Florida’s TIP 25C01-01 clarifies how the state’s updated 2025 conformity to the federal tax code affects corporate income tax calculations, including specific addbacks and credits.
The Florida Department of Revenue has released TIP 25C01-01 on 1 December 2025, providing explanation on how Florida’s updated static conformity to the federal Internal Revenue Code, now effective from 1 January 2025, affects corporate income tax, including required state adjustments for bonus depreciation, qualified improvement property, business meals, certain production costs, and newly enacted state credits, as well as the computation of Florida taxable income starting from federal taxable income.
Florida Corporate Income Tax Adoption of 2025 Internal Revenue Code
Each year, the Florida Legislature must consider adopting the current Internal Revenue Code (Title 26, United States Code) to ensure that certain tax definitions and the calculation of adjusted federal income will be consistent between the Internal Revenue Code (IRC) and the Florida Income Tax Code (chapter 220, Florida Statutes [F.S.]). The Florida corporate income tax “piggybacks” federal income tax determinations and uses adjusted federal income as the starting point for computing Florida net income
This year, sections 60-61 of ch. 2025-208, Laws of Florida, amend the Florida Income Tax Code to adopt the IRC retroactively to January 1, 2025. This means Florida will follow the computation of federal taxable income. However, section 220.13(1)(e), F.S., continues to require several modifications to federal taxable income, including:
Bonus depreciation
An addition is required equal to the amount deducted as bonus depreciation under s. 168(k), IRC (the “addback”), for assets placed in service before January 1, 2027. Amounts required to be added to federal taxable income for bonus depreciation are provided back to a taxpayer through an annual subtraction over a seven-year period, equal to one-seventh of the amount of the addition, beginning with the taxable year of the addition.
Qualified improvement property placed in service on or after 1 January 2018
An addition is required equal to the amount of federally deducted depreciation of qualified improvement property, as defined in s. 168(e)(6), IRC, whether depreciated under s. 167(a), IRC, or bonus depreciated under s. 167 or s. 168(k), IRC. There is a corresponding Florida subtraction for the depreciation that would have been allowed under the IRC in effect on January 1, 2020, without the retroactive change made by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and without taking into account any sale or other disposition of the property.
Business meal expenses
An addition is required equal to the amount federally deducted in excess of the amount allowed prior to changes made to the IRC by Public Law 116-260, Division EE, Title II, s. 210, making business meals provided by a restaurant 100% deductible.
Film, television, and live theatrical production expenses
An addition is required equal to the amount of the deduction taken on the federal return under s. 181, IRC. The corresponding subtraction is equal to the amount that would have been allowed without application of s. 181, IRC, if any.
Federal Credits
Florida does not allow any adjustment to federal taxable income for federal credits unless specifically stated in the Florida Statutes. Section 220.13(1)(b)3., F.S., allows a deduction for wages and salaries paid in Florida when a federal deduction is not allowed pursuant to s. 280C(a), IRC. However, for other federal credits, a Florida deduction is not included in the Florida Statutes and therefore not allowed.
Florida Credits
Visit the Department of Revenue’s Florida Tax Incentives for Businesses webpage for more information on credits that may be applied against Florida corporate income tax.
Rural Community Investment Program – Applicable to taxable years that begin within the 2025-29 calendar years, this credit is available against Florida corporate income tax or insurance premium tax to taxpayers who make investor contributions in a rural fund. Additional information and credit applications are provided at the Florida Department of Commerce’s website: floridajobs.org/community-planning-anddevelopment/rural-community-investment-program
Home Away From Home Tax Credit
Applicable to taxable years that begin within the 2026-31 calendar years, this credit is available against specific Florida taxes, including corporate income tax, for taxpayers who make private monetary contributions to eligible charitable organisations that house families of critically ill children receiving treatment, at minimal to no cost to the family. Taxpayers may apply to the Department of Revenue for an allocation of credit beginning at 9 a.m. on 2 January 2026. ET.
The fastest and easiest way to apply for a tax credit allocation is by visiting the Department’s MultiTax Credits webpage.
Eligible charitable organisation(s) are designated by the Florida Department of Health and identified on its website at: floridahealth.gov/programs-andservices/childrens-health/HAFH/index.html.
