LexisNexis® Legal Newsroom
New York State Advisory Opinion: Non-US Unauthorized Life Insurance Companies' Premiums Excluded from Apportionment Factor

By Dmitrii Gabrielov and Andrew Appleby The New York State Department of Taxation and Finance issued an advisory opinion determining that non-US unauthorized life insurance companies’ premiums were not includable in the New York State insurance franchise tax apportionment factor. The Department...

California Declines to Extend Landing-Based Situs Property Tax Rule to All Aircraft

By Liz Cha and Carley Roberts The California Court of Appeal held that the entire value of an air taxi company’s jets were subject to the County of Los Angeles 1% personal property tax, despite the fact that the jets spent 40% of their time outside of California. The court reasoned that the brief...

Tennessee DOR Subjects Cloud-Based Employee Scheduling Services to Sales and Use Tax

By Liz Cha and Todd Lard The Tennessee Department of Revenue issued a letter ruling finding that a taxpayer’s annual subscription charge for its cloud-based employee scheduling services is subject to Tennessee sales and use tax. In Tennessee, the use of computer software is subject to tax,...

When Holding On Is Letting Go: Alabama Supreme Court Agrees Holding Title to Goods Delivered into City Insufficient for Purposes of Imposing Municipal Business License Tax

By Mike Le and Tim Gustafson On December 8, 2017, the Alabama Supreme Court issued an order without opinion in Thomas v. Elbow River Marketing Ltd. Partnership , affirming a lower court’s decision that a Canada-based seller of hydrocarbon products did not engage in or carry on a business in the...

Surrender: Minnesota Department of Revenue Gives Away NOL Limitation Case

By Charles Capouet and Charlie Kearns On November 6, 2017, the Minnesota Department of Revenue issued a Revenue Notice advising taxpayers that it acquiesces to the Minnesota Tax Court’s decision in Sinclair Broadcast Group, Inc. v. Commissioner of Revenue . As a result, the Department now takes...

Superior Court of Washington Strikes Down New Income Tax on High Income Residents

By Liz Cha and Eric Coffill The Superior Court of Washington for King County held that Seattle’s new income tax on “high income residents” violates a provision of Washington state law which prohibits a city from levying a tax on net income. On July 14, 2017, Seattle Mayor Ed Murray...

New Jersey Cannot Require an "Addback" of Income Not Included in Federal Taxable Income Because of Treaty Benefit

By Sam Trencs and Open Weaver Banks The New Jersey Tax Court held that New Jersey could not impose corporation business tax on a foreign corporation’s foreign source income that was not included in the federal tax base because of a treaty benefit. Although New Jersey is permitted to adopt a legislative...

Tread Lightly: New Mexico Finds Gain from Stock Sale Is Business Income

By Chelsea Marmor and Charlie Kearns The New Mexico Administrative Hearings Office affirmed the Taxation and Revenue Department’s assessment to Agman Louisiana Inc. based on the taxpayer’s gain from the sale of stock of a corporation in which the taxpayer owned less than a 50% interest...

Eversheds Sutherland SALT Scoreboard Publication--Fourth Quarter 2017

Eversheds Sutherland SALT releases the eighth edition of its SALT Scoreboard, a quarterly publication that tracks significant state tax litigation and controversy developments. This edition of the SALT Scoreboard includes our year-end observations for 2017, a discussion of the Pennsylvania Supreme Court’s...

Missing Proof, Protest Denied: Indiana Finds Throwback Proper Where Manufacturer Fails to Substantiate Taxability

By Mike Le and Open Weaver Banks The Indiana Department of State Revenue issued a Letter of Finding denying a taxpayer’s protest of throwback sales because the taxpayer failed to substantiate being subject to tax in multiple jurisdictions. For income tax purposes, Indiana requires the throwback...

Detroit City Blues: Michigan Court of Appeals Holds Law Firm's Services Excluded from Sales Factor Numerator

By Charles Capouet and Scott Wright The Michigan Court of Appeals held that sales of a Detroit attorney’s services can be included in the sales factor numerator for the Detroit income tax only if the client received the services in Detroit. The Detroit income tax apportions income by a three...

Webcast: South Dakota v. Wayfair – Insights on the Oral Argument

On April 17, 2018, the US Supreme Court is poised to hear oral arguments in the case of South Dakota v. Wayfair. The Wayfair case will re-examine the 1992 holding of Quill v. North Dakota, in which the US Supreme Court ruled that states could not compel mail order retailers that lack a physical presence...

