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 to the state of New Jersey was the receipt of royalties from an affiliate doing
Income
New York City Tax Tribunal finds that ownership of a flow-through interest can create nexus.
By Chris Lee & Jonathan Feldman on
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 from its sale of the fund. The taxpayer had no property, employees,…
New Jersey Upholds Assessment Addressed to Wrong Taxpayer and Routed to Wrong Location
By Michele Borens & Chris Lee on
Posted in Financial Services, Income
The New Jersey Tax Court rejected a taxpayer’s due process claim finding that the Division of Taxation properly issued the notice of assessment. The taxpayer made three arguments: (1) that the Division issued the assessment in the name of the predecessor corporation instead of the successor corporation, (2) that the assessment was addressed to the…
Louisiana Residents Entitled to Claim Credit for Texas Franchise Tax Paid by Pass-Through Entities
By Justin Stone & Todd Lard on
Posted in In the News, Income
The Louisiana Supreme Court ruled that residents who owned an S corporation and limited liability company were entitled to a credit against their Louisiana income tax liability for Texas franchise tax paid by the pass-through entities. In so holding, the Louisiana Supreme Court found that La. R.S. 47:33, which limits the credit for taxes paid…
Podcast: P.L. 86-272 Protection for Deliveries
By Eversheds Sutherland SALT on
New Mexico Administrative Hearings Office Rejects Department’s Attempt to Eliminate Payroll Factor from Apportionment Factor Calculation
By Open Weaver Banks & Michael Hilkin on
The State of New Mexico Administrative Hearings Office held that the New Mexico Taxation and Revenue Department could not remove the payroll factor from the apportionment factor calculation of a taxpayer in the credit card and personal lending business. The Hearings Office determined that “the party seeking to depart from the proscribed apportionment method,” which,…
California FTB Confirms Delivery by Private Vehicles Is Protected Under P.L. 86-272
By Chris Lee & Charlie Kearns on
Posted in California, Income
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 the scope of delivery, such as backhauling, is not protected. The FTB explained that Congress, when…
Minnesota Tax Court Clarifies R&D Credit Calculation in Identical Cases
By Jessica Eisenmenger & Scott Wright on
Posted in Income, Noteworthy Cases
In two cases, the Minnesota Tax Court clarified the extent to which the Minnesota research and development (R&D) credit is calculated based on the Internal Revenue Code’s defined terms. Minnesota law incorporates the Internal Revenue Code’s definition of “base amount” for purposes of calculating the Minnesota R&D credit. The proportion of qualified research expenditures to…