Shaking things up in state and local tax
Shaking things up in state and local tax
By Todd Betor
A nonresident corporation requested a ruling from the Virginia Tax Commissioner as to whether the corporation was required to withhold Virginia state income tax and pay Virginia unemployment insurance for an employee who worked and resided in Virginia. The employee’s in-state activities consisted solely of performing legal services on behalf of the…
By David Pope and Andrew Appleby
The New Jersey Tax Court denied three summary judgment motions in the ongoing Whirlpool litigation relating to nexus and the “Throwout Rule.” In 2011, the New Jersey Supreme Court held that New Jersey’s Throwout Rule was facially constitutional but narrowed the application of the rule to untaxed receipts from…
By Kathryn Pittman and Andrew Appleby
The Virginia Tax Commissioner found that a corporation with a single employee in Virginia who conducted work-related activities from a home office had nexus for corporate income tax purposes. The taxpayer, headquartered outside of Virginia, had one employee who conducted training at various facilities outside Virginia, but also developed…
In a 6-1 decision, the Illinois Supreme Court affirmed an Illinois Circuit Court holding that Illinois Public Act 96-1544 (The Click-Through Nexus Act), requiring out-of-state retailers to collect and remit use tax, violates the Internet Tax Freedom Act. Performance Marketing Ass’n v. Hamer, Docket No. 114496 (Oct. 18, 2013).
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By Saabir Kapoor and Andrew Appleby
After the U.S. Court of Appeals for the Tenth Circuit denied an en banc rehearing on October 1, 2013, the Direct Marketing Association (DMA) is expected to bring suit in Colorado District Court to challenge the constitutionality of the Colorado law that requires out-of-state retailers without a physical presence…
By Kathryn Pittman and Andrew Appleby
A Washington Superior Court held that using leased specialized railroad cars to transport products in Washington did not rise to the level of “substantial nexus.” The taxpayer, a California company, sold food products into the state by transferring its products into specially leased railroad cars that traveled to Washington.
During the Multistate Tax Commission’s Annual Conference and Committee Meetings in San Diego on July 22, 2013, the Income and Franchise Tax Uniformity Subcommittee discussed its effort to redesign the financial institution apportionment rules. In addition, the Sales and Use Tax Uniformity Subcommittee will move forward in drafting a model nexus statute.
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By Sahang-Hee Hahn and Jack Trachtenberg
The Missouri Department of Revenue determined that an out-of-state provider of mail systems products had nexus for sales and use tax purposes due to the selling activities of dealers in the state. The taxpayer sold products that enabled customers to centralize the distribution and collection of their mail and…
By Shane Lord and Andrew Appleby
The California Superior Court ruled that certain special purpose entities (SPEs) owned by Harley-Davidson, Inc. had nexus in California. The taxpayer formed the SPEs as securitization subsidiaries, which the court held were subject to California income taxation because the SPEs: (1) were “financial corporations” under California law; and (2)…
By Madison Barnett and Prentiss Willson
The Florida Department of Revenue, adopting a recommended order of the Division of Administrative Hearings, ruled that a Georgia-based heavy equipment dealer had substantial nexus in Florida based on its delivery of equipment in company-owned trucks and its advertising in a Florida trade publication. The company’s contacts with Florida…