South Dakota v. Wayfair – Insights and Analysis

On April 17, the US Supreme Court heard arguments in South Dakota v. Wayfair, a case involving the states’ authority to tax online purchases. This is the first sales tax jurisdiction case heard by the US Supreme Court in 25 years and may have a significant impact on online sales across the country. About...

Eversheds Sutherland SALT Scoreboard Publication–First Quarter 2018

Eversheds Sutherland SALT releases the ninth edition of its SALT Scoreboard, and the first of 2018. Each quarter, we tally the results of what we deem to be significant taxpayer wins and losses and analyze those results. This edition of the SALT Scoreboard includes insights regarding New Jersey’s attempted...

Pennsylvania Court Finds Wholesaler of Electricity Subject to Gross Receipts Tax

The Commonwealth Court of Pennsylvania affirmed a decision by the Board of Finance and Revenue that found American Electric Power Service Corporation (“Taxpayer”) was subject to Pennsylvania’s gross receipts tax as a wholesale seller of electricity. The Taxpayer presented two substantive arguments, both...

New Mexico Finds No Obstacle to Inclusion of Foreign Dividends and Subpart F Income in Consolidated Return Base

The New Mexico Administrative Hearings Office affirmed the Taxation and Revenue Department’s assessment based on General Electric’s exclusion of foreign dividend and Subpart F income from its base income in its New Mexico consolidated return. In this case of first impression, the Hearings Office held...

Oregon Deems Amendments to Statutory State Apportionment Formulas to Be Constitutional

In another of the so-called “Compact” cases, the Oregon Supreme Court affirmed the decision of the Oregon Tax Court and held that: (1) the 1967 Oregon Legislature, in enacting Oregon Statute Section 305.655, did not clearly and unmistakably intend for Oregon to enter into a binding contract that would...

Oregon Imposes 911 Tax on Out-of-State Retailer with No Physical Presence

The Oregon Tax Court held that the state was not constitutionally prohibited from imposing its statewide 911 tax on an out-of-state VOIP service provider with no physical presence in the state. The court held that the 911 tax was not a sales or use tax because it was not measured by sales price (rather...

Maryland’s Limited Interest on Wynne Refunds Ruled Unconstitutional

Maryland Tax Court holds that Maryland’s limitation of interest on refunds resulting from the US Supreme Court’s decision in Comptroller of the Treasury of Maryland v. Wynne violates the US Constitution. In 2014, the Maryland legislature passed a law to retroactively limit the statutory interest rate...

Chicago Streaming Video Tax Does Not Violate Federal and State Law

On May 24, 2018, the Circuit Court of Cook County upheld the City of Chicago’s imposition of its amusement tax on streaming services. On June 9, 2015, the Chicago Department of Finance issued a ruling indicating that electronically delivered amusements are subject to the amusement tax. The circuit court...

New Jersey Court Holds That Taxpayer Not Entitled to Exception to State’s Interest Add-Back Requirement

In Kraft Foods Global, Inc. v. Director, Division of Taxation, 2018 WL 2247356 (May 17, 2018), the New Jersey Superior Court, Appellate Division, recently upheld a New Jersey Tax Court decision denying a taxpayer an exception to the state’s interest add-back requirement in determining the taxpayer’s...

US Supreme Court Overrules Physical Presence Standard, Leaves Plenty of Questions

In a 5-4 decision, the US Supreme Court today overruled its landmark decisions in Quill Corp. v. North Dakota and National Bellas Hess, Inc. v. Department of Revenue of Illinois, disposing of the “physical presence” rule that has served as the bright-line standard for whether remote sellers are required...

Giving Credit Where It Isn’t Due: Arkansas Office of Hearings and Appeals Treats Sales of Tax Credits as Business Income

On June 13, 2018, an Arkansas Administrative Law Judge concluded that a taxpayer’s proceeds from dispositions of tax credits were apportionable business income. In Arkansas, business income arises from either: (1) transactions and activity in the regular course of the taxpayer’s business (the transactional...

North Carolina Supreme Court Decides in Favor of Taxpayer in Trust Nexus Dispute

The North Carolina Supreme Court recently held that the presence in the state of a trust’s beneficiary is not sufficient to establish income tax nexus for the trust. In the Kimberly Rice Kaestner 1992 Family Trust case, the trust’s beneficiaries were residents of North Carolina. There were no other connections...

Eversheds Sutherland SALT Scoreboard Publication–Second Quarter 2018

This is the tenth edition of the Eversheds Sutherland SALT Scoreboard, and the second edition of 2018. Each quarter, we tally the results of what we deem to be significant taxpayer wins and losses and analyze those results. This edition of the SALT Scoreboard includes a discussion of the United States...