This podcast discusses issues taxpayers should consider when appealing proposed assessments including:
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The CARES Act provides for special federal tax treatment for “coronavirus-related distributions” from most types of tax-qualified retirement plans and IRAs. The distribution must be made between January 1, 2020 and December 31, 2020 to an individual diagnosed with the virus, caring for a spouse or dependent diagnosed with the virus, or experiencing adverse financial consequences stemming from certain pandemic-related situations (such as quarantine). Income related to those distributions is subject to federal income tax ratably over three years, rather than all at once, unless the individual elects not to have the ratable inclusion apply. However, this favorable tax treatment may not apply for state and local tax purposes.
Read our full legal alert here.
Thank you to everyone who participated in last week’s trivia question!
Last Week’s Question:
What was the first state to adopt a single-factor sales factor formula for apportioning an interstate corporation’s income for state income tax purposes?
The Answer:
The Multistate Tax Compact was drafted in 1966 and became effective, according to its own terms, on August 4, 1967, after a minimum of seven states had adopted it. On April 20, 1967, Kansas became the first state to enact the Multistate Tax Compact, followed shortly after by Washington (June 8, 1967), Texas (June 13, 1967), New Mexico (June 19, 1967), Illinois (July 1, 1967), and Florida and Nevada (August 4, 1967).
Keep an eye out for our next trivia question on Wednesday!
This is the first edition of the Eversheds Sutherland SALT Scoreboard for 2020. Since 2016, we have tallied the results of what we deem to be significant taxpayer wins and losses and analyzed those results. This edition of the SALT Scoreboard includes a discussion of the Seventh Circuit Court of Appeals’ decision on the Tax Injunction Act, insights regarding alternative apportionment, and a spotlight on Washington cases.
View our Eversheds Sutherland SALT Scoreboard results from the first quarter of 2020!
As we continue to follow through on stay-at-home orders, Eversheds Sutherland Associate Lexi Louderback has found a new Rae of sunshine to help keep her occupied. Meet Rae, a 10-week old, golden doodle puppy.
Rae was born right before the stay-at-home order began, so it’s been a challenge to teach her that people other than Lexi exist in the world. The quarantine might have prevented Rae from receiving all of her shots, but that hasn’t stopped Lexi from making sure Rae socializes with others. Each night Lexi and Rae go for a walk, well at least Lexi does. Lexi will carry Rae around the neighborhood and show her that there are other people and dogs. Rae has already become very popular, with neighbors waiting to wave to her from their porch each night. As they’re walking, Lexi will also hold Rae out like Simba at Pride Rock for other dogs walking on the street, so Rae can socialize with them too.
Rae has been very quiet so far, and Lexi keeps losing her around the house. She will find a small area to crawl in and fall asleep, and you can usually find her in the kitchen pantry or under the bed. 
Rae is still a little too young to learn any tricks, but Lexi is working with her on the most important trick of them all – potty training.
We are thrilled to feature Rae as our April Pet of the Month!
Calling all trivia fans! Don’t miss out on a chance to show off your SALT knowledge!
We will award prizes for the smartest (and fastest) participants.
Today’s Question: In 1967, which state became the first to adopt the Multistate Tax Compact?
E-mail your response to SALTonline@eversheds-sutherland.com.
The prize for the first response to today’s question is a $20 UBER Eats gift card.
Answers will be posted on Monday. Be sure to check back then!
This podcast discusses a recent Florida Technical Assistance Advisement concerning the communications services tax treatment of internet-based streaming video.
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On April 28, 2020, the Multistate Tax Commission (MTC), as part of its 2020 Spring Committee Meetings, held its Strategic Planning Committee Meeting by teleconference. Over the prior week, the MTC also held meetings of its Executive, Uniformity, Nexus, and Audit Committees.
The Eversheds Sutherland SALT group attended the Strategic Planning Committee Meeting. During the meeting, the Committee discussed:
The Florida District Court of Appeal affirmed a trial court decision holding that certain online vacation rental platforms (the “Companies”) are not required to collect and remit Palm Beach County’s Tourist Development Tax (“TDT”). The Companies each provide an online platform where property owners can advertise their properties for short-term rentals. The Court explained that the Companies do not own, possess, or have a leasehold interest to convey in any of the properties listed on their online platforms, and that the Companies are simply conduits through which customers can compare properties and rates and book a reservation at the chosen property. Accordingly, the Court concluded that the Companies are not in the taxable business of renting, leasing, or letting transient accommodations as contemplated by the TDT statute. The Court rejected the argument that, because the Companies receive the consideration on the owners’ behalf, they are “dealers” and are required to collect and remit the TDT. The Court explained that a dealer is one who can grant a possessory interest in the property, and reasoned that because the Companies do not own the properties and cannot grant a possessory interest in them, they are not dealers. The Court also determined that the Companies do not act as agents of the property owners for purposes of exercising the taxable privilege of renting.
Gannon v. Airbnb, Inc., No. 4D19-541 (Fla. Dist. Ct. App. Mar. 25, 2020).
Thank you to everyone who participated in last week’s trivia question!
Last Week’s Question:
What was the first state to adopt a single-factor sales factor formula for apportioning an interstate corporation’s income for state income tax purposes?
The Answer:
In 1911, Wisconsin was the first state to formally enact a tax on corporations based on net income (although a few states imposed temporary levies on corporations during the Civil War). Law of July 13, 1911, ch. 658, 1911 Wis. Laws 984.
Since it was imposed on both domestic and foreign corporations, the law also utilized an apportionment methodology using a two-factor formula of “business transacted” and “property located” within the state. See U. S. Glue Co. v. Town of Oak Creek, 247 U.S. 321 (1918) (addressing the constitutionality of Wisconsin’s newly-enacted corporate income tax).
Keep an eye out for our next trivia question on Wednesday!
