On February 6, 2023, the Texas Comptroller of Public Accounts released a memorandum summarizing the internal-use software regulations related to the state’s franchise tax research and development credit and the sales tax R&D exemption. The comptroller significantly revised these regulations in 2021 and then reversed the revisions in 2022, causing confusion among members of the
Water’s-edge combined reports and 80/20 companies
The unitary combined reporting method for state corporate income taxation has been adopted by an increasing number of states. While combined reporting requirements vary significantly from state to state, nearly all combined reporting regimes require or allow a water’s-edge method that limits the members of a group return to entities that are incorporated in the
Texas Talks: Texas Comptroller amended franchise tax sourcing rules is now final
The Texas Comptroller of Public Accounts amended its franchise tax apportionment rule, as published in proposed form in the March 10 issue of the Texas Register. The rule, which is now final, discards the “receipt-producing, end-product act” test in light of Eversheds Sutherland’s litigation in Sirius XM Radio, Inc. v. Hegar. Taxpayers should consider
Massachusetts Supreme Judicial Court holds Massachusetts could not enforce pre-Wayfair computer cookie use tax collection law
On December 22, 2022, the Massachusetts Supreme Judicial Court held that a taxpayer’s use of computer cookies did not constitute substantial nexus with the state for periods prior to the United States Supreme Court’s decision in South Dakota v. Wayfair, Inc. The taxpayer sold auto parts entirely online and utilized cookies to track customers
A failed experiment: New York’s False Claims Act tax meltdown
In this installment of A Pinch of SALT for Tax Notes State, Eversheds Sutherland attorneys Jeff Friedman and Cyavash Ahmadi examine Egon Zehnder, a case they argue demonstrates why New York’s False Claims Act should never have been expanded to tax cases. The case reflects fundamental problems that go to the heart of
Extending by implication – states redefine indirect tax base
State and local authorities recently have used decisions and enforcement to go beyond the language in tax statutes.
In this edition of “A Closer Look” in Bloomberg Tax, Eversheds Sutherland attorneys Jeff Friedman and Liz Cha look at examples of these attempts to expand the tax base and the challenges faced by those who
Landmark state tax cases: A deep dive into Complete Auto Transit v. Brady
This episode of the SALT Shaker Podcast, hosted by Eversheds Sutherland Associate Jeremy Gove, launches a new series in the history of the podcast – discussing landmark tax cases and analyzing their continued impact on state and local tax.
For the first episode of this series, Jeremy welcomes the series’ recurring guest, Partner Jeff
Overrated or underrated? State and local tax edition
In this episode of the SALT Shaker Podcast, Eversheds Sutherland Associate Jeremy Gove welcomes Partner Jeff Friedman for a special edition of the podcast, filled with Jeremy’s favorite concept – is something overrated, or underrated? This time, all of his questions deal with state and local tax, from P.L. 86-272 to digital advertising taxes. Plus,
New York’s false positive: Reforming the False Claims Act
New York is considering expanding its False Claims Act to “knowingly or illegally failing to file” a tax return.
Not only should the legislature reject the proposed legislation, New York should roll back its FCA so it does not apply to taxes.
In this installment of “A Pinch of SALT” in Tax Notes State,
The Texas R&D Credit: Comptroller’s regs could hogtie taxpayers
“Business-friendly” Texas has been the leading poacher of California-based companies for over a decade, with relocations from tech-dominated California only accelerating during the pandemic. Oddly enough, at a time when Texas’s highest-profile new neighbors are known for cutting-edge research, the state seeks to narrow the scope of its research and development credit applicable to some