Do you run a business that sells in Florida? Did you pay Florida sales taxes and want to get your money back? Here’s what you need to know.
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This post is provided for general information only. Please confirm the details and circumstances of your unique situation with your tax accountant or other appropriate advisor before taking action.
Florida Sales Taxes for Individuals
Here’s some frequently asked questions about Florida sales taxes that apply to consumers.
Can you deduct sales taxes on your federal income tax return?
Sales taxes are eligible for an itemized deduction on your federal income tax return. You can either deduct your income taxes or the sales tax you paid during the year. Florida residents don’t pay Florida income taxes, but you may have income taxes from other states you worked in.
You can deduct up to $10,000 in combined sales tax (or income tax but not both sales and income tax) plus property tax.
There are two ways to deduct sales tax. You can use whatever gives you the highest deduction or just do what’s easier.
- Save all your receipts and add up the sales tax you paid during the year.
- Use the amount from the IRS Sales Tax Deduction Calculator.
As an example, I entered a married couple with two children earning the median Florida income of $59,227 and living in Tallahassee. The result was a deduction of $921.25.
Do I owe sales tax on online purchases if the company didn’t collect Florida sales tax?
Yes, you are required by law to pay sales tax even if the business doesn’t collect sales tax. You must file an Out-of-State Purchase Return to report your purchases and pay the sales tax due.
Out-of-State Purchase Returns are due on April 1st, July 1st, October 1st, and January 1st for purchases made during the three months before each due date.
How does the back-to-school sales tax holiday work?
Florida typically has a sales tax holiday for a few days during August. During the holiday, designated items are exempt from sales taxes.
Lawmakers pass a law to declare the sales tax holiday each year. Covered items usually include both school supplies and clothing. Computers, printers, and technology items are sometimes included. There are usually dollar limits on individual items (e.g., clothing items can’t cost more than $100 each).
You do not need to be a student to take advantage of the sales tax holiday. Anyone purchasing eligible items during this time will not pay sales tax. Local news organizations and major retailers usually post the current list of items and dollar limits when the legislature passes the tax holiday for the year.
How does the hurricane preparation sales tax holiday work?
The hurricane preparedness sales tax holiday works the same as the school sales tax holiday but for huricane prepardness supplies. It is typically in May or early June each year.
Florida Sales Taxes for Businesses
Here’s some frequently asked questions about Florida sales taxes that apply to businesses. The Florida Department of Revenue also posts a detailed guide for business owners.
When do businesses need to pay sales taxes?
When you need to pay sales taxes depends on your annual sales tax collections.
- More than $1,000: Monthly
- $501-$1,000: Quarterly
- $100-$500: Semi-annually
- $100 or less: Annually
Most new businesses start as quarterly sales tax filers.
Can a business change its reporting period?
FL DOR reviews each business’s reporting period annually. If your sales tax collections change or you were a new business, they will move you to the appropriate period based on the amount of sales tax you collect. If you would like to change your filing frequency sooner, call FL DOR Taxpayer Services at 1-850-488-6800.
You may be able to get an exception to the usually reporting periods under Florida Administrative Code Rule 12A-1.056.
- You have an excessive amount of sales tax collections due to nonrecurring activities. Send a written request to the Florida Department of Revenue, Account Management, P.O. Box 6480, Tallahassee, Florida 32314-6480.
- Your business can’t reasonably file tax returns on the usual time schedule. Send a written request to the Florida Department of Revenue, Return Reconciliation/Sales and Use Tax Unit, Mail Stop 1-5730, 5050 West Tennessee Street, Tallahassee, Florida 32399-0162.
How do you get a sales tax exemption for items you purchase for resale?
If you purchase items for resale, you must obtain a Florida Annual Resale Certificate for Sales Tax. Show this certificate when you make eligible purchases to avoid sales taxes.
Certificates expire on December 31st, and you must obtain a new certificate each year.
You can apply online using Form DR-13.
What do I do if I receive notice of a sales tax audit?
Gather the records requested. If you need assistance, contact a tax accountant.
If you notice errors, do not change your original books but do note the errors separately. Changing your books can make it look like you’re trying to cover up tax evasion. Identifying a problem on your own and paying the taxes you owe may reduce your penalties.
What is the Florida sales tax rate?
The state sales tax rate is 6%. Counties can add an additional surtax. Most counties add 1% or 1.5% for a total sales tax of 7% or 7.5%.
County surtaxes, but not the base state sales tax, are only charged on the first $5,000 of an item’s price in some cases.
What purchases are subject to Florida sales tax?
The following purchases are subject to Florida sales tax.
- Sales of taxable items at retail
- Repairs or alterations of tangible personal property
- Rentals, leases, or licenses to use real property (for example: commercial office space or mini-warehouses)
- Rentals of short-term living accommodations (for example: motel/hotel rooms, beach houses, condominiums, timeshare resorts, vacation houses, or travel parks)
- Rentals or leases of personal property (for example: vehicles, machinery, equipment, or other goods)
- Charges for admission to any place of amusement, sport, or recreation
- Manufacturing or producing goods for retail sales
- Selling service warranty contracts
- Operating vending or amusement machines
- Providing taxable services (for example: investigative and crime protection services, interior nonresidential cleaning services, or nonresidential pest control services)
- Out-of-state businesses selling into Florida that have any number of transactions with total sales over $100,000 in the prior calendar year
- Marketplace providers facilitating remote sales into Florida
Frequently Asked Questions
When software is sold on a physical disk, it is subject to sales tax as tangible property. Software that is sold as a download or cloud subscription with no physical component is not subject to sales tax.