Click here to read our May 2014 posts or read each article by clicking on the title. A printable PDF is also available here. To read our commentary on the latest state and local tax developments as they are published, be sure to download the Sutherland SALT Shaker mobile app.
- Class Dismissed: Target Takeout Coffee Sales Class Action Suit Thrown Out in California
The California Supreme Court held that the state’s tax code provides the exclusive remedy for a dispute over the applicability of the state sales tax to retail transactions, and thus a class of plaintiffs was precluded from seeking a refund from Target, Inc. for erroneously collected sales taxes on takeout coffee sales.
- Indiana Determines Combination Is Justified, But Alternative Methodology Must Be Considered
The Indiana Department of Revenue determined that an audit correctly required a distribution and manufacturing subsidiary of a tobacco company to file a combined return with its corporate affiliates.
- SALT Pet(s) of the Month: Sherman, Flash and Olsen
Meet Sherman, Flash and Olsen, a loving trio of pups belonging to Kristina Newton from Hewlett-Packard.
- All a Loan? Factoring Arrangement Does Not Create Nexus with Indiana
The Indiana Department of State Revenue determined that a corporation that entered into a factoring arrangement with its parent did not have nexus for Indiana Financial Institutions Tax purposes.
- Louisiana Supreme Court: Department of Revenue Cannot Ignore SMLLC’s Separate Existence
The Louisiana Supreme Court rejected the Louisiana Department of Revenue’s attempt to look through a foreign single member limited liability company (SMLLC) and assess its owner for unpaid sales tax.
- Communication Breakdown: Taxable Service Taints Installation Charge in Maine
The Maine Board of Tax Appeals determined that a non-itemized installation charge was subject to the service provider tax when a portion of the charge included the installation of telecommunications equipment.
- Rent-A-Member: Oregon Tax Court Rules Taxpayer Unitary with Its Captive Insurance Subsidiary but Not Its Franchising Subsidiary
The Magistrate Division of the Oregon Tax Court held that for the tax year 2003, (1) Rent-A-Center, a rent-to-own operator, and its wholly-owned franchising subsidiary, ColorTyme, were not unitary; (2) ColorTyme did not have nexus with Oregon; and (3) Rent-A-Center and its captive insurance subsidiary, Legacy Insurance Co. (Legacy), were unitary.
- Texas Comptroller Short Circuits Manufacturing Exemption of Design Evaluation Software Purchases
The Texas Comptroller determined that an integrated circuit manufacturer’s purchases of software tools used to design and test the software code embedded in its semiconductor chips did not qualify for the manufacturing exemption for sales and use tax purposes.
- Rumor Has It: IT USA Wins on Decombination at New York Tax Appeals Tribunal
The New York State Tax Appeals Tribunal ruled the New York State Department of Taxation and Finance could not decombine taxpayers’ New York combined filing group for tax years 2002-2004.