Instructions For Completing The Florida Communications Services Tax Return (Form Dr-700016)

DR-700016N

R. 01/07

Page 22

Note on eligible bad debts: Direct-to-home satellite service

the federal return. Subsequent to processing a return, the

providers may take credits on Schedule III for unpaid balances

Department may require documentation to support bad

or worthless accounts. The credit amount should be reported

debts adjustments.

as a reduction in taxable sales in Column A. The credit must

• Take credit for tax paid to a vendor on services that have

be taken within 12 months after the last day of the calendar

been resold.

year for which the bad debt was charged off on the federal

return. Subsequent to processing a return, the Department

Complete a separate Schedule IV for each applied period that

may require documentation to support bad debts adjustments.

you are adjusting. Make photocopies of Schedule IV as needed.

Use Schedule V to claim multistate tax credits.

Column A - Change in reported taxable sales. Enter the net

change in taxable sales. This is the total of the taxable sales

Column A - Local jurisdiction. Enter the names of the

which are either being added to or deleted from transactions

jurisdiction(s) for which you have adjustments. Attach

previously reported. Report negative amounts in parentheses

additional sheets as needed.

(amount).

State Tax Calculation

Column B - Rate. Enter the appropriate rate for the applied

Column B - Change in reported taxable sales. Enter the

period that you are adjusting.

net change in taxable sales on the line corresponding to the

Column C - Collection allowance adjustment. Collection

appropriate local jurisdiction(s). The net change in taxable

allowance adjustments are required for all transactions that

sales may include a reduction for eligible bad debts. Report

result in a decrease in taxable sales. If Column A (Change

negative amounts in parentheses (amount).

in reported taxable sales) is a decrease (negative number),

Column C - Rate. Enter the appropriate rate for the applied

multiply .0075 by the amount of tax collected and/or accrued

period that you are adjusting.

on the amount in Column A. The result should be entered as

a positive number in Column C. If a collection allowance was

Column D - Collection allowance adjustment. Collection

not taken on the original return or the adjustment results in an

allowance adjustments for state tax are required for

increase in taxable sales, this section does not apply. Enter 0

transactions that result in a decrease in taxable sales for a

(zero) in Column C.

prior applied period. If the original filing was not eligible for a

Column D - Adjustment amount. Subtract Column C from the

collection allowance, or if this schedule is being used to report

an increase in taxable sales for a prior applied period or a

amount of tax collected and/or accrued for sales transactions

change in jurisdiction only (no change in taxable sales), this

reported in Column A. Enter the result here. Report negative

section does not apply. Enter 0 (zero) in Column D.

amounts in parentheses (amount).

If Column B (change in reported taxable sales) is a decrease

Penalty and Interest Calculation

(negative number), the collection allowance must be recouped by

Penalty and interest are due on all adjustments which result in an

one of the following methods. The result should be entered as a

increase in tax due.

positive number in Column D.

• If you are using the DOR database, a database certified by

Column E - Penalty. See “Penalty for late payments” on Page

DOR, or a ZIP+4 database in compliance with s. 202.22,

19 for information on calculating the penalty due.

F.S., multiply .0075 by the tax collected and/or accrued for

sales being decreased in Column B.

Column F - Interest. See “Interest on late payments” on Page

19 for information on calculating the interest due.

• If you are not using the DOR database, a database

certified by DOR, or a ZIP+4 database in compliance with

Column G - Total adjustments. Sum the totals of Columns D,

s. 202.22, F.S., multiply .0025 by the tax collected and/or

E, and F. Enter the result here and on Page 1, Line 10 of the

accrued for sales being decreased in Column B.

return.

Column E - Adjustment amount. Subtract Column D from the

Schedule IV

tax collected and/or accrued for the sales reported in Column

Adjustments

B, and enter the result here.

Local Tax Calculation

Who must complete this schedule?

Column F - Change in reported taxable sales. Enter the net

Communications services providers (except direct-to-home

change in taxable sales for the appropriate jurisdiction(s).

satellite service providers) must use this schedule to:

The net change in taxable sales may include a reduction for

• Report adjustments to previous filing periods. This

eligible bad debts. Report negative amounts in parentheses

schedule must be used to correct state or local tax situsing

(amount).

errors (revenue reported in the wrong jurisdiction) and to

When changes in taxable sales are due to situsing or reporting

adjust amounts reported incorrectly on previous returns.

errors and tax has not been refunded to the customer, use

• Report adjustments in taxable sales due to bad debts. You

the following calculations to determine the change in taxable

may take credits on Schedule IV for unpaid balances or

sales.

worthless accounts. The credit amount should be reported

If you are using the DOR database, a database certified

as a reduction in taxable sales in Column B. The credit

by DOR, or a ZIP+4 database in compliance with s.

must be taken within 12 months after the last day of the

202.22, F.S., adjustments to taxable sales should be made by

calendar year for which the bad debt was charged off on

Instructions For Completing The Florida Communications Services Tax Return (Form Dr-700016) - 2007 Page 5

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