(1) Long-term Contracts.
    (a) For purposes of Florida Statutes § 220.42(3), “books of account” includes accountants’ work papers prepared in the normal course of business for the purpose of determining income and preparing periodic reports under the percentage of completion method provided:
    1. They are sufficiently complete and accurate to provide a reliable basis for reconciling the regularly maintained books of account with the tax return;
    2. The originals are turned over to the taxpayer and associated with its regular books of account; and,
    3. They are retained so long as the contents thereof may be material to a proper determination of the tax under the Florida Income Tax Code.
    (b) An election to file the same as Federal under Florida Statutes § 220.42(3), shall be made by filing a timely return on which the income from long-term contracts is reported on the percentage of completion method of accounting. The election must be made in the first year under the Florida Income Tax Code in which any portion of the taxpayer’s gross income derived from long-term contracts would be required to be taken into account under the percentage of completion method for Federal tax purposes.
    (c) In order to secure the Executive Director or the Executive Director’s designee’s consent for revocation of an election made pursuant to this subsection, the taxpayer must file an application in writing with the Department within 180 days after the beginning of the taxable year in which it is desired to revoke the election. The application shall show all amounts which would be duplicated or omitted as a result of the revocation and the taxpayer’s computation of the adjustments required to take into account such duplications or omissions.
    (2) Permission to revoke will not be granted unless the taxpayer and the Executive Director or the Executive Director’s designee agree to the terms, conditions, and adjustment under which the change will be effected.
Rulemaking Authority 213.06(1), 220.42, 220.51 FS. Law Implemented Florida Statutes § 220.42. History—New 10-8-74, Formerly 12C-1.42, Amended 12-21-88, 4-8-92, 3-18-96, 3-13-00.