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STARTING AND OPERATING A BUSINESS IN FLORIDA Copyright © 2003, Michael D. Jenkins
CONTENTS OF THIS CHAPTER:
I. INTRODUCTION I. INTRODUCTION Florida, the fastest-growing large state in the U.S., now ranks fourth in population, and is one of the best places in the U.S. to start or relocate a business, with its low tax rates and very business-friendly environment. Florida has a right-to-work law, and until recently (2005), had no state minimum wage law. Like most states, Florida imposes a franchise tax (based on income) on corporations, a sales and use tax, various excise taxes, with property taxes mostly imposed at the local level. However, it is the only large state besides Texas that does not have a personal income tax. Florida has also adopted a limited liability company (LLC) law, and more recently a limited liability partnership (LLP) law, so that businesses operating in Florida in LLC or LLP form may obtain the advantages of limited liability, without incorporating or becoming subject to corporate taxation, generally. At present, the state's economy is relatively healthy, in terms of the level of unemployment and other economic measures. For example, in January, 2003, the Florida unemployment rate was only 5.3%, down slightly from 5.6% a year earlier, and lower than the national unemployment rate of 5.7% in January, 2003. To view the latest federal Bureau of Labor Statistics unemployment rate data for Florida or any other state, visit the BLS website. II. LEGAL ENTITIES -- FILING FEES AND REPORTING REQUIREMENTS. (a) In General. A business that operates in Florida can operate as a sole proprietorship, a general or limited partnership, a corporation, or a limited liability company. In addition, like the federal tax law, the state income tax law also recognizes S corporations, for income (franchise) tax purposes, so that the business income of an S corporation is generally not taxed by the state at all, since there is no individual state income tax on the owners. Florida also provides for limited liability partnerships, in which no partner is liable for debts of the partnership, in general, as in the case of a corporation or LLC, but with fewer legal formalities than are required for either a corporation or an LLC. Each of the above entities is discussed below, along with the basic requirements for forming such an entity and any general ongoing (non-tax) reporting requirements that are applicable to it. The tax treatment of each form of legal entity is discussed in Section IV below. (b) Sole Proprietorships. In general, sole proprietorships in Florida can be formed with no formalities. However, as discussed in Section IV(b), it will generally be necessary to obtain one or more local business licenses from cities or counties in which you operate and, in some cases, state licenses, as well. No state income tax is imposed on the income of a sole proprietorship, since Florida does not have any personal income tax. Thus, your sole proprietorship income is only taxable and reportable on Schedule C of your federal Form 1040. As a sole proprietor, if you have no employees, you are also not required to pay any unemployment taxes, withhold any income tax from wages, nor obtain workers' compensation coverage for yourself. (c) Partnerships. As a rule, general partnerships in Florida can be formed with no formalities, although it is highly advisable to have a written partnership agreement. However, as discussed in Section IV(b), it will generally be necessary to obtain one or more local business licenses from cities or counties in which you operate and, in some cases, state licenses, for any type of partnership, including general or limited partnerships, or limited liability partnerships. However, general partnerships should register with the Florida Secretary of State, paying a $50 registration fee. They may also file a Statement of Authority ($25 fee) with the Secretary of State. A limited partnership, in which there is at least one general partner (who is liable for partnership debts) and at least one limited partner (who is not liable for partnership debts), may also be formed under Florida law. Unlike a general partnership, a limited partnership must generally have a written partnership agreement, and must file a certificate of limited partnership with the Florida Secretary of State and pay a filing fee based on the amount of capital that is contributed and expected to be contributed to the partnership. The fee is $7 per $1,000 of such contributions with a minimum of $52.50 and maximum of $1,750. A foreign limited partnership must register and pay fees on the same basis as a domestic partnership, based on the portion of its capital that is allocated for the purpose of transacting business in Florida. A Uniform Business Report must also be filed by domestic and foreign limited partnerships, with the secretary of state, together with an annual fee which is calculated on the same basis as the original registration fee, but with an annual minimum of $52.50 and a maximum of $437.50. Failure to file the annual Uniform Business Report can result in revocation