Shaking things up in state and local tax
Shaking things up in state and local tax
By Hanish Patel and Eric Coffill
The Alabama Tax Tribunal held that a taxpayer was entitled to a refund of sales taxes paid on purchases of software that was modified for its exclusive use because it constituted nontaxable custom software. Relying on its regulation, the Alabama Department of Revenue (DOR) denied the refund, stating the…
By Jessica Eisenmenger and Todd Lard
The Supreme Court of the State of New York, New York County held that a telecommunications company was liable for both New York City’s Utility Tax and the City’s Unincorporated Business Tax (UBT) because the taxpayer was only lightly regulated by, rather than under the supervision of, the New…
By Nick Kump and Carley Roberts
The Indiana Tax Court held that the plain language of Indiana’s utility receipts tax (URT) does not require taxpayers to separately state taxable and nontaxable receipts on their returns. The URT provides that nontaxable receipts are taxable if such “receipts are not separated from the taxable receipts on the…
By Elizabeth Cha and Charlie Kearns
In Hegar v. CheckFree Serv. Corp., a Texas Court of Appeals affirmed the trial court’s decision and held that the taxpayer’s online bill pay service was not a taxable data processing service for Texas sales tax purposes. Based on the trial court’s uncontested factual findings, the taxpayer provided…
By Stephen Burroughs and Michele Borens
The Circuit Court of Henrico County, Virginia, recently affirmed a ruling by the Commissioner of the Virginia Department of Taxation (Commissioner) that determined a cable provider’s set-top boxes are not “machines” for local property tax purposes and therefore not subject to Henrico County property tax. Virginia statute classifies property…
By Chris Mehrmann and Madison Barnett
The New York State Department of Taxation and Finance issued an advisory opinion explaining that the petitioner’s Internet-based document transfer subscription plans are not subject to sales and use tax. Because the primary purpose of the transactions is to facilitate the transfer of files over the Internet, the Department…
By Evan Hamme and Andrew Appleby
The Oklahoma Supreme Court held that an initiative to amend the state’s constitution does not violate the state’s constitutional rule that a public vote to amend the constitution must address only one general subject (one general subject rule). Although the proposed constitutional amendment contains multiple sections making multiple proposals…
By Hanish Patel and Marc Simonetti
The Florida Department of Revenue (DOR) determined that the sale of certain online membership benefits—early, exclusive access to products and deals and unlimited cloud data storage—were not subject to Florida sales tax or the Communications Service Tax (CST). However, the DOR added that the taxpayer’s purchase of reorder button…
By Jessica Eisenmenger and Amy Nogid
The Florida Department of Revenue determined that software upgrades that are delivered electronically are not subject to sales tax because the upgrade was a stand-alone version of the software and did not rely on the earlier, physically-delivered software to operate. The Department also determined that sales tax does not…
Applying the “true object” test to the taxpayer’s web-based services, the Tennessee Department of Revenue ruled that charges for granting access to the taxpayer’s website for purposes of obtaining information would not be subject to sales tax. While the access to web-based services is tax-exempt as a sale of…
