Protection, incentivizes businesses to clean up and redevelop hazardous sites to protect the state’s environment and economy. Eligible projects include the rehabilitation of dry-cleaning solvent-contaminated sites and brownfield sites in designated brownfield zones. Following the increase in funding, the total amount claimed by all companies may now not exceed a total of $27.5 million in tax credits in fiscal year 2021–2022 and $10 million in tax credits each fiscal year thereafter.
Overall, Florida’s Tax Cut Package provides great opportunities for individuals and businesses to take advantage of the new tax savings programs. Businesses are now incentivized to make charitable contributions, hire interns, and continue to invest in brownfield properties.
TECHNICAL INFORMATION CONTACTS:
Allea Newbold
Principal
Ryan
813.371.0566
allea.newbold@ryan.com
Matt Lowell
Director
Ryan
321.251.2924
matt.lowell@ryan.com
The material presented in this communication is intended to provide general information only and should solely be seen as broad guidance and not directed to the particular facts or circumstances of any individual who may read this publication. No liability is accepted for acts or omissions taken in reliance upon the content of this piece. Before taking (or not taking) any action, readers should seek professional advice specific to their situation from Ryan, LLC or other tax professionals. For additional information about this topic, please contact us at info@ryan.com.