of the limited partnership's authority to conduct business in Florida. Florida law was simplified in 2000, to replace all the various annual reports formerly required of limited partnerships, LLPs, LLCs, and corporations with the new Uniform Business Report form, used by all such entities that are required to file annual reports. An annual supplemental fee of $88.75 is imposed on each limited partnership, LLC, or corporation that is required to file an annual report in 1999 and thereafter. For information on limited partnership filing requirements, see the contact information for the offices of the secretary of state, listed in Section VI(a). Limited liability partnerships (LLPs) are a new form of partnership permitted under the laws of Florida. Like an LLC, an LLP provides limited liability for its owners, while retaining most of the tax advantages of a partnership for federal and Florida state income tax purposes. However, unlike an LLC, an LLP typically operates like a regular partnership, and is not required to file articles of organization. To form an LLP in Florida, you must file a registration with the secretary of state and pay a filing fee of $25. The registration must renewed annually and the same $25 fee applies each year. An LLP is not subject to the Florida corporate franchise tax on income. LLCs in Florida, unlike LLPs, were formerly subject to the corporate franchise tax, but now are no longer taxable, unless the LLC is treated as a corporation for federal tax purposes. Foreign LLPs, those created under the laws of another state, must also register with the Florida Secretary of State and and pay the same fees as a domestic LLP. For more information on LLP registration and other requirements, see the contact information for the offices of the secretary of state, listed in Section VI(a). Note that one potential drawback of LLPs, if you will do business in other states besides Florida, is that some states, like California and New York, only recognize certain types of professional partnerships as LLPs. If yours is not a professional partnership, such other states may simply treat your LLP like an ordinary general partnership, with no limitation of liability. A partnership agreement, for any type of partnership, should spell out in considerable detail such matters as the following:
Partnerships, as entities, are not subject to state income tax in Florida. There is no state personal income tax in Florida, so the income of a partnership is also not taxed to the individual partners for state tax purposes. However, if there are any corporate partners, a partnership tax return must be filed, and the corporation must pay Florida franchise (income) tax on its share of the partnership taxable income. (d) Corporations. To form a corporation in Florida, you must file articles of incorporation with the Florida Secretary of State, Division of Corporations and pay a filing fee of $70 ($35 plus a $35 registered agent fee). Certain supplemental fees may also apply. A foreign corporation (one formed under the laws of another state or a foreign country), must obtain a certificate of authority before it may legally conduct business in Florida, by filing an application for a certificate of authority and paying a the filing fees of $70 described above. Certain supplemental fees may also apply. For more information on filing articles of incorporation or applying for a certificate of authority to do business in Florida, see the contact information for the offices of the secretary of state, listed in Section VI(a). In addition, once your corporation is formed, it will be required to file annual Uniform Business Reports and pay a filing fee of $150 ($61.25 plus a supplemental fee of $88.75) with the Florida Secretary of State each year. Failure to file this report on a timely basis could result in suspension or revocation of your corporation's charter, or in a $400 penalty if it is filed after May 1. In addition to paying federal income taxes on its income, a corporation that does business in Florida must also file corporate franchise (income) tax returns with the state. See Section IV(c) for a discussion of state corporate income tax rates and tax return filing requirements. For tax forms and more information on corporate income taxation in Florida, see the contact information for the offices of the Florida Department of Revenue, listed in Section VI(a). (e) S Corporations. An S corporation is simply a regular corporation that has elected, for federal or state income tax purposes, or for both, to be taxed somewhat like a partnership, with its income, losses and tax credits flowing through to its owners, who report such income, losses, or credits on their individual tax returns. Florida recognizes S corporations for income tax purposes, and treats them in a manner similar to the federal tax treatment. That is, an S corporation is not subject to Florida taxes on corporate income, except in the unusual case where an S corporation is required to pay federal income tax on some of its income. Furthermore, since there is no individual state income tax in Florida, the income of an S corporation is generally