Initially enacted as a temporary measure, Congress made ITFA permanent in 2016 to reflect the enduring federal commitment to preserve a tax-neutral digital infrastructure and protect an evolving digital economy. Indeed, today’s “internet access” is no longer defined by static homepages and email alone, but by cloud computing, digital advertising ecosystems, streaming platforms, and bundled online services. As states seek new revenue sources, they are increasingly reinterpreting – and at times, ignoring – ITFA’s protections to capture taxes on these modern digital offerings.

In this installment of “A Pinch of SALT,” published by Tax Notes State, Eversheds Sutherland attorneys Charlie Kearns, Maria Todorova and Olivia Dibb analyze the evolving legal landscape of ITFA, including how states are testing federal protections in pursuit of digital revenue and how courts are responding to the challenges of a rapidly transforming digital economy.

Read the full article here.

In this episode of the SALT Shaker Podcast, SALT Counsel Jeremy Gove and Chelsea Marmor break down key New York tax and administrative developments shaping 2025.

Their discussion includes:

  • The proposed agenda of the incoming New York City mayor
  • Significant personnel and administrative changes in New York City
  • Recent court rulings on the retroactivity of the corporate income tax regulations
  • Emerging tax revenue streams from legalized casinos and congestion pricing

They wrap up with two thought-provoking questions in the overrated/underrated segment – don’t miss it!

For questions or comments, email SALTonline@eversheds-sutherland.com. Subscribe to receive regular updates hosted on the SALT Shaker blog.

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The Missouri Court of Appeals, Eastern District, held that Jefferson City could not proceed with its collection action against Sprint, T-Mobile, US Cellular, AT&T, and Verizon affiliates for delinquent business license taxes. The court held the city lacked standing because, under Missouri law, suits against telecom companies must be brought by a “person” or “corporation,” and a municipality did not qualify as either. Furthermore, the court held the city did not follow the proper statutory procedure required under Missouri law to notify the companies of the alleged tax underpayments before initiating a lawsuit. Missouri law requires an assessment of back taxes due and a formal notification to the delinquent taxpayer. Although the city claimed it conducted a tax assessment, nothing in the city’s petition indicated the city notified the companies of such assessment. Accordingly, the court held that the city was procedurally barred from pursuing its collection suit.

City of Jefferson v. Sprint Commc’ns, Inc., No. ED113433 (Mo. Ct. App. E.D. Dec. 2, 2025).

Calling all trivia fans! Don’t miss out on a chance to show off your SALT knowledge!

We will award a prize for the smartest (and fastest) participant.

This week’s question: A tax appeals tribunal of what city recently held that a taxpayer could take an unincorporated business tax deduction for interest expenses that were deductible at the federal level?

E-mail your response to SALTonline@eversheds-sutherland.com.

The prize for the first response to today’s question is a $25 UBER Eats gift card. This week’s answer will be included in our SALT Shaker Weekly Digest, distributed on Saturday. Be sure to check back then!

The third quarter of 2025 saw notable activity in New York tax law, including new appointments, regulatory changes, and key decisions.

In this installment of NY Tax Talk, a quarterly column in Law360 focused on recent developments in New York tax law, Eversheds Sutherland attorneys Liz Cha and Periklis Fokaidis highlight the filling of ALJ vacancies at the New York City Tax Appeals Tribunal, the release of proposed corporate tax regulations, ongoing litigation over apportionment rules, and a recent decision on sales tax for bundled software and services.

Read the full article here.

In Guild Mortgage Company v. Washington Department of Revenue, the Washington Board of Tax Appeals considered whether certain fees associated with mortgage sales – guaranty fees, loan-level price adjustments (LLPAs), and lender credits – should be included in the taxpayer’s gross income for purposes of the state’s business and occupation (B&O) tax. 

The taxpayer originated residential mortgage loans and sold most to government-sponsored enterprises (GSEs) such as Fannie Mae and Freddie Mac, which securitize the loans into mortgage-backed securities. To participate in the GSE programs, the taxpayer paid guaranty fees and LLPAs. The taxpayer also sometimes provides lender-paid credits to cover borrower closing costs in exchange for a higher interest rate. Following an audit for 2013–2017, the Department assessed B&O tax on all three of these amounts.

