HB 507 2023
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to the federal taxation; creating s. 2
17.45, F.S.; providing definitions; authorizing the 3
Chief Financial Officer to reimburse an owner of a 4
small business attorney fees and costs from the 5
Internal Revenue Service Civil Liability Trust Fund 6
under certain conditions; requiring the Department of 7
Financial Services to certify certain information 8
before such reimbursement; providing that the identity 9
of a small business is not affected by certain 10
changes; requiring the department to adopt rules; 11
creating s. 72.042, F.S.; providing for an action in 12
circuit court for an award of attorney fees and costs, 13
actual damages, and punitive damages when the Internal 14
Revenue Service is found to have committed certain 15
violations; requiring an action brought in circuit 16
court to be filed within a specified period; amending 17
s. 212.134, F.S.; providing definitions; providing 18
that a payment settlement entity is only required to 19
issue a return to certain participating payees; 20
requiring a payment settlement entity to create and 21
maintain certain records; amending s. 655.045, F.S.; 22
requiring a report submitted by a financial 23
institution to the Financial Services Commission to 24
include certain information received from the Internal 25
HB 507 2023
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
Revenue Service; requiring the Office of Financial 26
Regulation to submit an annual report to the 27
commission and Legislature by a specified date; 28
providing an effective date. 29
30
Be It Enacted by the Legislature of the State of Florida: 31
32
Section 1. Section 17.45, Florida Statutes, is created t o 33
read: 34
17.45 Reimbursement for retaliatory taxation proceedings. — 35
(1) As used in this section, the term: 36
(a) "Domiciled in this state" means authorized to do 37
business in this state and located in this state. 38
(b) "Retaliatory" means any proceeding initiated in part 39
to discriminate against or target a taxpayer on the basis of his 40
or her political affiliation, ideology, or beliefs, as 41
determined by the department. 42
(c) "Small business" means any business entity, regardless 43
of corporate structure, tha t is domiciled in this state, that 44
employs 50 or fewer employees, and that generated an average 45
annual gross revenue of $4 million or less per year for the 46
preceding 2 years. 47
(d) "Trust fund" means The Internal Revenue Service Civil 48
Liability Trust Fund created under s. 17.44. 49
(2) Any owner of a small business against which the 50
HB 507 2023
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
Internal Revenue Service initiates proceedings in the United 51
States Tax Court may submit an application to the department for 52
reimbursement of reasonable attorney fees and costs necessarily 53
incurred in the proceedings, provided that all of the following 54
criteria have been satisfied: 55
(a) The small business owner is the prevailing party in a 56
proceeding before the United States Tax Court. 57
(b) The attorney representing the small business owner 58
before the United States Tax Court certifies, in writing, that 59
there is a good faith belief that the proceedings were 60
retaliatory. 61
(c) The application is accompanied by a copy of the 62
attorney's retainer agreement and fee or billing stateme nts for 63
the entire period of representation in the proceedings before 64
the United States Tax Court. 65
(d) The application and accompanying documentation is 66
submitted to the department within 90 days after receipt of a 67
final order or other pleading concludin g the proceedings before 68
the United States Tax Court. 69
(e) The small business owner has not been previously 70
awarded attorney fees or costs related to the proceedings before 71
the United States Tax Court. 72
(3) If the criteria in subsection (2) are met, the 73
department shall certify the amount of the reimbursement and the 74
name of the applicant to the Chief Financial Officer, who shall 75
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
reimburse the applicant from the trust fund. 76
(4) For purposes of this sec tion, the identity of a small 77
business is not affected by a change in name or by a change in 78
personnel. 79
(5) The department shall adopt rules to implement this 80
section. 81
Section 2. Section 72.042, Florida Statutes, is created to 82
read: 83
72.042 Tax liabilities arising under federal law; 84
jurisdiction of circuit courts. — 85
(1) If, in connection with the collection of federal taxes 86
concerning a taxpayer domiciled in this state, an action is 87
brought in a federal district court of competent jurisdiction 88
against any officer or employee of the Internal Revenue Service, 89
or any independent contractor employed by the Internal Revenue 90
Service, for a violation of: 91
(a) Title VI of the Civil Rights Act of 1964; 92
(b) Title VII of the Civil Rights Act of 1964; 93
(c) Title 26 of the Internal Revenue Code of 1986, as 94
amended; 95
(d) The First Amendment to the United States Constitution; 96
(e) The Fourth Amendment to the United States 97
Constitution; or 98
(f) The Fifth Amendment to the United States Constitution, 99
100
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
the taxpayer may bring an action in circuit court pursuant to 101
subsection (2) or subsection (3). 102