not subject to any kind of state income tax in Florida. (f) Limited Liability Companies. Florida, like every other state, has adopted a limited liability company (LLC) law, and was one of the first states to do so. Thus, in addition to the traditional choices of a sole proprietorship, partnership, or corporation, a business that operates in Florida may also choose to operate in the form of an LLC. In most states, LLCs are very attractive entities for many small businesses, in that they offer the same protection as a corporation from creditors for debts of the business, while offering much of the flexibility plus the flow-through tax treatment of a partnership for federal tax purposes. See Section IV(c) for a discussion of the income tax treatment of LLCs under Florida's franchise tax law. To form an LLC under the laws of Florida, articles of organization must be filed with the Florida Secretary of State, which must be accompanied by filing fee of $125 ($100 filing fee plus required $25 registered agent fee). Foreign LLCs, those formed under the laws of another state, must obtain a certificate of authority to do business in Florida, by filing an application for a certificate of authority with the secretary of state and paying the applicable filing fees, the same as for domestic LLC, $125. In addition to initial filing fees, an LLC formed in Florida must subsequently file annual Uniform Business Reports and pay an annual report filing fee of $50. A foreign LLC is also required to file a Uniform Business Report and pay the applicable filing fee of $50. A supplemental filing fee of $88.75 must also be paid. For more information on filing articles of organization for an LLC, see the contact information for the offices of the Florida Secretary of State, listed in Section VI(a). III. BUSINESS ACQUISITIONS (a) In General. When acquiring an existing business, there are a number of state legal and tax issues you or, preferably, your business attorney, should attend to before closing the purchase. These include matters such as doing a title search for any real property that is being acquired, checking for any recorded security interests on personal property items, and thoroughly researching county, state, and federal records for any judgment liens, tax liens, or other liens, before property is acquired. You will also benefit from consulting a tax advisor before the agreement of sale is negotiated, in order to seek a structuring of the agreement so that the purchase price is allocated among the assets in a way that favors you. You may be able to obtain considerable tax savings if the purchase price is allocated in a way that gives you the best possible tax results under federal and state income tax laws, and other state tax laws, such as sales/use tax or property tax laws. Depending upon the state (or states) in which the seller's assets are located, you may also have to comply with state bulk sale or bulk transfer laws. You should also obtain tax releases from various state taxing agencies, as discussed below. (b) Bulk Sale Laws. Typical bulk sale laws require either publication of legal notices to all creditors in advance of the sale and recording of such notices in some cases, or maintenance of detailed lists of the property to be transferred, for inspection by the public. Florida is one of the states that has repealed its bulk sale laws, so you no longer have to be concerned with this requirement when buying a business in Florida. (c) Tax Releases. When you acquire an existing business, you will want to make sure that you do not unwittingly become liable for any unpaid taxes owed by the seller. Typically, to protect yourself, you will need to receive a tax release or releases from various state taxing agencies, for such taxes as sales and use tax, income tax withholding, and state unemployment taxes, in each state in which the seller does business. If you fail to obtain such a release or written statement from the tax agency that the seller is not delinquent on any tax payments, you will be held responsible for such tax if it is not withheld from the purchase price proceeds and paid to the state at the time the sale of the business transpires. In Florida, you will not have to be concerned with state income tax (wage) withholding, since there is no state individual income tax. However, you should take great care to ascertain whether the seller has paid all required state unemployment taxes, and check with county tax collectors to see if any property of the seller is subject to a lien for real property taxes or taxes on tangible or intangible personal property. (d) Unemployment Tax Rating of Seller. In addition to obtaining tax releases, you may find it advantageous to succeed to the seller's unemployment tax experience rating, if the seller has a tax rate lower than you would otherwise obtain as a new business. To obtain the seller's favorable experience rating as a successor employer, you will need to apply within 30 days to the Division of Unemployment Compensation on Form UCT-7, requesting that you be treated as a successor employer. IV. FLORIDA TAXES AND OTHER GENERAL REQUIREMENTS. (a) In General.
