HB 825 Summary

• Adds new subsection (4) to section 212.17, Florida Statutes, establishing procedures for dealers and lenders to claim tax credits or refunds on worthless or uncollectable private-label credit card and dealer credit card accounts or receivables.

• Requires accounts or receivables to be charged off as bad debt on or after January 1, 2013, with no previous credit or refund claimed, and the claim must be filed within 12 months after the month the bad debt is charged off for federal income tax purposes.

• Allows dealers to use either an apportionment method or a specified percentage method derived from sampling to determine the amount of tax included in the bad debt for which credit or refund applies.

• Permits credits or refunds to be claimed on returns filed by related entities with direct or indirect common ownership of 50 percent or more, and specifies that subsequently collected amounts must be included as taxable income with appropriate tax paid.

• Becomes effective July 1, 2013, and defines key terms including "dealer's affiliates," "dealer credit," "lender," and "private-label credit card."