(2) In any action brought in a federal district court of 103
competent jurisdiction pursuant to paragraph (1)(a), paragraph 104
(1)(b), or paragraph (1)(c), upon a finding by t he federal 105
district court that a violation has occurred, the circuit court 106
may award: 107
(a) Actual damages sustained by the taxpayer, which, but 108
for the actions of the Internal Revenue Service, would not have 109
been sustained. 110
(b) Attorney fees and costs. 111
(3) In any action brought in a federal district court of 112
competent jurisdiction pursuant to paragraph (1)(d), paragraph 113
(1)(e), or paragraph (1)(f), upon a finding by the federal 114
district court that a violation has occurred, the circuit court 115
may award: 116
(a) Actual damages sustained by the taxpayer, which, but 117
for the actions of the Internal Revenue Service, would not have 118
been sustained. 119
(b) Punitive damages, provided that the provisions of s. 120
768.72 are met. 121
(c) Attorney fees and costs. 122
(4) Notwithstanding any other provision of law, an action 123
filed in circuit court pursuant to this section must be filed 124
within 2 years after the date the cause of action accrues. 125
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
Section 3. Subsections (1) through (4) of section 212.134, 126
Florida Statutes, are r enumbered as subsections (2) through (5), 127
respectively, present subsections (1) and (2) are amended, and 128
new subsections (1) and (6) are added to that section, to read: 129
212.134 Information returns relating to payment -card and 130
third-party network transact ions.— 131
(1) For purposes of this section, the term: 132
(a) "Participating payee" has the same meaning as in s. 133
6050W of the Internal Revenue Code. 134
(b) "Payment settlement entity" has the same meaning as in 135
s. 6050W of the Internal Revenue Code. 136
(c) "Return" or "information return" means IRS Form 1099 -K 137
required under s. 6050W of the Internal Revenue Code. 138
(d) "Third-party network transactions" has the same 139
meaning as in s. 6050W of the Internal Revenue Code. 140
(2)(1) For each year in which a payment settlement entity, 141
an electronic payment facilitator, or other third party 142
contracted with the payment settlement entity to make payments 143
to settle reportable payment transactions on behalf of the 144
payment settlement entit y must file a return pursuant to s. 145
6050W of the Internal Revenue Code, the entity, the facilitator, 146
or the third party must submit the information in the return to 147
the department by the 30th day after filing the federal return. 148
The format of the informati on returns required must be either a 149
copy of such information returns or a copy of such information 150
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
returns related to participating payees with an address in the 151
state. For purposes of complying with s. 6050W of the Internal 152
Revenue Code, a payment settle ment entity is only required to 153
issue a return to those participating payees with an address in 154
the state whose aggregate transactions for goods and services 155
exceed $600. For purposes of this subsection, the term "payment 156
settlement entity" has the same me aning as provided in s. 6050W 157
of the Internal Revenue Code. 158
(3)(2) All returns reports submitted to the department 159
under this section must be in an electronic format. 160
(6) A payment settlement entity participating in a third -161
party network transaction i nvolving a participating payee with 162
an address in the state must create and maintain records that 163
clearly identify whether a transaction is a transaction for 164
goods or services, or both, if applicable. 165
Section 4. Subsections (3) and (4) of section 655.0 45, 166
Florida Statutes, are renumbered as subsections (4) and (5), 167
respectively, subsection (2) is amended, and a new subsection 168
(3) is added to that section, to read: 169
655.045 Examinations, reports, and internal audits; 170
penalty.— 171
(2)(a) Each state financial institution, subsidiary, or 172
service corporation shall submit a report, at least four times 173
each calendar year, as of such dates as the commission or office 174
determines. The report must include : 175
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
1. The number of inquiries, requests, summons, subpoenas , 176
or other requests for information or records received from the 177
Internal Revenue Service concerning any account holder domiciled 178
in this state. 179
2. Such other information as the commission by rule 180
requires for that type of institution. 181
(b)(a) The office shall levy an administrative fine of up 182
to $100 per day for each day the report is past due, unless it 183
is excused for good cause. 184
(c)(b) For an intentional late filing of the report, the 185
office shall levy an administrative fine of up to $1,000 per day 186
for each day the report is past due. 187
(3) By January 30 of each year, the office shall submit a 188
report that contains the information from the quarterly reports 189
required under subsection (2) to the commission, the President 190
of the Senate, and the Speaker o f the House of Representatives. 191
Section 5. This act shall take effect on the same date 192
that HB 509 or similar legislation takes effect , if such 193
legislation is adopted in the same legislative session or an 194
extension thereof and becomes a law. 195