Shaking things up in state and local tax
Shaking things up in state and local tax
On October 1, 2026, the Tax Court of New Jersey ruled against the American Catalog Mailers Association (ACMA) in its challenge to the Division of Taxation’s 2025 regulations addressing when internet activity conducted by a foreign corporation within New Jersey exceeds the protections of Public Law 86-272.
Public Law 86-272 is a federal law that…
Virginia has a longstanding administrative policy requiring blended apportionment for corporate partners of partnerships engaged in business in the Commonwealth. A Virginia Department of Taxation bulletin changed that treatment relating to non-unitary partnerships.
In 2024, the Virginia Court of Appeals in Commonwealth v. FJ Management, Inc. ruled that a corporate partner (LLC member) that was…
The Alabama Court of Civil Appeals affirmed a trial court’s determination that Pfizer could not deduct interest paid to its related Irish affiliate, finding that the “subject-to-tax exception” did not apply. Alabama requires the add back of interest payments made to a related party unless an exception applies. The taxpayer claimed that Alabama’s subject-to-tax exception…
The South Carolina Court of Appeals held that the South Carolina Department of Revenue properly required a retailer and its subsidiaries to file on a combined basis. In 2001, the retailer was restructured to create two affiliated subsidiaries. One of the subsidiaries engaged in inventory procurement for the other entities. Only the parent retailer entity…
On April 2, 2026, the Supreme Judicial Court of Maine ruled that a liquor supplier was subject to Maine income tax and owed nearly $750,000 in state income tax, penalties, and interest for the 2011-2017 tax years.
The liquor supplier argued that it was not subject to income tax because it did not have nexus…
The Florida Second Judicial Circuit granted summary judgment in favor of Checkfree Services Corporation, finding that Florida’s corporate income tax cost of performance apportionment rule required the sourcing of receipts from Checkfree’s online bill pay services based on Checkfree’s own transactions and activities.
Checkfree acted as an agent for financial institution clients and facilitated online…
The Pennsylvania Commonwealth Court found that while a three-year statute of limitations generally governs the time for taxpayers to file a refund, a separate, more specific statute of limitations applies when a corporate taxpayer’s request for a refund is precipitated by a change to taxable income made by the IRS. The Court explained that the…
The Massachusetts Appellate Tax Board (ATB) found that an out-of-state footwear company qualified as a “manufacturing corporation” for purposes of the state corporate excise (income) tax despite outsourcing the manufacturing of its shoes to third parties. The consequence of the “manufacturing corporation” classification was that the taxpayer had to use a single-sales factor apportionment formula…
The Nevada Supreme Court found that the Nevada Department of Revenue’s (Department) attempt to ignore its email correspondence with a taxpayer violated “basic notions of justice and fair play.”
A Nevada statute requires that, in order to file a petition for judicial review of a tax deficiency, a taxpayer must first either pay the entire…
The Merrimack County Superior Court held that the carryback long-term capital losses of one member of a unitary combined group can be used to offset the long-term capital gains of a different member of the group for purposes of computing the group’s Business Profits Tax. The New Hampshire Department of Revenue Administration argued that the…
