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Effective 1/1/18, the state sales tax rate on the total rent charged for renting, leasing, letting, or granting a license to use commercial real property for rental periods beginning on or after January 1, 2018, is decreased from 6% to 5.8%. The local option discretionary sales surtax imposed by the county where the real property is located continues to apply to the total rent charged.

Some examples of real property rentals subject to tax include commercial office or retail space, warehouses, and self-storage units or mini-warehouses.

Attached is Florida Department of Revenue's notice related to the state rate reduction, a sample of Form DR-15 reporting and the discretionary sales surtax chart which lists the rates by County.

Please contact Hafer professionals to answer any questions you may have or to assist you in filing this sales and use tax return. Nicole Johnson-Pendergrass is the firm's director of operations and can be reached via email at Njohnson@haferco.com. You can also reach us at our office number (561) 655-8700.

Click here to download a sample of Form DR-15

On September 29, 2017, the President signed into law the Disaster Tax Relief and Airport and Airway Extension Act of 2017. The Act provides some temporary tax relief to the victims of Hurricanes Harvey, Irma, and Maria.

One of the key benefits is that businesses in the stricken areas that qualify for relief may claim a new Employee Retention Tax Credit up to $2,400 per employee for qualified wages paid to eligible employees during the period in which the business was inoperable due to the hurricane.

Here’s how it works:

• An eligible employer is one who conducted an active trade or business in a disaster zone as of a specified date (for Hurricane Harvey, August 23, 2017; Irma, September 4, 2017; and Maria, September 16, 2017) and was unable to carry on their business due to the damage sustained by the hurricane, between the dates of the hurricane and January 1, 2018, is eligible to claim the tax credit.
• The credit is 40% of the first $6,000 in wages paid to each eligible employee during the period the business was inoperable. The employer cannot take a deduction for the wages paid and the tax credit; it’s either/or.
• The eligible employee is domiciled and worked for the employer in the disaster zone(s) listed above.
• Qualified wages are defined as paid or incurred based on the specified date (above) when the business first became inoperable and ends on the date in which the business resumes significant operations or January 1, 2018, whichever is earlier.
• The credit is claimed on Form 3800 – General Business Credits, and for those pass-through entities (partnerships and “S” Corps) is claimed in Part III of Form 3800. The credit is a non- refundable tax credit and can be carried forward 20 years.

Generally, it’s more advantageous to claim a tax credit since it will reduce your tax liability dollar for dollar, versus a tax deduction (i.e. wage deduction), which is tax effected at the applicable tax rate or tax bracket.

Please contact Hafer professionals to answer any questions you may have or to assist you in determining and filing for this tax credit or any hurricane-related losses. Nicole Johnson-Pendergrass is the Firm’s Director of Operations and can be reached via email at Njohnson@haferco.com or at (561) 655-8700.

Click here to download this document.

The Internal Revenue Service announced some key tax relief provisions to the victims of Hurricanes Harvey, Irma, and Maria.

The IRS is providing temporary relief by postponing various tax deadlines that will allow individuals and businesses until January 31, 2018 to file any returns and pay any taxes due. Those eligible for the extra time include:

• Individual Form 1040 filers whose tax extension would run out on October 16, 2017, will now have until January 31, 2018 to file their 2016 Form 1040. It does, however, exclude relief for any additional tax due with their 2016 tax return.
• Business filers, such as calendar-year partnerships (Form 1065), or “S” Corporations (Form 1120-S) whose extensions ran out on September 15, 2017.
• Quarterly estimated tax payments due on September 15, 2017 and January 16, 2018.
• Quarterly payroll and excise tax returns due on October 31, 2017.
• Calendar-year tax-exempt organizations whose 2016 extensions run out on November 15, 2017.

A variety of other returns, payments, and tax-related actions also qualify for additional time. See the disaster relief page on IRS.gov for more details. The IRS also continues to closely monitor the aftermath of these storms, and additional updates for taxpayers will be posted to IRS.gov.

The IRS offers other special assistance to disaster-area taxpayers. This includes the following:

• Special relief helps employer-sponsored leave-based donation programs aid hurricane victims. Under these programs, employees may forgo their vacation, sick or personal leave in exchange for cash payments the employer makes, before January 1, 2019, to charities providing relief. Donated leave is not included in the employee’s income, and employers may deduct these cash payments to charity as a business expense.
• 401(k)s and similar employer-sponsored retirement plans can make loans and hardship distributions to hurricane victims and members of their families. Under this broad-based relief, a retirement plan can allow a hurricane victim to take a hardship distribution or borrow up to the specified statutory limits from the victim’s retirement plan. It also means that a person who lives outside the disaster area can take out a retirement plan loan or hardship distribution and use it to assist a son, daughter, parent, grandparent or dependent who lived or worked in the disaster area. Hardship withdrawals must be made by January 31, 2018.
• The IRS is waiving late-deposit penalties for federal payroll and excise tax deposits normally due during the first 15 days of the disaster period. Check out the disaster relief page for the time periods that apply to each jurisdiction.
• Individuals and businesses who suffered uninsured or unreimbursed disaster-related losses can choose to claim them on either the return for the year the loss occurred (in this instance, the 2017 return normally filed next year), or the return for the prior year (2016).
• The IRS is waiving the usual fees and expediting requests for copies of previously filed tax returns for disaster area taxpayers. This relief can be especially helpful to anyone whose copies of these documents were lost or destroyed by the hurricane.
• If disaster-area taxpayers are contacted by the IRS on a collection or examination matter, they should be sure to explain how the disaster impacts them so that the IRS can provide appropriate consideration to their case.

Please contact HAFER professionals to answer any questions you may have or to assist you in determining and filing for any hurricane-related losses. Nicole Johnson-Pendergrass is the Firm’s Director of Operations and can be reached via email at Njohnson@haferco.com or at (561) 655-8700.

Click here to download this document.

Legislation (S.B. 4C) was enacted that:

• Extends the due dates for payment of Florida property taxes levied in 2022 for property owners whose property was destroyed or rendered uninhabitable by Hurricanes Ian or Nicole. It extends the early payment discount of 4% for the months of November 2022, December 2022, and January 2023. The discount is now 3% in February 2023, 2% in March 2023, and 1% in April 2023.
• Authorizes property tax refunds for residential properties that were made uninhabitable for at least 30 days by either hurricane for the portion of the year that the residence was unusable. The property owner must file an application for refund with the property appraisers between January 1st, 2023, and no later than April 1st, 2023. The application must be accompanied by supporting documentation – utility bills, insurance information, contractor’s statements, building permit applications, and building inspection certificates of occupancy.
• "Uninhabitable" is defined as the loss of use and occupancy of a residential improvement for the purpose for which it was constructed resulting from damage to or destruction of, or from a condition that compromises the structural integrity of, the residential improvement which was caused by Hurricane Ian or Hurricane Nicole during the 2022 calendar year.

Click here to download this document.