Florida has a generally very favorable tax climate for
businesses. As we have noted elsewhere in this publication,
there is no Florida individual income tax. Thus, if you
operate your business as a sole proprietorship, partnership,
or an S corporation, your business profits will not be taxed
by the state. Even if you operate as a C corporation or an
LLC, the corporate income tax your business will have to pay
to the state of Florida is at the relatively low rate of only
5.5% of income. Florida also exempts business inventories
from personal property taxes. These low or non-existent taxes
make Florida a very attractive state in which to conduct a
business.
(b) State and Local Licensing. Nearly any business, operated anywhere in the United States, will have to have at least one government license of some kind. In most cases, this will be a local license, issued by your city or county. Before you open your business, contact your local city or county hall and find out if your particular business needs one or more local licenses. Most kinds of local business licenses are granted upon payment of a fee, with no further requirements, except possibly for annual or other periodic renewal fees. However, if you are engaging in any kind of food business, you will usually need to also obtain a health department permit and show that you are in compliance with health department food-handling requirements. In addition, be sure to check with an attorney or local government zoning or planning department officials to determine if your business will be in compliance with all local zoning and planning restrictions. If you own or rent any type of facility, you will generally need fire department permits, showing that you meet fire safety codes and any construction or improvements to an existing structure will usually require a building permit. If you intend to simply operate your business from your home, you may be in violation of local zoning requirements, but this is less likely to be a concern if you don't have clients, customers, suppliers, or employees coming to your home on business, on a regular basis. State governments have also traditionally required special licenses for many kinds of professionals, such as physicians, dentists, lawyers, and accountants. To further protect consumers, Florida has expanded the list of occupations that must be licensed by the state to include many other occupations. Most state licenses not only require payment of fees, but are only issued for a given profession or occupation upon showing that you have completed certain educational or experience requirements, or passed certain tests, or some combination of the foregoing. For information on state licensing and business registration requirements in Florida, see the contact information for the offices of Enterprise Florida, Inc., the Florida Secretary of State, and the Florida Department of Revenue, all of which are listed in Section VI(a). (c) Income and Franchise Taxes. Florida is one of the few states that does not have an individual income tax, but it does have a corporation income tax, which applies to corporations or to any limited liability company that is treated as a corporation for federal income tax purposes. Partnerships are pass-through entities for Florida income tax purposes, and are not subject to tax themselves, as separate taxable entities. Since there is no general individual state income tax in Florida, the income earned by a partnership is taxable to individual partners only on their federal income tax returns. However, if a partnership has any partners that are corporations, it must file a state partnership information return, Form F-1065, and the corporate partners will be taxable on their respective shares of the partnership income for state franchise (income) tax purposes. Partnership returns are due 15 days after the initial due date of the federal partnership return, or by May 1, in the case of a calendar year partnership that is required to file a state return. The Florida corporate income tax rate, on corporations other than S corporations, is imposed at a flat rate of 5.5%. The state corporation income tax return is Form F-1120, which must be filed with the Department of Revenue by the 1st day of the fourth month following the end of the taxable year, or 15 days after the due date (without considering extensions) of the related federal tax return, if later. Corporations are required to make estimated tax payments of their state corporate income tax in advance, if their tax liability for the year exceeds $2,500. Estimated tax payments are due in advance, in four equal installments, on the 1st day of the 5th, 7th, and 10th months of the taxable year, and on the 1st day of the 1st month of the following taxable year. Penalties will be imposed for failure to make the required estimated tax payments on a timely basis. S corporations are not generally subject to Florida corporate income (franchise) tax on their income. Since there is no state individual income tax in Florida, the income of an S corporation is thus generally not taxed at all by the state. Florida law formerly treated all LLCs like corporations for purposes of the state income tax, and did not allow one-member LLCs. Both laws have been changed, so that Florida law only imposes the corporate income tax on