Tax Law

Recent Posts

Where’s the Substance? Maryland Court of Special Appeals Upholds Assessment of Tax Against Out-of-State Holding Company Based on Parent Company Nexus
Posted on 11 Jul 2019 by Eversheds Sutherland LLP

The Maryland Court of Special Appeals upheld the Maryland Tax Court’s decision holding that the State Comptroller can subject an out-of-state holding company to tax because the holding company did not have economic substance apart from its parent, which... Read More

New York Court of Appeals Dismisses Commerce Clause Challenge For Lack of a “Substantial Constitutional Question”
Posted on 26 Jun 2019 by Eversheds Sutherland LLP

New York’s highest court dismissed taxpayers’ appeal of an Appellate Division ruling that the payment of tax on intangible income to New York as statutory residents, without a credit for tax paid to Connecticut as domiciliaries, determining that the appeal... Read More

Much Ado About Nothing! Colorado Supreme Court Holds that Holding Companies with No Property or Employees are Not Includable in a Combined Group
Posted on 11 Jun 2019 by Eversheds Sutherland LLP

The Colorado Supreme Court issued two decisions simultaneously holding that neither Oracle Corporation nor Agilent Technologies, Inc. were required to include in their combined income tax returns holding companies that did not meet the statutory definition... Read More

Over-Hall: U.S. Supreme Court Holds States Retain Sovereign Immunity from Private Suits in Other States, Overturning Nevada v. Hall
Posted on 11 Jun 2019 by Eversheds Sutherland LLP

In a 5-to-4 decision, the US Supreme Court held that states retain sovereign immunity from private suits brought by individuals in courts of other states, and therefore, overruled its prior decision in Nevada v. Hall , 440 US 410 (1979). The decision... Read More

Apples to Oranges: Arkansas finds no independent business versus non-business test for expenses
Posted on 10 May 2019 by Eversheds Sutherland LLP

On April 1, 2019, the Arkansas Office of Hearings and Appeals held that a taxpayer could not deduct interest expense for long-term debt used to finance a cash dividend as a non-business expense allocable to Arkansas because there was no corresponding... Read More

More Than Smoke: Oregon Tax Court Holds Cigarette Manufacturer’s In-State Activities Exceeded P.L. 86-272
Posted on 28 Mar 2019 by Eversheds Sutherland LLP

On February 26, 2019, the Oregon Tax Court held that an out-of-state cigarette manufacturer’s in-state activities violated Public Law 86-272, resulting in the manufacturer being subject to Oregon’s corporation excise tax. P.L. 86-272 prohibits any state... Read More

Kentucky Court of Appeals Holds Parent Company Not Includible in Consolidated Return
Posted on 29 Mar 2019 by Eversheds Sutherland LLP

The Kentucky Court of Appeals held in an unpublished opinion that an out-of-state parent company was not an “includible corporation” as defined by Kentucky law and could not file a consolidated return with its in-state subsidiary. The Department argued... Read More

Tennessee rules the “true object” of a bundled transaction is nontaxable data analytics services, not remotely accessed software
Posted on 1 Apr 2019 by Eversheds Sutherland LLP

The Tennessee Department of Revenue issued a letter ruling finding that a taxpayer’s mobile and web data analytics services were not subject to sales and use tax. The taxpayer’s customers installed the taxpayer’s software code, which collected user data... Read More

Maryland Tax Court Strikes Again: Out-of-State LLCs Liable for Maryland Income Tax
Posted on 1 Apr 2019 by Eversheds Sutherland LLP

The Maryland Tax Court held that six nonresident Limited Liability Companies (LLCs) wholly-owned by another out-of-state limited liability company owed Maryland income tax despite the fact that the LLCs, as disregarded entities, had no federal income... Read More

Tennessee rules the “true object” of a bundled transaction is nontaxable data analytics services, not remotely accessed software
Posted on 1 Apr 2019 by Eversheds Sutherland LLP

The Tennessee Department of Revenue issued a letter ruling finding that a taxpayer’s mobile and web data analytics services were not subject to sales and use tax. The taxpayer’s customers installed the taxpayer’s software code, which collected user data... Read More

Maryland Tax Court Strikes Again: Out-of-State LLCs Liable for Maryland Income Tax
Posted on 1 Apr 2019 by Eversheds Sutherland LLP

The Maryland Tax Court held that six nonresident Limited Liability Companies (LLCs) wholly-owned by another out-of-state limited liability company owed Maryland income tax despite the fact that the LLCs, as disregarded entities, had no federal income... Read More

Kentucky Court of Appeals Holds Parent Company Not Includible in Consolidated Return
Posted on 29 Mar 2019 by Eversheds Sutherland LLP

The Kentucky Court of Appeals held in an unpublished opinion that an out-of-state parent company was not an “includible corporation” as defined by Kentucky law and could not file a consolidated return with its in-state subsidiary. The Department argued... Read More

More Than Smoke: Oregon Tax Court Hold Cigarette Manufacturer’s In-State Activities Exceeded P.L. 86-272
Posted on 28 Mar 2019 by Eversheds Sutherland LLP

On February 26, 2019, the Oregon Tax Court held that an out-of-state cigarette manufacturer’s in-state activities violated Public Law 86-272, resulting in the manufacturer being subject to Oregon’s corporation excise tax. P.L. 86-272 prohibits any state... Read More

New Jersey Tax Court Rules Not Taxes but Must be Added-Back as Taxes for CBT
Posted on 27 Mar 2019 by Eversheds Sutherland LLP

On January 31, 2019, the New Jersey Tax Court issued its ruling on whether a taxpayer must add-back intercompany payments to its parent, estimated payments based on tax sharing agreements, as tax payments made to other states. The payments were to reimburse... Read More

Indiana Department of Revenue Finds Out-of-State Pharmacy Benefit Management Provider Must Include Income from Drug Sales to Indiana Customers in Sales Factor
Posted on 25 Mar 2019 by Eversheds Sutherland LLP

In a letter of finding, the Indiana Department of Revenue concluded that a pharmacy benefit management provider was required to include in its sales factor receipts from prescription drugs sold to Indiana customers. The taxpayer contracted with insurance... Read More