It has been widely reported that the Minnesota Legislature has advanced an omnibus tax bill that would require the inclusion of the “entire worldwide income” of combined corporate income tax filers engaging in a unitary business. Tax press outlets have made the broad claim that mandatory worldwide combined reporting will “add foreign subsidiaries’ profits” to
Inside SALT
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New York Budget Legislation Contains Significant Tax Provisions
New York Governor Kathy Hochul and the New York State Legislature have reached an agreement on the state’s fiscal year 2024 budget legislation. Most surprisingly, the legislation grants the New York State Department of Taxation and Finance the right to petition for judicial review of New York State Tax Appeals Tribunal decisions that are “premised…
California Supreme Court Lets It Stand That CDTFA Can Decide Who Is and Is Not a Retailer
On April 26, 2023, the Supreme Court of California declined to review the Second District Court of Appeal’s decision in Grosz v. California Dep’t of Tax & Fee Admin. In the underlying case, Stanley Grosz, a business owner based in Fresno, California, filed suit seeking a declaration that the California Department of Tax and Fee Administration (CDTFA)…
Massachusetts Department of Revenue Releases Guidance on a De Minimis Exception for Use Tax on Rolling Stock
The Massachusetts Department of Revenue (DOR) recently released Directive 23-1, which outlines the conditions for a de minimis exception where the Commissioner will not require a taxpayer to pay the use tax for rolling stock used or stored within the state. This directive comes at a time when the DOR is auditing many companies that…
Meaningful Statute of Limitations for Unclaimed Property Audits and Enforcement Actions? Michigan Court of Appeals Says Yes!
On January 19, 2023, the Michigan Court of Appeals affirmed two 2022 trial court orders, holding that initiating an unclaimed property audit does not toll (or freeze) the running of the statute of limitations (time-bar) for the Michigan State Treasurer to commence “an action or proceeding” with respect to a duty of a holder.[1] As…
Pennsylvania Supreme Court Rules Coupon Amounts Are Not Subtracted from Sales Tax Base Unless Sales Receipt Adequately Describes Taxable Item and Coupon
Overturning a 6-1 en banc decision by the Pennsylvania Commonwealth Court, the Pennsylvania Supreme Court held that a coupon does not reduce the price upon which sales tax must be collected unless the coupon is adequately described and “linked” with the taxable item in accordance with Pennsylvania Department of Revenue (DOR) regulations. The case was…
Is California Picking the Pockets of Other States?
In Matter of Body Wise International LLC (OTA Case No. 19125567; 2022 – OTA – 340P), a California-based retailer collected amounts designated as “tax” related to jurisdictions where it was not registered to collect tax. The California Office of Tax Appeals (OTA) held that the retailer must remit those amounts to California, even though the…
More than Tax Compliance: California Legislation Requires Marketplace Facilitators to Track “High-Volume” Seller Information
The responsibilities of marketplace facilitators operating in California are expanding under legislation recently signed by Governor Gavin Newsom. Starting on July 1, 2023, an “online marketplace” will be required to collect and maintain specified contact and financial information related to its “high-volume third-party sellers.” The legislation is intended to “provide greater tools for law enforcement…
Tax That DC?!?! FCA Suit on Residency Brings Business Intelligence Company into the Crosshairs
For the first time since the enactment of the False Claims Amendment Act of 2020, the DC Attorney General’s (AG’s) Office has used its new tax enforcement powers to pursue an alleged personal income tax deficiency. This development brings to the forefront a long-simmering constitutional problem with DC’s statutory residency law and offers a stern…
Fatally Flawed? Illinois Municipal League’s Model Streaming Subscription Tax
The Illinois Municipal League (IML) represents the interests of 219 home rule municipalities in Illinois.[1] The IML recently released a revised draft model, “Municipal Streaming Tax Ordinance,” (the model) for use by the home rule municipalities in imposing an “amusement tax” on, inter alia, music and video streaming services and online gaming.[2] If the subscriber’s…