Page 62 - Akerman | 2016 Guide to Doing Business in Florida

The rules of United States federal income taxation of a limited liability company (“LLC”) generally
depend upon the number of members of the LLC. If an LLC has only one member, absent an
election to be classified as an association taxable as a corporation, its separate existence
generally is disregarded for United States federal income tax purposes, and its member is
treated as if it owns the LLC’s assets and conducts its activities directly. Hence, the LLC is
treated for federal income tax purposes as if it were an unincorporated business or branch
operated by its sole member, and the tax consequences described above with respect to
unincorporated businesses and branches apply. The classification of a single-member LLC as
a disregarded entity applies for United States federal income tax purposes only, and it does not
affect the separation of the legal existence of the LLC from its member.

If an LLC has more than one member, absent an election to be classified as an association
taxable as a corporation, it generally is treated as a partnership for federal income tax purposes,
and the tax consequences described above with respect to partnerships and joint ventures
apply.

5.2 Florida State Taxation
The following is intended to provide a very general overview of the basic Florida state taxation of various
types of taxpayers and common business activities. There are many exceptions and complex special
rules that could apply. Taxpayers are urged to contact a Lex Mundi-affiliated tax advisor regarding the
imposition of Florida state taxes on parties and their business activities.

5.2.1 Florida State Sales and Use Tax
Florida imposes a 6% tax on (i) sales at retail and leases of tangible property, (ii) commercial
leases of real estate, (iii) parking spaces and storage, (iv) transient rentals (hotels and short term
residential leases), (v) admissions, and (vi) tangible personal property used, consumed,
distributed, or stored for use or consumption, but not sold in state. Sales/Use Tax is subject to
numerous statutory exemptions and limitations, including:

a. Groceries,
b. Medical equipment,
c. Sales for resale,
d. Casual sales, and

e. Certain industrial and agricultural equipment.
5.2.2 Discretionary County Sales and Use Surtax

When legislatively authorized, counties may levy surtax on transactions subject to sales, use,
services, rentals, admissions, etc. The surtax on most sales is up to 1.5%, but the surtax on
transient rentals can be up to 7%. In both cases, such county taxes are applied in addition to
the 6% state sales tax.

5.2.3 Communications Services Tax

A communications services tax is levied on sales price of communications services which
originate and terminate in this state or originate and terminate in this state and charged to
service address in this state when sold at retail. The rate of this tax varies depending on local
option taxes imposed.

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