LLCs that are treated as corporations for federal income tax purposes, and Florida now permits formation of one-member LLCs. (d) Sales and Use Tax. Florida imposes a general sales tax on retail sales of tangible personal property, receipts from transient lodgings (of up to 6 months), admissions to events, and most rentals, except for dwellings or agricultural use. The sales tax also applies to certain types of services, such as alarm and security services and non-residential cleaning and pest control services. The sales tax is imposed at the statewide rate of 6%. In addition, local governments are allowed to adopt local sales taxes, at varying tax rates. Sellers are required to obtain a seller's permit and to collect and pay over the state and local sales and use taxes to the Department of Revenue. There are numerous exemptions from the sales tax, the most important of which is the resale exemption. If you are a wholesaler or retailer who purchases goods that you will resell, your purchase of such goods may qualify as an exempt sale for resale. Similarly, if you sell goods to wholesalers or retailers for resale by them, your sale may also qualify as an exempt sale for resale. In any such transaction, the exemption is ordinarily available only if the purchaser gives the seller a valid resale certificate, certifying that the items are being purchased for resale, and not for use or consumption by the buyer. Previously, anyone could make up their own resale certificate and present it to the seller when making a tax-exempt sale. Starting in 2000, the Department of Revenue began mailing out one-year resale certificates each year to every business that is registered as a vendor for Florida sales and use tax purposes. The certificates expire on December 31 of the year of issuance. Sellers may now only rely on such state-issued certificates, when allowing a purchaser to buy goods or services free of sales tax as a sale for resale. A shadow tax, the use tax, is also imposed at the same rate as the sales tax. It is primarily intended to tax property that is acquired from sources outside of the state, in transactions not subject to sales tax, when such property is used or consumed within Florida. Use tax may also apply to items purchased on an exempt basis, such as for resale, if such items end up being used or consumed, instead of being resold. Before making any taxable sales, you will need to register with the Department of Revenue on Form DR-1, Application for Sales and Use Tax Registration. There is a small fee, which must be renewed annually, for a sales tax permit, ranging from $25 for a small business to $50 for a larger firm with $200,000 or more of sales the preceding year. A firm with less than $30,000 in annual taxable sales is exempt from the annual fee. Beginning in January, 2005, taxpayers whose sales and use tax payments for the period from July 1, 2003 through June 30, 2004 were $30,000 or more are required to file returns and remit sales and use tax payments by electronic means. Larger firms, with $200,000 or more of tax payments for that period are required to begin making estimated sales and use tax prepayments on their December, 2004 through November, 2005 sales and use tax returns. Taxpayers with over $1,000 of sales and use tax or solid waste fees for the fiscal year ended June 30, 2004 must become monthly filers, beginning in 2005. For more information on sales and use tax registration and compliance, see contact information for the offices of the Florida Department of Revenue, listed in Section VI(a). (e) Real and Personal Property Taxes. In Florida, as in every other state, any business real estate you own will be subject to real property taxes. In general, there is little that you must do, unless you wish to challenge your assessed valuation, since the assessor will bill you for each year's property taxes as they come due. Florida also imposes personal property taxes on tangible personal property. However, certain business personal property, such as business inventories, are exempt from personal property tax in Florida. Florida also imposes a personal property tax on certain types of intangible personal property. The intangible property tax applies to most stocks, bonds, bills, notes, accounts receivable and other types of credits. It does not apply to certain other intangible assets, such as money or certificates of deposit; franchises; U.S. or Florida state or municipal bonds; or partnership interests, other than limited partnership interests registered with the secretary of state. Effective since January 1, 1999, the tax on accounts receivable has been phased out -- one-third on that date, two-thirds on January 1, 2000, with full repeal of the tax on receivables having become effective on January 1, 2001. The intangibles tax is generally applied at the rate of $1.00 per thousand dollars on the value of an individual's or company's intangible assets, above certain levels. The tax is assessed as of January 1 each year, and you must file an intangible property tax return, Form DR-601I for individuals or Form DR-601C for corporations and other entities, by June 30 with the Department of Revenue. A corporation may elect to pay the intangibles tax on the value of its shares on behalf of its shareholders, in certain cases. Beginning in 2004, businesses whose total intangible tax payments for the state's previous fiscal year (July 1 to June 30) were at least $30,000 must remit the intangible tax by electronic funds transfer (EFT). (f) Other Business Taxes. Florida imposes a number of other taxes on businesses, including:
