Shaking things up in state and local tax
Shaking things up in state and local tax
By Zachary Atkins and Prentiss Willson
A Texas administrative law judge ruled that a taxpayer was not entitled to make an alternative three-factor apportionment election under Article IV of the Multistate Tax Compact (Compact) for Texas franchise tax purposes. The Texas Tax Code requires taxpayers to use a single gross receipts factor to apportion taxable…
By Shane Lord and Andrew Appleby
The California Superior Court ruled that certain special purpose entities (SPEs) owned by Harley-Davidson, Inc. had nexus in California. The taxpayer formed the SPEs as securitization subsidiaries, which the court held were subject to California income taxation because the SPEs: (1) were “financial corporations” under California law; and (2)…
By Sahang-Hee Hahn and Pilar Mata
The California Supreme Court held that taxpayers may file a class action lawsuit to claim a refund of local telephone user taxes (TUT) paid to the City of Long Beach. The taxpayer class alleged that the City unlawfully collected the TUT on services that were determined to be nontaxable…
We invite you to read all of our articles from April 2013 here on our website, or read each article by clicking on the title. If you prefer, you may also view a printable PDF version.
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By Scott Booth and Timothy Gustafson
The Massachusetts Appellate Tax Board ruled that an out-of-state corporation’s subsidiary qualified as a financial institution by virtue of the lending activities undertaken by the trusts in which it held beneficial ownership and from which the subsidiary derived more than 50% of its gross income. Under Massachusetts’ statutory “catchall”…
By Kathryn Pittman and Jack Trachtenberg
On April 17, 2013, Select Medical Corporation (Select Medical) filed suit in federal district court seeking to enjoin Delaware from enforcing an unclaimed property assessment issued for years that had been resolved already through the state’s voluntary disclosure program. In 2006, Select Medical entered into Delaware’s voluntary disclosure program…
By Todd Betor and Pilar Mata
In a Letter of Findings, the Indiana Department of Revenue disallowed a corporate partner’s attempt to deduct flow-through income from a limited liability company as “foreign source dividends and other adjustments” on its Indiana corporate income tax return. Indiana requires corporate partners to report their share of partnership income,…
By Christopher Chang and Jack Trachtenberg
The New York State Division of Tax Appeals (DTA) ruled that the dividend income received by a taxpayer holding company from its minority ownership in a publicly traded corporation constituted “investment income” for purposes of New York’s Article 9-A franchise tax on business corporations. The holding company held stock…
By Mary Alexander and Andrew Appleby
The New York State Department of Taxation and Finance determined that a women’s apparel company’s “inspirational shopping” trips were not sufficient to be considered “doing business” in the state for corporate franchise tax purposes. Petitioner was a traditional remote seller headquartered outside of New York. Petitioner’s employees occasionally traveled…
By Zachary Atkins and Timothy Gustafson
The Iowa Supreme Court passed on an opportunity to breathe life into equal protection jurisprudence and, instead, rejected Qwest Corporation’s challenge under the Iowa Constitution to a property tax regime that taxes the personal property of incumbent local exchange carriers (ILECs) but not competitive long distance telephone companies (CLDTCs)…
