Shaking things up in state and local tax
Shaking things up in state and local tax
On June 5th, the Maryland Court of Appeals held that a reduced interest rate on refunds paid to taxpayers as a result of the U.S. Supreme Court’s decision in Comptroller of Maryland v. Wynne did not violate the U.S. Constitution’s dormant Commerce Clause.
In 2018, the U.S. Supreme Court held that a Maryland statute that…
The North Carolina Supreme Court affirmed a lower court decision that held that a manufacturer of brake pads used by railroads did not qualify for an exception to the state’s standard three-factor apportionment formula that allows “public utilities” to instead apportion their income using a single-sales factor formula.
In February 2019, the North Carolina Superior…
On May 22, 2020, the Idaho Supreme Court held that the gain realized by a corporate holding company on the sale of its 78.54 percent ownership interest in an LLC was nonbusiness income and therefore not subject to apportionment in Idaho. The LLC was formed in 2003 and manufactured and sold tangible personal property. The…
On June 18, 2020, the Ohio Court of Appeals held that Cincinnati’s excise tax on the gross receipts generated by billboards does not violate the First Amendment to the United States Constitution. The court found persuasive Clear Channel Outdoor, Inc. v. Director, Department of Finance of Baltimore, 223 A.3d 1050 (Md. Ct. Spec. App.…
On June 12, 2020, a federal court partially denied Kroger Co.’s motion to dismiss a putative class action complaint regarding Oregon’s bottle deposit on beverages. The complaint alleged that Kroger had misrepresented the cost of certain beverages by charging a ten-cent bottle deposit for beverages that were exempt from the bottle deposit and failing to…
The Alabama Tax Tribunal held that a taxpayer’s payments to an affiliated entity for employee services were not included in the payroll factor of the apportionment formula for business-income tax purposes because the payments were not made directly to the taxpayer’s employees.
During the years at issue, an Alabama regulation stated that only amounts paid…
The South Carolina Court of Appeals affirmed the Administrative Law Court’s holding that proceeds from a book retailer’s sales of book club memberships should have been included in the retailer’s “gross proceeds of sales” and subject to sales tax. The Court of Appeals concluded that South Carolina case law provides that the gross proceeds of…
The Maine Supreme Judicial Court recently held that a taxpayer was not entitled to alternative apportionment for approximately $3 billion in gains earned from the sale of a business unit.
The taxpayer was a food and beverage manufacturer that sold its frozen pizza division in 2010 for $3.6 billion. The taxpayer took the position on…
The Ohio Board of Tax Appeals (BTA) affirmed the Cleveland Board of Income Tax Review’s (Board) decision that it properly denied a refund claim of municipal income tax paid on income from stock options that a nonresident was granted while working in the city but exercised after she retired and moved to Florida. Willacy v.
The Tennessee Court of Appeals held that a manufacturer’s proceeds from a legal malpractice action are business earnings subject to the Tennessee excise tax. The malpractice action arose when the taxpayer’s attorneys improperly filed a European patent. The damages awarded in settlement of the claim were based on profits the taxpayer would have earned if…