(g) Trade Names. A trade name, also known as a fictitious or assumed name, is any name used in the course of business that does not include the actual legal names of all the owners of the business. Thus, if your business goes by any name other than your own real name, it is operating under a trade name. The same is true of a corporation, if it operates under a name other than its legal name. A trade name might also be one that suggests the existence of additional owners, by using such words as "company," "associates," or "group." In most states where you do business, it will be necessary to register a trade, fictitious, or assumed name, so that people who do business with you can find out who the actual owners of your business are. You may also want to register any such trade name, as a means of protecting against other companies usurping that particular trade name. If your business operates under a fictitious business name, you must publish a fictitious name statement in a newspaper in the county of your principal place of business in Florida. After it has been published, you need to obtain a proof of publication from the newspaper and file it with the Fictitious Name Registration Office, at the address listed in Section VI(a). There is a $50 filing fee. (h) Florida RICO Law. You need to be aware that if you are a foreign or Florida corporation, or an alien business organization -- one that is either formed under non-U.S. law or formed under U.S. law but 10% (or more) owned directly or indirectly by a foreign entity or individual, you will have to name a Florida registered agent, in order to comply with the Florida Racketeer Influenced and Corrupt Organization (RICO) law. This RICO law requirement will apply if your corporation or alien business organization either:
V. EMPLOYER REQUIREMENTS IF YOU HAVE EMPLOYEES (a) Employer Registration and Withholding. Since Florida has no personal income tax, no state withholding of wages is required in Florida. However, you will still need to register with the state as an employer for unemployment tax purposes, as discussed in Section V(b). (b) Unemployment and Other State Payroll Taxes. If your business employs one or more individuals in each of 20 weeks during any calendar year or if your payroll amounts to $1,500 in any calendar quarter, you, as an employer will be required to pay state unemployment tax based on the amount of such wages paid. Employers subject to the Florida unemployment tax must register with the Florida Department of Revenue on Form DR-1, which is also used to register for sales tax and other business taxes. New employers are required to pay tax at a rate of 2.7% in 2003 on the first $7,000 of wages paid to each employee. After you have had employees for a while, you will develop an unemployment tax experience rating. This rating is based on the number of employees you terminate who then claim unemployment benefits and the amount of such benefits paid to those former employees, under complex formulas. The state will inform you when they have assigned you an individual tax rate based on your firm's experience rating. That rate may be higher or, if you have had relatively few benefit claims charged to your account, lower than the standard new employer tax rate you initially were paying. All state unemployment taxes are imposed upon you as the employer, and, under Florida law, cannot be charged to your employees or withheld from their wages. A liable employer is required by law to display the poster To Employees, Form UCT-83, in a place where all employees can see it. For more information on your Florida unemployment tax obligations as an employer, see the contact information for the offices of the Department of Revenue, listed in Section VI(a). (c) Workers' Compensation. In Florida, virtually all businesses with four or more employees (one or more in the construction industry) are required by law to have workers' compensation insurance, except those able to self-insure. Those employers with three or fewer employees must post a notice that informs employees of their non-entitlement to workers' compensation insurance benefits. Note, however, that a sole proprietor or a partner in a partnership is generally not considered an employee. Officers of a corporation who receive pay for services are automatically considered employees, but they may exempt themselves from the definition of an employee by filing a certificate of exemption with the Division of Workers' Compensation, which is now part of the Florida Department of Financial Services. File a request for exemption on Form DWC-250. Workers' compensation provides wage loss and medical benefits to employees injured on the job and it protects you, as an employer, from legal action for damages for injuries or job-related illnesses suffered by your employees. In effect, it is a "no-fault" insurance system for work-related injuries or illnesses. Thus, if you fail to obtain required workers' compensation insurance, and an employee is injured on the job, you will have opened yourself