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FL TAX LEGISLATION ALERT – FELONY TO EVEN POSSESS SALES SUPRESSION SOFTWARE

FL TAX LEGISLATION ALERT – FELONY TO EVEN POSSESS SALES SUPRESSION SOFTWARE

FLORIDA LEGISLATION CRIMINALIZING AUTOMATED SALES SUPRESSION SOFTWARE (aka "ZAPPER SOFTWARE") AWAITS GOVENOR'S SIGNATURE

In March 2012, the Florida legislature passed a rather unique piece of legislation aimed specifically at a new type of tax fraud software moving into the United States. The software is known as "Automated Sales Suppression Device," "Zapper," or "Phantom-ware."

The purpose of the software is to suppress the cash sales from the business's accounting records – at the cash register level. The sales are simply eliminated from the system and the user of the software pockets the cash. You can imagine this practice is not only tempting for morally questionable business owners, but that it would also be highly fraudulent for federal income tax and state sales tax purposes as well. The software might be used by an unscrupulous business owner or even an employee (turning the cash register into his personal ATM machine).

Upon signature by the Governor, Section 213.295, Florida Statutes, will be created to criminalize Zappers. After the approved legislation becomes law, a person who knowingly sells, purchases, installs, transfers, possesses, utilizes, or accesses any automated sales suppression device is guilty of a felony of the 3rd degree. It is expected that the Governor will sign this piece of legislation and, unlike like most of the other sales and use tax legislation approved by the Florida Legislature, this statute will take effect immediately after it is signed.

Posted By James Sutton on Mar 26, 2012 12:40pm EDT

Read more at: Tax Times blog

 
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