On Aug. 28, 2017, in California Cannabis Coalition v. City of Upland, the California Supreme Court held local taxes imposed by taxpayers via initiative are subject to less stringent requirements than taxes imposed by local governments pursuant to Proposition 218. In their article for Law 360, Eversheds Sutherland attorneys Eric Coffill and Robert
Virginia Supreme Court Limits Corporate Income Tax Addback Exception
On August 31, 2017, the Virginia Supreme Court issued its opinion in Kohl’s Department Stores, Inc. v. Virginia Department of Taxation, holding that only the portion of royalties that are actually taxed by another state falls within its “subject to tax” exception to Virginia’s addback statute for corporate income tax purposes.
- The Court interpreted
Minnesota Tax Court: Net Operating Loss Limitation is Applied Solely on a Pre-Apportioned Basis
By Debra Salvato and Scott Wright
The Minnesota Tax Court recently held that the annual limitation on net operating losses of an acquired corporation is to be applied only once to a taxpayer’s pre-apportioned income. The taxpayer, Sinclair Broadcast Group, Inc., acquired a company with significant losses to which Section 382 limitations applied. The Commissioner
Minnesota Supreme Court Respects Federal Check-the-Box Election for Minnesota Combined Reporting Purposes
By Samantha Trencs and Jeff Friedman
The Minnesota Supreme Court respected a foreign entity’s federal check-the-box election for the purpose of determining which entities were included in the Minnesota combined franchise tax reports. The court held that including the income and apportionment factors of a foreign entity that elects under federal tax law to be
Arizona Court of Appeals: Failure to Publish Law Change Violates Due Process
By Ted Friedman and Charlie Kearns
On August 3, 2017, the Arizona Court of Appeals held that the issuance of a sales tax assessment by the City of San Luis violated the due process rights of a company that calculated its tax liability based on publicly available versions of the tax code that showed a
Webcast: SALT Scoreboard – 2017 Mid-Year Review
The quarterly Eversheds Sutherland SALT Scoreboard tallies significant state and local tax litigation wins and losses. In this videocast, Charles C. Capouet and Hanish S. Patel share the second quarter highlights from the SALT Scoreboard, including a breakdown of corporate income tax and sales and use tax case results, an overview of the most significant
Roam Where You Want To: City of Seattle Lacks Authority to Tax Foreign Roaming Charges
By Maria Todorova and Suzanne Palms
The Washington Court of Appeals recently held that Seattle could not impose a utility tax on revenue derived from international roaming charges (charges for mobile telephone communications that originate in a foreign country). City of Seattle v. T-Mobile West Corp., No. 75423-8-1 (Wash. Ct. App. May 22, 2017)
New York State Tax Appeals Tribunal: Payments to Captive Insurance Company Did Not Qualify as Deductible Insurance Premiums
By Andrew Appleby and Dmitrii Gabrielov
The New York State Tax Appeals Tribunal released its precedential decision in Stewart’s Shops, affirming an Administrative Law Judge’s determination that payments by a corporation to its captive insurance company did not qualify as deductible insurance premiums because the arrangement did not constitute insurance for federal income tax
Indiana Has Quill in Its Sights
By Maria Todorova and Chris Beaudro
Effective July 1, 2017, Indiana has added an economic nexus provision to its sales tax law. Indiana Code Section 6-2.5-2-1 has been amended to provide that a retail merchant with no physical presence in Indiana must collect sales tax on its sales made into the state if the retail
Texas Supreme Court Upholds Local Ad Valorem Tax on Stored Gas
By Jessie Eisenmenger and Jonathan Feldman
The Texas Supreme Court held that a non-discriminatory tax on stored gas held for future resale does not violate the Commerce Clause of the US Constitution. Harris County imposed an ad valorem tax on natural gas stored in the county on January 1 of the tax year. Applying the