TAA 21A-009 Refund

QUESTION: Would Taxpayer’s closure of its sales and use tax dealer account with the Department impede its right or cause it to lose its right to obtain a refund for sales tax later if it were, otherwise, entitled to one at the time it filed its application for refund. 

ANSWER: No. 

June 30, 2021

Technical Assistance Advisement No. 21A-009

Sales and Use Tax – Refunds

XXXXXXXX (“Taxpayer”)

FEI No. XXXXXXXX

BPN: XXXXXXXX

Section 215.26, Florida Statutes (“F.S.”)

Rules 12A-1.014, and 12-26.003, Florida Administrative Code (“F.A.C.”)

Dear XXXXXXXX: 

This letter is a response to your petition on behalf of XXXXXXXX, for the Florida Department of Revenue’s (the “Department’s”) issuance of a Technical Assistance Advisement ("TAA") with regard to whether Taxpayer’s closure of its sales and use dealer tax account with the Department would cause it to lose its right to a refund if it were, otherwise, entitled to one. Your petition has been carefully examined and the Department finds it to be in compliance with the requisite criteria set forth in Chapter 12-11, Florida Administrative Code. This response to your request constitutes a TAA and is issued to you under the authority of s. 213.22, F.S.

Requested Advisement 

Whether Taxpayer’s closure of its sales and use tax dealer account with the Department would impede Taxpayer’s right or cause Taxpayer to lose its right to obtain a refund for sales tax later if it were, otherwise, entitled to one at the time it filed its application for refund.

Facts As Provided 

On April 21, 2021, XXXXXXXX sent a request, on behalf of Taxpayer, for a Technical Advisement Memorandum. This was interpreted as a request for a Letter of Technical Assistance. In a conversation with XXXXXXXX, this conferee asked if he was wanting a binding opinion and he responded that he was. On April 23, 2021, XXXXXXXX sent an e-mail to the Department requesting that a Technical Assistance Advisement be issued in response to his question. His request was converted into a request for a Technical Assistance Advisement. 

Taxpayer discontinued its business operations in Florida on October 31, 2020. While Taxpayer was still conducting business, Taxpayer collected some sales tax from its customers in error and remitted the tax to the Department in error. Taxpayer intends to refund the erroneously-collected tax to its customers and then seek a refund for the erroneously-remitted tax from the Department. Taxpayer would like to close its sales and use dealer tax account with the Department at this time and seek a refund at a later time, but XXXXXXXX wants to be sure that doing so would not jeopardize Taxpayer’s right to obtain a refund if it were, otherwise, entitled to one at the time it filed the application for refund.

Applicable Law and Discussion 

With regards to refunds for sales tax remitted to the Department in error, there are requirements in the statutes and administrative rules pertaining to such things as what refunds may be granted for (e.g., overpayment of tax and payment made to the Department in error), the time period in which refund applications must be filed, and information that must be included in the application for refund. See s. 215.26(1) and (2), F.S.; Rule 12-26.003(4), F.A.C. However, there is nothing in the law which states that a taxpayer’s closing its sales and use tax dealer account with the Department would preclude its right to obtain a sales tax refund as long as it was, otherwise, entitled to such a refund at the time it filed its application for refund. This statement assumes that this taxpayer would follow all the provisions in section 215.26, F.S., and Rules 12A-1.014, FA.C., and 12-26.003(3)(f) and (4), F.A.C., related to obtaining refunds. Taxpayer should note that applications for refunds must be filed with the Department “within 3 years after the right to the refund has accrued or else the right is barred.” See s. 215.26(2), F.S. If Taxpayer charged a customer tax erroneously on a sale that occurred on September 7, 2019, and refunded the tax to the customer on June 30, 2021, for example, September 7, 2019, would be the date that the right to the refund accrued.

Conclusion 

If Taxpayer decides to close its sales and use tax dealer account with the Department at this time, this action would not impede Taxpayer’s right or cause Taxpayer to lose its right to obtain a refund for sales tax later if it were, otherwise, entitled to one at the time it filed its application for refund. 1*

This response constitutes a Technical Assistance Advisement under section 213.22, F.S., which is binding on the Department only under the facts and circumstances described in the request for this advice as specified in section 213.22, F.S. Our response is predicated on those facts and the specific situation summarized above. You are advised that subsequent statutory or administrative rule changes, or judicial interpretations of the statutes or rules, upon which this advice is based, may subject similar future transactions to a different treatment than that expressed in this response. You are further advised that this response, your request and related backup documents are public records under Chapter 119, F.S., and are subject to disclosure to the public under the conditions of section 213.22, F.S. Confidential information must be deleted before public disclosure. In an effort to protect confidentiality, we request you provide the undersigned with an edited copy of your request for Technical Assistance Advisement, the backup material, and this response, deleting names, addresses, and any other details which might lead to identification of the taxpayer. Your response should be received by the Department within 15 days of the date of this letter.

Katharine Heyward 

Senior Attorney 

Technical Assistance & Dispute Resolution

(1) Note that applications for refund that are not properly completed will not be considered filed for the purpose of tolling the statutory provisions of Section 215.26, F.S., or for the purpose of the payment of interest under the conditions prescribed in Sections 213.235 and 213.255, F.S. See Rule 12-26.003(4), F.A.C.