Shaking things up in state and local tax
Shaking things up in state and local tax
By Charles Capouet and Open Weaver Banks
The Kansas Department of Revenue addressed the taxability of sales of video game access codes, subscription cards, point cards, and notional dollar value cards. Initial sales of access codes that allow customers to download video games or video game add-ons directly to the customer’s computer or other device…
By Stephen Burroughs and Open Weaver Banks
The South Carolina Department of Revenue requested public comment on a draft Revenue Ruling and a draft Revenue Procedure that detail how it will prospectively apply alternative apportionment to multistate taxpayers. This represents the Department’s second attempt at drafting alternative apportionment guidance (previous coverage). The Ruling describes…
By Charles Capouet and Madison Barnett
The Florida Department of Revenue determined that a Florida data center’s power fees are not subject to gross receipts tax but may be subject to sales tax. The taxpayer operates a colocation data center and purchases electricity to power the data center from a utility. The taxpayer’s customers have…
By Jessie Eisenmenger and Timothy Gustafson
The Missouri Supreme Court held that charges paid by a personal training company to a gym for the rental of office space and limited use of the fitness equipment when conducting personal training sessions are not subject to sales tax. The personal training company paid the gym $6,000 per…
By Charles Capouet and Open Weaver Banks
The Alabama Department of Revenue has proposed an amendment to the state’s rental tax regulation. If finalized, the regulation would tax the rental of “digital transmissions,” such as “on-demand” movies, television programs, streaming video, streaming audio and other similar programs, regardless of the method of transmission or the…
By Jonathan Maddison and Timothy Gustafson
The Indiana Department of Revenue determined that forced combination of an Indiana taxpayer, its wholly owned disregarded entity and its out-of-state parent company was appropriate where the disregarded entity generated 92% of the federal consolidated group’s sales but only 0.14% of the consolidated taxable income for the taxpayer. The…
By Zachary Atkins and Andrew Appleby
The Indiana Department of State Revenue upheld an audit determination that an intellectual property arrangement between a parent company and its wholly owned subsidiary distorted the parent company’s income. The parent company, a separate-return filer for Indiana, adjusted gross income for tax purposes, and transferred to the subsidiary, in…
By Evan Hamme and Madison Barnett
The Washington State Department of Revenue (DOR) issued an Excise Tax Advisory (ETA) making clear that Getty Images (Seattle), Inc. v. City of Seattle, 260 P.3d 926, 163 Wash. App. 590 (Wash. Ct. App. 2011), does not represent a major departure from established law in the context of…
By Charles Capouet and Timothy Gustafson
The South Carolina Administrative Law Court found that South Carolina does not source sales of services with a strict cost of performance method. The taxpayer, a broadcasting corporation, provides access to digital television entertainment via satellite dishes across the United States, including South Carolina. On audit, the South Carolina…
By Derek Takehara and Andrew Appleby
The New Mexico Department of Taxation and Revenue granted a combined reporting group’s corporate income tax protest by allowing the group to claim a deduction for net operating losses (NOLs) that two of its members generated and reported previously on a separate entity basis. The taxpayer was the parent…
