CHAPTER 2026-137 House Bill No. 7031 An act relating to the Internal Revenue Code; amending s. 220.03, F.S.; revising the definition of the term “Internal Revenue Code”; amending s. 220.13, F.S.; conforming provisions to changes made by the act; providing for retroactive application; requiring the Department of Revenue to adopt rules; authorizing the department to adopt emergency rules; providing an effective date. Be It Enacted by the Legislature of the State of Florida: Section 1. Paragraph (n) of subsection (1) and paragraph (c) of subsection (2) of section 220.03, Florida Statutes, are amended to read: 220.03 Definitions.— (1) SPECIFIC TERMS.—When used in this code, and when not other- wise distinctly expressed or manifestly incompatible with the intent thereof, the following terms shall have the following meanings: (n) “Internal Revenue Code” means the United States Internal Revenue Code of 1986, as amended and in effect on January 1, 2026 2025, except: 1. As provided in subsection (3); 2. Sections 168(k), 174(a), 163(j), 274, and 179 of the United States Internal Revenue Code of 1986 are included as amended and in effect on January 1, 2025; and 3. Sections 168(n) and 174A are not included. (2) DEFINITIONAL RULES.—When used in this code and neither otherwise distinctly expressed nor manifestly incompatible with the intent thereof: (c) Any term used in this code has the same meaning as when used in a comparable context in the Internal Revenue Code and other statutes of the United States relating to federal income taxes, as such code and statutes are in effect on January 1, 2026, except as provided in paragraph (1)(n) 2025. However, if subsection (3) is implemented, the meaning of a term shall be taken at the time the term is applied under this code. Section 2. Subsection (2) of section 220.13, Florida Statutes, is amended to read: 220.13 “Adjusted federal income” defined.— 1 CODING: Words stricken are deletions; words underlined are additions.

(2) For purposes of this section, a taxpayer’s taxable income for the taxable year means taxable income as defined in s. 63 of the Internal Revenue Code and properly reportable for federal income tax purposes for the taxable year, except as provided in s. 220.03(1)(n) and (2)(c), but subject to the limitations set forth in paragraph (1)(b) with respect to the deductions provided by ss. 172 (relating to net operating losses), 170(d)(2) (relating to excess charitable contributions), 404(a)(1)(D) (relating to excess pension trust contributions), 404(a)(3)(A) and (B) (to the extent relating to excess stock bonus and profit-sharing trust contributions), and 1212 (relating to capital losses) of the Internal Revenue Code, except that, subject to the same limitations, the term: (a) “Taxable income,” in the case of a life insurance company subject to the tax imposed by s. 801 of the Internal Revenue Code, means life insurance company taxable income; however, for purposes of this code, the total of any amounts subject to tax under s. 815(a)(2) of the Internal Revenue Code pursuant to s. 801(c) of the Internal Revenue Code shall not exceed, cumulatively, the total of any amounts determined under s. 815(c)(2) of the Internal Revenue Code of 1954, as amended, from January 1, 1972, to December 31, 1983; (b) “Taxable income,” in the case of an insurance company subject to the tax imposed by s. 831(b) of the Internal Revenue Code, means taxable investment income; (c) “Taxable income,” in the case of an insurance company subject to the tax imposed by s. 831(a) of the Internal Revenue Code, means insurance company taxable income; (d) “Taxable income,” in the case of a regulated investment company subject to the tax imposed by s. 852 of the Internal Revenue Code, means investment company taxable income; (e) “Taxable income,” in the case of a real estate investment trust subject to the tax imposed by s. 857 of the Internal Revenue Code, means the income subject to tax, computed as provided in s. 857 of the Internal Revenue Code; (f) “Taxable income,” in the case of a corporation which is a member of an affiliated group of corporations filing a consolidated income tax return for the taxable year for federal income tax purposes, means taxable income of such corporation for federal income tax purposes as if such corporation had filed a separate federal income tax return for the taxable year and each preceding taxable year for which it was a member of an affiliated group, unless a consolidated return for the taxpayer and others is required or elected under s. 220.131; (g) “Taxable income,” in the case of a cooperative corporation or association, means the taxable income of such organization determined in accordance with the provisions of ss. 1381-1388 of the Internal Revenue Code; Ch. 2026-137 LAWS OF FLORIDA Ch. 2026-137 2 CODING: Words stricken are deletions; words underlined are additions.

(h) “Taxable income,” in the case of an organization which is exempt from the federal income tax by reason of s. 501(a) of the Internal Revenue Code, means its unrelated business taxable income as determined under s. 512 of the Internal Revenue Code; (i) “Taxable income,” in the case of a corporation for which there is in effect for the taxable year an election under s. 1362(a) of the Internal Revenue Code, means the amounts subject to tax under s. 1374 or s. 1375 of the Internal Revenue Code for each taxable year; (j) “Taxable income,” in the case of a limited liability company, other than a limited liability company classified as a partnership for federal income tax purposes, as defined in and organized pursuant to chapter 605 or qualified to do business in this state as a foreign limited liability company or other than a similar limited liability company classified as a partnership for federal income tax purposes and created as an artificial entity pursuant to the statutes of the United States or any other state, territory, possession, or jurisdiction, if such limited liability company or similar entity is taxable as a corporation for federal income tax purposes, means taxable income determined as if such limited liability company were required to file or had filed a federal corporate income tax return under the Internal Revenue Code; (k) “Taxable income,” in the case of a taxpayer liable for the alternative minimum tax as defined in s. 55 of the Internal Revenue Code, means the alternative minimum taxable income as defined in s. 55(b)(2) of the Internal Revenue Code, less the exemption amount computed under s. 55(d) of the Internal Revenue Code. A taxpayer is not liable for the alternative minimum tax unless the taxpayer’s federal tax return, or related federal consolidated tax return, if included in a consolidated return for federal tax purposes, reflect a liability on the return filed for the alternative minimum tax as defined in s. 55(b)(2) of the Internal Revenue Code; (l) “Taxable income,” in the case of a taxpayer whose taxable income is not otherwise defined in this subsection, means the sum of amounts to which a tax rate specified in s. 11 of the Internal Revenue Code plus the amount to which a tax rate specified in s. 1201(a)(2) of the Internal Revenue Code are applied for federal income tax purposes. Section 3. (1) The amendments made by this act to ss. 220.03(1)(n) and (2)(c) and 220.13(2), Florida Statutes, operate retroactively to January 1, 2026. (2) Pursuant to the rulemaking authority in s. 213.06, Florida Statutes, and the specific authority in s. 213.05, Florida Statutes, for the Department of Revenue to regulate, control, and administer all revenue laws therein, including all portions of chapter 220, Florida Statutes, the Department of Revenue shall adopt rules to implement this act. Ch. 2026-137 LAWS OF FLORIDA Ch. 2026-137 3 CODING: Words stricken are deletions; words underlined are additions.

(3) The Department of Revenue is authorized, and all conditions are deemed met, to adopt emergency rules under s. 120.54(4), Florida Statutes, for the purpose of implementing this act. Notwithstanding any other law, emergency rules adopted under this section are effective for 6 months after adoption and may be renewed during the pendency of procedures to adopt permanent rules addressing the subject of the emergency rules. Section 4. This act shall take effect upon becoming a law. Approved by the Governor June 11, 2026. Filed in Office Secretary of State June 11, 2026. Ch. 2026-137 LAWS OF FLORIDA Ch. 2026-137 4 CODING: Words stricken are deletions; words underlined are additions.