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.

This week’s question: Which research expense credit was recently disallowed in an April letter ruling issued by the Indiana Department of State Revenue?

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.

Answers will be posted on Saturdays in our SALT Weekly Digest. Be sure to check back then!

Who can resist a little ball of fluff with blue eyes? Meet Asher, our August Pet of the Month! Asher belongs to Sarah Wellings, Deputy General Counsel and Chief Compliance Officer of The Jackson Laboratory.

A nine-week-old Australian Shepherd, Asher earned his first name, which means “happy” and “blessed,” due to his sweet demeanor and serious face. He joined the Wellings family after an epic eleven hour road trip home to Maine from upstate New York.

Since settling into his new home, he’s been working on his skills, learning how to chase a ball, walk on a leash and keep his humans on their toes! He recently decided a slug was a tasty snack, much to the chagrin of his mom. He also enjoys chewing on Sarah’s fingers, sleeping between the couch and the wall, and cuddling as much as possible.

Once he grows into his paws, Sarah looks forward to taking him hiking through Acadia National Park, going canoeing and teaching him about snacks that are better than slugs.

Welcome Asher to our Pet of the Month family!

 

 

On August 3, 2021, the New Jersey Division of Taxation released guidance on its website informing taxpayers that as of October 1, 2021, the state is ending its temporary waiver of certain corporation business tax (CBT) and sales tax nexus standards necessitated by the COVID-19 pandemic. The temporary guidance allowing employers to source wage income in accordance with an employer’s location will also end. Accordingly, employers generally should resume sourcing income based on where an employee’s service or employment is performed, subject to notable exceptions of any applicable convenience of the employer tests (such as the one adopted by New York State) or reciprocity agreements (such as the agreement in place with Pennsylvania).

The timing of this guidance is somewhat surprising, as in recent weeks a number of companies have pushed back office reopening dates because of concerns related to the COVID-19 Delta variant.

Read the full Legal Alert here.

Between August 11 and 13, members of the Eversheds Sutherland SALT team will help cover the key state and local tax issues technology companies are facing during COST’s virtual 2021 State and Local Tax Webinar for the Tech Industry.

Eversheds Sutherland SALT attorneys are presenting on several topics, including:

  • Transfer Pricing in the Technology Arena – Maria Todorova – Wednesday, August 11 from 1:45-2:50 p.m. ET
  • Beware of the Locals — They Might Take You by Surprise – Tim Gustafson – Wednesday, August 11 from 3:00-4:05 p.m. ET
  • Marketplace Facilitators – SALT Issues – Michele Borens – Wednesday, August 11 from 4:15-5:20 p.m. ET
  • Working at Home and Mobile Workforce – Creation of Issues – Charlie Kearns – Thursday, August 12 from 2:50-3:55 p.m. ET
  • Ask the Experts – Michele Borens – Friday, August 13 from 1:35-3:00 p.m. ET

To register, click here.

On this episode of the SALT Shaker Podcast, Host and Eversheds Sutherland Associate Jeremy Gove is joined by Partner Tim Gustafson to delve into the intricacies of personal income tax, residency and domicile.

The two discuss the numerous tests various jurisdictions use in determining when a taxpayer is a domiciliary, and even when not domiciled in a state, when a taxpayer may still be deemed a resident. They also talk about the various types of information and documentation taxpayers can use to support their change in residency.

Questions or comments? Email SALTonline@eversheds-sutherland.com.

 

 

 

 

 

 

 

 

 

 

 

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The Alabama Department of Revenue issued a notice on July 26, 2021, providing guidance regarding tax compliance requirements for marketplace facilitators operating in the state. Marketplace facilitators provide a platform through which marketplace sellers make sales. A marketplace facilitator that facilitates retail sales of $250,000 or more into Alabama through its platform must register with the Department. Upon registering, marketplace facilitators must either comply with the reporting requirements or collect and remit the Simplified Sellers Use Tax flat rate of 8% on taxable retail sales made through the marketplace facilitator’s platform. Where the marketplace facilitator collects and remits the use tax, the marketplace facilitator, marketplace seller, and purchaser are relieved from any additional state or local sales and use tax on the transactions made through the marketplace facilitator’s platform.

Following a taxpayer’s assessment appeal, the Virginia Tax Commissioner determined that “easy return label” and “merchandise logo charges” were subject to Virginia sales tax.

Easy return labels
The taxpayer was a retailer of products sold online and through catalogs. The taxpayer offered its customers the option of returning merchandise using an “easy return label,” which was shipped with the merchandise. If the customer opted to return the merchandise, the customer would affix the label to the package containing the merchandise to be returned. The taxpayer charged the customer a flat fee for the use of the easy return label, representing the postage cost to ship the returned merchandise.

The Virginia sales tax statute exempts separately stated transportation charges from sales tax. But the Commissioner has adopted a regulation limiting that exemption to only delivery charges for transportation from the seller to the purchaser. In an earlier ruling involving the same taxpayer, P.D. 19-115, the Commissioner determined that the exemption did not apply to the easy return charges because the charge was for transportation from the purchaser to the seller, rather than from seller to the purchaser. On reconsideration, the taxpayer argued that easy return label charges billed to Virginia customers were exempt as the delivery of tangible personal property for use or consumption outside the state. However, the Commissioner concluded that the returned inventory was not subject to a taxable use outside of Virginia; rather, the products were only being returned to inventory. The charges were instead taxable because of their direct connection to the sales to Virginia customers of the returned merchandise.

Merchandise logo charges
The taxpayer offered customers the option of adding customized logos to clothing sold by the taxpayer. The taxpayer argued that the merchandise logo charges were exempt as separately stated charges for clothing alterations. The Commissioner rejected the taxpayer’s argument, adopting a narrow dictionary definition of “alter” as “to adjust (a garment) for a better fit.” As the merchandise logo charges were not adjustments to clothing to ensure a better fit, the Commissioner concluded that the charges did not qualify for the exemption.

Va. Public Document Ruling No. 21-74, Va. Dep’t of Taxation (May 25, 2021).

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.

This week’s question: On a recent podcast, Eversheds Sutherland attorneys Breen Schiller and Jeremy Gove explored transactional nexus. Which North Carolina decision did they analyze in their discussion?

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.

Answers will be posted on Saturdays in our SALT Weekly Digest. Be sure to check back then!