The Board held Guaranty fees and LLPAs are not adjustments to the selling price but are expenses incurred to sell loans to GSEs and thus cannot be deducted under Washington’s B&O tax statute. However, the Board agreed with the taxpayer that lender-paid credits were not taxable because they were a capital investment in the loan.

Guild Mortgage Company v. Washington Department of Revenue, Washington Board of Tax Appeals (Docket No. 20-122, Aug. 29, 2025).

The taxpayers, originally residing in New York, were issued a tax assessment for unpaid income tax but they claimed they moved out of the state and settled in Florida in late 2018 (as part of their retirement plan) while still maintaining living quarters in New York. The taxpayer argued that they had changed their domicile to Florida and as support they presented evidence showing that, among other things, they registered as Florida voters, signed a document declaring themselves domiciled in Florida, obtained Florida drivers’ licenses, registered their vehicles in Florida, joined a country club in Florida, and became involved in their Florida condo board. The taxpayers also spent most of the days during the winter months in Florida. However, the taxpayers still maintained connections with New York including having two country club memberships, spending a significant amount of days in New York during the summer months, and one of the taxpayers still owned and collected a salary from a business located in New York. In 2018, the taxpayers spent 132 days in Florida, 195 days in New York (notably in excess of the 183-day statutory residency test), and 38 days in other locations. While in 2019, the taxpayers spent 155 days in Florida, 170 days in New York, and 40 days in other locations.

The Tax Appeals Tribunal upheld the assessment, agreeing with the Division of Taxation that the taxpayers had not completed their change of domicile during the tax periods at issue. The Tribunal noted that “formal declarations of domicile, such as voter registration or motor vehicle registration, have lost their importance in recent years as courts have recognized their self-serving nature[.]” The Tribunal found that the taxpayers continued to have “substantial ties” to their New York businesses and spent a significant amount of time, including holidays, at their “substantial property” in New York which they previously used as their main home in prior years. The Tribunal concluded that, based on this evidence, the taxpayers had “failed to established by clear and convincing evidence” that they had changed their domicile to Florida during the tax periods at issue.

Matter of the Petition of John J. Hoff and Kathleen Ocorr-Hoff, DTA No. 850209 (Oct. 9, 2025).

This week, members of our SALT team are pleased to join the NYU School of Professional Studies’ 44th Institute on State and Local Taxation, held December 8-9 in New York City. The Institute will provide insightful updates, practical advice, and in-depth analysis of the latest developments and current issues in state and local taxation. The full agenda can be found here.

Sessions featuring members of our team include:

  • Constitutional Limitations on State Taxation – Jeff Friedman
  • The Top Ten (Non-Constitutional) Cases – Maria Todorova
  • TaxTok – A Jurisdictional Tour – Jeremy Gove

Eversheds Sutherland is a proud sponsor of the Institute on State and Local Taxation. We hope to see you there!

Our December SALT Pets of the Month are one stylish flock! This feathered family, belonging to Partner Todd Betor, was inspired by a touch of royalty. After binge-watching With Love, Meghan, Todd’s wife, Michelle, decided it was time to make her backyard chicken coop dream a reality.

The first step? Designing a home fit for the flock. With help from a local company, the Betors created a custom-built coop featuring a Dutch door, an automatic sleeping-area door, and even a rainwater collection system for the flock’s water bar. It’s as elegant as it is functional.

For the Betor family, these chickens are a source of calm and connection. Todd and Michelle’s kids love greeting their feathered friends each morning, and with three of the hens now laying eggs, farm-fresh breakfasts have become commonplace in their house.

Meet the Nantucket-inspired flock:

  • Nantucket Nancy
  • Whaling Willow
  • Harbor Henrietta
  • Sconset Sally
  • Cliffside Clara
  • Grey Lady

From their chic coop to their charming names, Todd and Michelle’s chickens remind us that joy often comes with feathers!

Calling all trivia fans! Don’t miss out on a chance to show off your SALT knowledge!

We will award a prize for the smartest (and fastest) participant.

This week’s question: The legislature of which midwestern state recently proposed a sales and use tax exemption for nuclear fusion technology projects?

E-mail your response to SALTonline@eversheds-sutherland.com.

The prize for the first response to today’s question is a $25 UBER Eats gift card. This week’s answer will be included in our SALT Shaker Weekly Digest, distributed on Saturday. Be sure to check back then!