Tax Law

Recent Posts

Multistate Tax Commission Nexus and Audit Committee Updates – November 2020
Posted on 18 Nov 2020 by Eversheds Sutherland LLP

On November 16 th  and 17 th , 2020, the Multistate Tax Commission’s (“MTC”) Nexus and Audit Committees met to consider several topics.  The biggest developments from these meetings are that: (1) the Nexus Committee shared their proposed, revised draft... Read More

Ownership of Tennessee Mortgages Does Not Create Nexus for Foreign Investment Fund
Posted on 30 Oct 2020 by Eversheds Sutherland LLP

A recent letter ruling from the Tennessee Department of Revenue concludes that the ownership of mortgages backed by Tennessee property was insufficient to subject a foreign investment fund (“Fund”) to the state’s franchise and excise taxes. Tennessee... Read More

California Property Tax and LLC Tax Decisions
Posted on 24 Sep 2020 by Eversheds Sutherland LLP

In this episode we discuss two recent California decisions, including a Court of Appeal decision concerning property tax escape assessments ( Prang v. Los Angeles Cnty. Assessment Appeals Bd. , Case No. B301194 (Cal. Ct. App. Aug. 27, 2020) and an Office... Read More

Tiny Interest + Big Property = California Nexus: Office of Tax Appeals Determines Minority LLC Interest Creates Taxable Nexus
Posted on 16 Sep 2020 by Eversheds Sutherland LLP

On July 7, 2020, the California Office of Tax Appeals (OTA) held that a foreign LLC was subject to the state’s $800 LLC tax because it held a 0.7830849% ownership interest in an LLC that owned property in San Diego. In addition to a more traditional nexus... Read More

Michigan Tax Tribunal to Consider City Income Tax Nexus in light of Wayfair
Posted on 11 Mar 2020 by Eversheds Sutherland LLP

The Michigan Court of Appeals remanded a case on whether Detroit may impose its income tax on an out of state taxpayer, in light of the US Supreme Court’s Wayfair ruling. The Michigan Court of Appeals previously upheld the Tax Tribunal’s decision that... Read More

It’s None of Your Business: California Office of Tax Appeals Rejects FTB’s Broad Test for Doing Business
Posted on 19 Sep 2019 by Eversheds Sutherland LLP

The California Office of Tax Appeals (OTA) reversed the Franchise Tax Board’s (FTB) determination that an out-of-state limited liability company (LLC) had taxable nexus with California solely because it held an ownership interest in an LLC operating in... Read More

Virtual Pets and the Reality of Taxes – Texas Comptroller Affirms Sales Tax Assessment on Online Gaming Company
Posted on 18 Sep 2019 by Eversheds Sutherland LLP

The Texas Comptroller adopted a proposed decision issued by an Administrative Law Judge (ALJ) finding that a company owed sales tax on its sales of online gaming services to Texas residents. The company, who had at least one employee in Texas, developed... Read More

How States Protect Marketplace Facilitators from Tax Overcollection Lawsuits
Posted on 15 Jul 2019 by Eversheds Sutherland LLP

States have enacted new marketplace facilitator laws designed to impose sales tax obligations on marketplace facilitators related to sales made by third-party sellers. These new sales tax collection obligations on marketplace facilitators create the potential... Read More

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

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

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

Unboxing the New Jersey Tax Court’s Decision in IP Holding Company Nexus Case
Posted on 19 Mar 2019 by Eversheds Sutherland LLP

The New Jersey Tax Court denied a holding company’s motion for partial summary judgment seeking a determination that the taxpayer lacked nexus with New Jersey and would not be required to file corporation business tax returns. The taxpayer’s only connection... Read More

New York City Tax Tribunal finds that ownership of a flow-through interest can create nexus.
Posted on 13 Mar 2019 by Eversheds Sutherland LLP

The New York City Tax Tribunal held that an out-of-state corporate taxpayer, with an indirect interest in a limited liability company investment fund engaged in business in New York City, had nexus with the City and was subject to tax on capital gain... Read More

Missouri Director of Revenue Finds Sales Fulfilled and Shipped from Warehouse in Missouri Subject to Sales Tax.
Posted on 31 Jan 2019 by Eversheds Sutherland LLP

The Missouri Department of Revenue, in a letter ruling, found that a taxpayer’s sales of exercise products were subject to state and local sales taxes because the transactions were not in commerce, since the orders were fulfilled and shipped to Missouri... Read More

California FTB Confirms Delivery by Private Vehicles Is Protected Under P.L. 86-272
Posted on 19 Jan 2019 by Eversheds Sutherland LLP

In a Technical Advice Memorandum issued on December 4, 2018, the California Franchise Tax Board (FTB) concluded that delivery of tangible personal property via private truck is a protected activity under P.L. 86-272. However, any activity that goes beyond... Read More