Shaking things up in state and local tax
Shaking things up in state and local tax
By Jessica Kerner and Pilar Mata
The Georgia Department of Revenue determined that a company’s cloud-based applications and related services are not subject to Georgia sales and use tax. The company maintains and operates hardware and software on servers located outside of Georgia that it uses to support its customers’ telecommunications equipment, including voice, video…
By Zachary Atkins & Prentiss Willson
A California Court of Appeal held that a taxpayer who brought a successful facial challenge against a state taxing scheme met all of the requirements for an award of attorney fees and that the trial court abused its discretion by failing to award the fees. The taxpayer, an individual,…
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By Stephen Burroughs and Andrew Appleby
A Vermont Superior Court held that the Commissioner of Taxes unconstitutionally applied the unitary business principle to AIG and its subsidiary, Stowe Mountain Resort. Stowe operates a ski resort, lodging and conference business in Vermont. None of AIG’s other 700 subsidiaries resemble a ski resort, and the Commissioner acknowledged…
By Sahang-Hee Hahn and Pilar Mata
The New Jersey Tax Court ruled for Toyota Motor Credit Corp. on three issues for New Jersey Corporate Business Tax purposes. Specifically, the court upheld the taxpayer’s gain calculation method using an upwardly adjusted federal tax basis; upheld the taxpayer’s departure from federal bonus depreciation rules; and set…
By Ted Friedman and Andrew Appleby
The Indiana Department of Revenue determined that an Indiana taxpayer owed use tax on its rental of equipment from a related entity. After concluding the taxpayer was involved in a retail transaction when it rented equipment from a related entity, the Department imposed use tax on the taxpayer’s storage…
By Stephen Burroughs and Prentiss Willson
Indiana’s Department Revenue determined that the sale of prepaid phone cards and prepaid cell phones are “telecommunication services” subject to Indiana’s Utility Receipts Tax (URT). The URT is an income tax imposed upon the receipts a taxpayer receives from the sale of utility services. Included within utility services are…
By Kathryn Pittman and Andrew Appleby
The Virginia Tax Commissioner determined that an ink manufacturer’s purchase of cleaning chemicals did not qualify for the industrial manufacturing exemption from sales and use tax. To avoid color contamination, the taxpayer had to regularly clean the equipment used to produce the ink with special cleaning chemicals. The taxpayer…
By Stephanie Do and Timothy Gustafson
The Texas Comptroller has filed a reply supporting its petition for review to the Texas Supreme Court in Titan Transp., LP v. Combs, 433 S.W.3d 625 (Tex. App. 3rd 2014). The taxpayer in Titan was in the business of hauling, delivering and depositing aggregate at construction sites, providing…
By Todd Betor and Timothy Gustafson
A California Franchise Tax Board (FTB) Chief Counsel Ruling concluded that a taxpayer’s sales of assets pursuant to a plan of reorganization under Chapter 11 of the U.S. Bankruptcy Code were not “occasional sales” within the meaning of 18 Cal. Code Regs. § 25137(c)(1)(A)2. Instead, the sales of assets…
