Florida HB 7031E — 2026 Special Session Tax Package Passed by the Legislature May 29, 2026 | Awaiting Governor's signature
Taxpayers and tax professionals alike have been screaming for years that Florida has not been playing fair with the tax refund process – especially when it comes to paying interest on refunds. The name of the game has been “Deny, Deny, Deny” then after an average of 600 days to give you a refund, deny paying any interest. It may be time to celebrate because the 2026 tax legislative package sitting on the governor’s desk makes significant improvements to the requirement to pay interest on refunds. Below is a summary of the legislation and a link to download the whole tax package is provided at the end.
Amendments to Sec. 213.255, F.S. would be as follows:
Subsection (3) — Completeness Review and Denial Authority (starting at line 1188)
The amendment clarifies the consequences when the Department fails to act within its 30-day window to notify an applicant of errors or omissions. Under the revised text, if the Department does not provide such notice within 30 days of receipt, interest must be calculated under subsection (4) — eliminating any ambiguity about whether interest is discretionary in that circumstance.
The amendment also adds express authority for the Department to deny a refund application when, after requesting additional information, it determines the application still does not contain sufficient information to evaluate the claim. Under prior law the denial pathway in this context was less explicit.
Finally, the amendment codifies when an application becomes "complete": upon receipt of all requested information and correction of all timely-noticed errors or omissions, or when the notification period has expired — whichever is later.
Subsection (4) — When Interest Begins to Accrue (Major Rewrite) (Staring at line 1204)
This is the most substantive change. Prior law provided that interest does not commence until 90 days after a complete refund application has been filed. The amendment replaces that framework with a more precise and taxpayer-favorable rule:
- Interest begins to accrue on the 91st day following the postmark date of a mailed refund application, or the 91st day following electronic submission if submitted electronically.
- If a mailed application bears no postmark, interest begins on the 91st day following the Department's receipt.
- The 90-day completeness trigger is removed as the primary clock — the clock now runs from the date of filing/submission, not from the date the application is deemed complete.
Two existing tolling rules are modified in important ways:
- The fiscal year prohibition language is softened: where a refund cannot be paid before the first day of the state fiscal year, interest may not commence until August 1 of the year the tax was due (prior law used "shall not," a potentially mandatory formulation; "may not" maintains the prohibition but aligns with the revised structure).
- Where the Department and taxpayer mutually agree that an audit or verification is necessary, interest shall not commence until the audit or verification is final. The prior text used "may not," which was arguably permissive; "shall not" makes the tolling mandatory when a mutual audit agreement exists.
New Subsection (5) — Interest on Denial Challenges Where Additional Information Is Later Provided (staring on line 1222)
This is an entirely new provision. It addresses the scenario where an applicant challenges a refund denial — through informal review, administrative proceeding, or judicial proceeding — and provides additional substantiating information during that process. In that event, interest begins to accrue on the 91st day following the day the additional information was provided, rather than dating back to the original application. This prevents taxpayers from claiming interest from the original filing date when the refund claim was legitimately incomplete at the time of denial.
Subsections (6) through (10) — Renumbering
Former subsections (5) through (9) are renumbered (6) through (10) to accommodate the new subsection (5). The substance of these provisions is unchanged, except:
- In renumbered subsection (6) (formerly (5)), concerning unconstitutional taxes, the word "may" is changed to "shall" — making it mandatory rather than discretionary that interest does not commence on complete applications until 90 days after the adjudication becomes final and unappealable or 90 days after a complete application is filed, whichever is later.
Subsection (11) — Rulemaking Cross-Reference Correction
The rulemaking subsection's internal cross-reference to the bond requirement is updated from subsection (7) to subsection (8) to reflect the renumbering.
Bottom Line: The amendments to § 213.255 modernize and clarify the interest-on-refunds framework in three principal ways: (1) they anchor the interest accrual clock to the objective date of filing rather than the more ambiguous "completeness" determination, providing greater certainty to taxpayers; (2) they add a new rule preventing retroactive interest accrual when a taxpayer substantiates a previously denied claim during appeal proceedings; and (3) they tighten several mandatory/permissive formulations to reduce administrative discretion in ways that cut both for and against taxpayers depending on the context.
The real question is just how much are the same people working in the same refund Department going to continue to pay games with the refund process under the new rules. I wager we have almost every refund request denied for a claim of “incomplete records” within the first 30 days to stall the interest accrual process. This will push taxpayers into informal challenges sooner, which could overall expedite the refund process. Time will tell.
ABOUT THE AUTHOR
James H. Sutton, Jr., CPA, Esq. is a shareholder at the Law Offices of Moffa, Sutton & Donnini, P.A., one of Florida's preeminent state and local tax law firms, with offices in Fort Lauderdale, Tampa, and Tallahassee. Mr. Sutton holds dual credentials as a Certified Public Accountant and a Florida-licensed attorney, and his practice is devoted exclusively to Florida sales and use tax controversy — representing businesses from the initial audit notice through protest, litigation, and criminal defense before the Florida Department of Revenue. He has guided Florida businesses through the Voluntary Disclosure Program for more than two decades across virtually every industry in the state. Mr. Sutton teaches Florida sales and use tax to CPAs, attorneys, enrolled agents, and law school students, and is a prolific contributor to the Florida Tax Law Blog at FloridaSalesTax.com. He can be reached at 813-775-2131 JamesSutton@FloridaSalesTax.com or through the contact form at www.FloridaSalesTax.com.
AUTHORITY
House Bill 7031E, Engrossed May 29, 2026, waiting for governor’s signature (or line item veto)
ADDITIONAL RESOURCES
HOW TO PROTEST A FL SALES TAX ASSESSMENT, published May 31, 2026, by James H Sutton, Jr, CPA, Esq.
FLORIDA SALES TAX VOLUNTARY DISCLOSURE: THE BEST WAY TO CLEAN UP A FLORIDA SALES TAX PROBLEM, published May, 26, 2026, by James H Sutton, Jr., CPA, Esq.
FLORIDA SALES TAX ON LABOR, published May 13, 2026, by James Sutton, Jr., CPA, Esq.
FL SALES TAX – RESTAURANTS; WHAT EVERY OWNER NEEDS TO KNOW BEFORE THE DOR KNOCKS, published April 23, 2026, by James H Sutton, Jr, CPA, Esq.
FLORIDA SALES TAX ARREST – PALM BEACH PIZZERIA OWNER, published March 4, 2026, by James H Sutton, Jr., CPA, Esq.