to unlimited liability and severe legal consequences, so it is very important to obtain workers' compensation insurance for your employees. Be aware that neither general liability nor health and accident insurance can properly substitute for workers' compensation insurance. As an employer, you must notify injured employees of their benefits and post a notice in the workplace informing your employees of their workers' compensation coverage. For more detailed information regarding your obligations as an employer under the Florida workers' compensation laws, contact your insurance carrier or see the contact information for the offices of Division of Workers' Compensation, listed in Section VI(a). (d) State Wage and Hour Laws. Unlike most states, until recently Florida did not have a minimum wage law governing the hourly wage that you must pay to your employees. However, in most cases, a business was still subject to the federal minimum wage and overtime laws, and thus required to pay at least $5.15 an hour, and time-and-a-half for overtime hours, for any non-exempt employee who works more than 40 hours in a week. However, the Florida constitution has been amended, and effective as of May 2, 2005, Florida has a minimum wage of $6.15 an hour. This minimum wage will be indexed to the consumer price index, pursuant to a calculation done on September 30th of each year, and will go into effect on the following January 1. Thus, the $6.15 rate will be adjusted for inflation on January 1, 2006, and each following year. Under the Florida minimum wage law, the definitions of “employer,” “employee,” and “wage” are those established under the federal Fair Labor Standards Act (FLSA). For “tipped employees” meeting eligibility requirements for the tip credit under the FLSA, employers may count tips actually received as wages under the FLSA, but the employer on May 2, 2005 must pay not less than $3.13 per hour in direct wages. (As mandated by Florida’s Constitution, this direct wage represents the 2003 tip credit existing under the FLSA ($3.02) subtracted from Florida’s minimum wage; therefore, as the minimum wage increases each year, the direct wage paid to tipped employees will also increase.) In addition to wage-hour laws, most businesses are subject to federal child labor laws, which put numerous restrictions on the working hours and kinds of work in which minors under the age of 18 may engage. Your business must also be cognizant of similar state child labor laws, in Florida, which are typically similar to the federal laws. Employers in Florida are required to post a child labor poster in the workplace, which can be obtained from the Department of Business and Professional Regulation. (e) State Occupational Safety and Health Laws. Approximately half of the states have their own OSHA-like agency, charged with administering the state's own occupational safety and health laws. The remaining states have no such enforcement agency, and thus rely instead on the federal Occupational Safety and Health Administration (OSHA) to administer the federal job safety rules within such states. Florida is one of the states that does not have its own local equivalent of OSHA. Note that while you may obtain a free safety consultation from federal OSHA experts, they must and will cite you for any violations they discover at your workplace. This is not the case in states with their own OSHA programs, where, if you request a safety consultation from the state agency and they detect violations, they will not cite you if you promptly correct the unsafe conditions. However, while Florida does not have a full-fledged OSHA-type enforcement program, the Division of Safety of the Department of Labor and Employment Security did, until June 30, 2000, provide safety guidelines and safety consultation programs for employers, and had adopted some specific safety rules of its own, but the Division of Safety has been abolished, as of June 30, 2000, and the Department of Labor and Employment Security was abolished also on June 30, 2002, with various functions transferred to other agencies. For information on your job safety and health obligations as an employer, required posters, and possible on-site safety consultations, see the contact information for the Division of Workers' Compensation Compliance, listed in Section VI(a). (f) Other Miscellaneous State Labor Laws. Other Florida labor laws you need to be aware of as an employer include the following: (1) Wage payments to terminated employees. Florida has no specific statutory laws that govern when and how wages are to be paid to a discharged employee. (2) Right-to-work laws. About half the states have enacted "right-to-work" laws, which guarantee that no person may be denied employment for refusing to join a union or for not paying union dues, thus banning either "union shop" or "agency shop" agreements, or both. In a union shop, an employee not belonging to a union may be hired but then must join the union, usually within 30 days. In an agency shop, an employee need not join the union but, to remain employed, must pay union dues. Florida has a right-to-work law. (3) State anti-discrimination laws. In addition to complying with federal anti-discrimination laws, employers must also be aware of and comply with state civil rights laws in Florida, which go