Florida Tax-Paid Distributor (Cigarettes) Bond: A Comprehensive Guide
This guide provides information for insurance agents to help their customers obtain a Florida Tax-Paid Distributor (Cigarettes) bond.
At a Glance:
- Lowest Cost: $100 per year or $10 a month
- Bond Amount: $1,000
- Who Needs It: All tax-paid cigarette distributors operating in Florida
- Who Regulates Tax-Paid Cigarette Distributors in Florida: The Florida Department of Business and Professional Regulation (DBPR)
- Purpose: To ensure that the FDBPR will receive compensation for financial harm if the licensee fails to pay all required taxes
Background
Florida Statute 210.35 requires all tax-paid cigarette distributors operating in the state to obtain a license from the Department of Business and Professional Regulation. The Florida Legislature enacted the license requirement to ensure that tax-paid cigarette distributors do not engage in unethical business practices. To provide financial security for the enforcement of the licensing law, tax-paid cigarette distributors must purchase and maintain a surety bond to be eligible for licensure.
What Is the Purpose of the Florida Tax-Paid Distributor (Cigarettes) Bond?
Florida Statute 210.40 requires all tax-paid cigarette distributors to purchase a surety bond as part of the application process to obtain a license. The bond ensures that restitution is available to the Department of Business and Professional Regulation should the tax-paid cigarette distributors fail to abide by the regulations outlined in the Florida Statutes Title XIV, Chapter 210, Part I. Specifically, the bond ensures that the FDBPR will receive compensation for financial harm if the licensee fails to pay all required taxes and fees. In short, the bond is a type of insurance that protects the FDBPR if the tax-paid cigarette distributor violates the terms of their license.
How Can an Insurance Agent Obtain a Florida Tax-Paid Distributor (Cigarettes) Bond?
BondExchange makes obtaining a Florida Tax-Paid Distributor (Cigarettes) bond easy. Simply log in to your account and use our keyword search to find the “tax-paid cigarette distributor” bond in our database. Don’t have a login? Enroll now, and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone (800) 438-1162, email, or chat from 7:30 AM to 7:00 PM EST to assist you.
At BondExchange, our 40 years of experience, leading technology, and access to markets ensures that we have the knowledge and resources to provide your clients with fast and friendly service whether obtaining quotes or issuing bonds.
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Is a Credit Check Required for the Florida Tax-Paid Distributor (Cigarettes) Bond?
No, a credit check is not required for the Florida Tax-Paid Distributor (Cigarettes) bond. Because the bond is considered relatively low risk, the same rate is offered to all tax-paid cigarette distributors in Florida regardless of their credit history.
How Much Does the Florida Tax-Paid Distributor (Cigarettes) Bond Cost?
The Florida Tax-Paid Distributor (Cigarettes) bond costs just $100 per year or $10 a month.
How Does Florida Define “Tax-Paid Cigarette Distributor”?
To paraphrase Florida Statute 210.25, a tax-paid cigarette distributor is a state-licensed individual who is in the business of making, manufacturing, fabricating, or selling cigarette/tobacco products in the State of Florida.
BondExchange now offers monthly pay-as-you-go subscriptions for surety bonds. Your customers are able to purchase their bonds on a monthly basis and cancel them anytime. Learn more here.
How Do Tax-Paid Cigarette Distributors Obtain a License in Florida?
Tax-paid cigarette distributors in Florida must navigate several steps to obtain a license. Below are the general guidelines, but applicants should refer to the Department’s Application Requirements webpage for details on the process.
License Period – Florida tax-paid cigarette distributor licenses expire on June 30th of each year.
Step 1 – Purchase Surety Bond
Florida tax-paid cigarette distributors must purchase and maintain a surety bond for the entire duration of their license period.
Step 2 – Complete License Application
Tax-paid cigarette distributor license applications must be completed and submitted to the Department via its Online Services portal. The following items/documents must also be attached:
- $25 application fee
- Certified copies of arrest disposition
- Mitigation of moral character (if applicable)
- Right of occupancy (if applicable)
- Letter from cigarette taxing authority
- Secretary of State Certificate of Status
- FEIN (Federal Employer’s Identification Number)
How Do Tax-Paid Cigarette Distributors in Florida Renew Their Licenses?
Florida tax-paid cigarette distributor licenses expire on June 30th of each year. Renewal license applications must be submitted via the DBPR Online Services on or before the expiration date. Renewal fees may apply.
What Are the Insurance Requirements for Tax-Paid Cigarette Distributors in Florida?
Florida does not require tax-paid cigarette distributors to purchase any form of liability insurance as a prerequisite to obtaining a license. Tax-paid cigarette distributors must purchase and maintain a surety bond.
How Do Florida Tax-Paid Cigarette Distributors File Their Bonds?
Tax-paid cigarette distributors in Florida should submit their completed bond forms, including the power of attorney, electronically when submitting their license applications. The surety bond requires signatures from the surety company and the distributor. The surety company should include the following information on the bond form:
- Legal name and address of the individual buying the bond
- Surety company’s name
- Date the bond is signed
What Can Florida Cigarette Exporters Do to Avoid Claims Made Against Their Bonds?
The best way to avoid a claim against a Florida Tax-Paid Distributor (Cigarettes) bond is to pay all tobacco/cigarette-related taxes, penalties, and interest that are due to the Department of Business and Professional Regulation in full and on time.
What Other Insurance Products Can Agents Offer Tax-Paid Cigarette Distributors in Florida?
Most reputable tax-paid cigarette distributors will purchase business liability insurance. Bonds are our only business at BondExchange, so we do not issue any other types of insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.
How Can Insurance Agents Prospect for Florida Tax-Paid Cigarette Distributor Customers?
Florida conveniently provides a public database to search for active tax-paid cigarette distributors in the state. The database can be accessed here. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.