beyond the federal civil rights laws in some respects, such as adding persons with AIDS or sickle cell trait to the list of protected classes against whom an employer may not discriminate in the employment relationship. You must also display a poster informing employees of their rights. You can obtain this poster from the Florida Office of Civil Rights. (4) Reporting new hires. Under new federal welfare reform laws, employers in all states are now required to report any newly-hired (or rehired employees) to a designated state agency (the Florida New Hire Reporting Office for Florida employers) within 20 days after the date of hire. (5) Employment of illegal aliens. Florida law makes it illegal to employ aliens without work permits. A first violation is punishable by a civil fine of up to $500, and a second offense is a criminal violation, a second-degree misdemeanor. VI. STATE SOURCES OF HELP AND INFORMATION (a) Key State Agencies Contact Information. Florida, as many states have done in recent years, had set up a "one-stop" center to help your new or existing businesses to obtain all necessary state licenses and permits from a single office, without your having to go from agency to agency to meet all the state legal and regulatory licensing requirements. However, this office, the Bureau of Business Assistance, no longer exists, as its parent agency, the Florida Department of Commerce, has been phased out of existence, for budgetary reasons. While the Department of Commerce has been replaced by an entity called Enterprise Florida, Inc., the new entity appears to offer assistance to small businesses, by providing information on Florida business conditions and engaging in the recruitment of new business to the state. To obtain information on starting or relocating your business in Florida, contact:
You are likely to obtain additional useful information on starting or locating a business in Florida by contacting the offices of the Secretary of State and the Department of Revenue, which are listed below. Addresses and other contact information for other key Florida state government agencies mentioned in this book are also listed below for your convenience. SECRETARY OF STATE. Contact the Division of Corporations of this office for information on a number of corporate and non-corporate requirements:
LICENSING. To find out if a state license is required for your particular business, contact the Department of Revenue at the address listed above for that agency. FICTITIOUS NAME REGISTRATION. After publishing your fictitious name statement in the Florida county where your principal place of business is located, file the proof of publication with:
STATE UNEMPLOYMENT TAX. Contact the Florida Department of Revenue to determine whether you are an employer subject to payment of state unemployment taxes, and for registration as an employer if you are subject. Administration of the state unemployment tax has been moved from the Department of Labor and Employment Security to the Department of Revenue. NEW HIRE REPORTING. You can report newly hired employees over the Internet (see Department of Revenue's URL on the Web in Section VI(c)), or mail reports to the following address:
For workplace safety consultations and information, contact the following:
(b) Small Business Development Centers. A number of Small Business Development Centers (SBDCs) are located throughout Florida to assist you. These centers, usually located on college campuses, provide a wealth of start-up information and sponsor frequent business-oriented seminars. Contact the lead office below for information, or for the location of other SBDCs nearer to you.
(c) Internet Sites. If you have access to the Internet, there is a wealth of state and even local business information provided by state and local governments. All states now have a state government Web page, and most major state agencies also have sites on the Internet where you can obtain useful small business information on matters such as state taxes, financing sources, or the addresses and phone numbers (or e-mail addresses) of various state and federal agencies' offices in Florida. Since new sites are appearing constantly, you might also want to search for other Florida government Web sites by using one of the popular Internet search engines, such as Excite! or Yahoo. To start your Internet search for Florida government information, you may want to begin with the following Internet sites: Access to Florida Government site (My Florida): Department of State, Division of Corporations: Florida Department of Revenue tax forms and information: Florida New Hire Reporting Center (information and downloadable forms for reporting new hires): Division of Workers' Compensation (part of the Department of Financial Services): Florida Small Business Development Centers network: Enterprise Florida: (d) Financing Sources. For information and help on locating financing for your small business, contact the nearest U.S. Small Business Administration office in Florida, or contact the private organization, Enterprise Florida, at the address listed for it in Section VI(a). The address of the SBA District Office in Jacksonville is:
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Copyright © 2003 Michael D. Jenkins
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