State and Local Thinking -- June 2015

State and local Thinking - June 2015State and Local Thinking

SALT Alerts
SALT Alerts are available via Twitter.

Utah State Tax Commission rules on freight forwarder apportionment issues
The Utah State Tax Commission released a private letter ruling clarifying the appropriate apportionment methodology for freight forwarders. Read the SALT Alert.

New York State Department of Taxation and Finance determines cloud computing services are not subject to sales and use tax
The New York State Department of Taxation and Finance issued an advisory opinion on April 14 responding to a petitioner’s request regarding whether the sale of a certain cloud computing product was subject to New York State sales and use tax. Read the SALT Alert.

Nevada enacts budget bill including new commerce tax
Nevada Gov. Brian Sandoval signed legislation on June 9 that imposes a new commerce tax on businesses with more than $4 million in annual Nevada gross revenue beginning on July 1, 2015. Read the SALT Alert.

Minnesota upfront capital equipment sales tax exemption to become effective soon
For purchases made after June 30, 2015, Minnesota businesses will be able to purchase capital equipment exempt from sales tax. Read the SALT Alert.

Maryland Tax Court again subjects affiliated taxpayers to corporate income tax with 'fair' apportionment
The Maryland Tax Court has determined that a multistate retailer and its subsidiary engaged in substantial intercompany transactions with each other, as well as other members of an affiliated group, and were subject to Maryland corporation income taxes. Read the SALT Alert.

Washington Court of Appeals holds business could not dissociate activities from sales to avoid B&O tax nexus
The Washington Court of Appeals has held that a business had substantial nexus for purposes of the state’s Business and Occupation (B&O) tax for the sale of goods delivered to Washington addresses even though the activities of its office in the state were not directly connected to the sales. Read the SALT Alert.

Nevada enacts rebuttable presumption of sales and use tax nexus
Nevada Gov. Brian Sandoval signed legislation on May 27 that includes click-through nexus and affiliate nexus provisions for purposes of the state’s sales and use tax. Read the SALT Alert.

Michigan Court of Claims reconsiders and rules against IBM in Multistate Tax Compact three-factor apportionment case
In the ongoing drama surrounding the ability to elect to use the Multistate Tax Compact’s three-factor apportionment formula for purposes of the Michigan business tax, the Michigan Court of Claims has granted the Michigan Department of Treasury’s motion for summary disposition, denying IBM’s election for purposes for the 2008 tax year. Read the SALT Alert.

Texas Supreme Court declines to review Titan Transportation decision
The Texas Supreme Court has declined to review the Texas Court of Appeals’ decision in Titan Transportation, LP v. Combs, which held that a taxpayer may exclude subcontractor payments as flow-through funds from its total revenue for revised Texas franchise tax purposes. Read the SALT Alert.

Texas Appellate Court addresses potential application of COGS deduction to service providers and sellers of intangible property
The Texas Court of Appeals for the Third Appellate District recently upheld a trial court’s determination that a movie theater was entitled to take a deduction for cost of goods sold in computing its margin for the revised Texas franchise tax. Read the SALT Alert.

South Carolina Administrative Law Court interprets income-producing activity method to require market-based sourcing
The South Carolina Administrative Law Court on May 12 rejected a taxpayer’s attempt to source subscription receipts from South Carolina customers outside of South Carolina based on a cost of performance methodology. Read the SALT Alert.

Oklahoma enacts tax amnesty program to begin Sept. 14, 2015
Oklahoma enacted legislation authorizing and directing the Oklahoma Tax Commission to administer a tax amnesty program, termed a “voluntary compliance initiative,” from Sept. 14 to Nov. 13, 2015. Read the SALT Alert.

UTELCOM analysis endorsed in Louisiana franchise tax nexus dispute
In Bridges v. Polychim USA, Inc., the Louisiana First Circuit Court of Appeal overturned a trial court’s summary judgment ruling that an out-of-state corporation was subject to the Louisiana franchise tax and remanded the case to the trial court for further consideration. Read the SALT Alert.

Tennessee enacts major legislation expanding nexus, adopting market-based sourcing
Tennessee Gov. Bill Haslam on May 20 approved legislation, the Revenue Modernization Act, which enacts major amendments concerning excise and franchise taxes, business tax and sales and use taxes.  Read the SALT Alert.

Indiana income and sales tax legislation enacted
Indiana Gov. Mike Pence has signed several bills that significantly change elements of the Indiana income and sales tax laws.  Read the SALT Alert.

South Carolina Department of Revenue issues draft revenue ruling and procedure on alternative apportionment methods including unitary reporting
The South Carolina Department of Revenue issued a draft revenue ruling and revenue procedure relating to alternative apportionment that may significantly apply to taxpayers.  Read the SALT Alert.

Tax webcasts and events
Replay past State and Local Tax webcasts

Webcasts are accessible for one year after the initial broadcast.

The following webcasts are available for replay:
Hot tax issues for short- and long-term assignees
This webcast covers several hot topics including payroll and compliance requirements for short- and long-term assignments between the UK and the United States, taxability and planning points regarding compensation items for such assignees, and pitfalls and opportunities for employers and assignees during such assignments.  Replay the webcast.

Tax accounting quarterly update: June 2015
Learn about developments and significant issues that can affect your financial statements, including accounting for income and nonincome taxes. The webcast focuses on the financial reporting implications of these developments.  Replay the webcast.

Using a family office to accomplish your objectives
Preserving and organizing wealth, managing risk and transferring wealth are common objectives of today’s family offices. It's important to understand the role, structure and functions of a family office.  Replay the webcast.

Next on the tax legislative agenda: Business tax reform or the extenders?
Comprehensive tax reform lowering both individual and corporate rates is all but dead for now, leaving lawmakers to decide whether to pursue “business” tax reform or move on to “extender” tax provisions. Our webcast covers the latest prospect for business reform and what business reform would mean for corporate rates, international tax rules, business tax incentives and pass-throughs.  Replay the webcast.

After the acquisition: Critical actions for tax departments
After an acquisition, the tax department and CFO need to take critical actions related to compliance, software, integration and people. The webcast discusses opportunities for better strategic alignment to ease post-acquisition challenges, as well as critical issues and opportunities in state and local taxation, and compensation and benefits.  Replay the webcast.

Tax professionals
Meet Dana Lance, SALT senior manager in the Miami office
Dana Lance is a SALT senior manager in the Miami office. She provides state tax services for a number of large multistate and multinational private equity firms, while focusing on state and local income and franchise tax.

Dana has in-depth experience working with investment firms and has spent most of her career providing services to the private equity industry, including transactional assistance on the acquisition and disposition of investments, tax due diligence analysis, and post-acquisition integration and compliance work.

Dana earned a master's degree in Taxation from Florida Atlantic University and a BS in Accounting from Barry University.

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This document supports Grant Thornton LLP’s marketing of professional services and is not written tax advice directed at the particular facts and circumstances of any person. If you are interested in the subject of this document, we encourage you to contact us or an independent tax professional to discuss the potential application to your particular situation. Nothing herein shall be construed as imposing a limitation on any person from disclosing the tax treatment or tax structure of any matter addressed herein. To the extent this document may be considered to contain written tax advice, any written advice contained in, forwarded with or attached to this document is not intended by Grant Thornton LLP to be used, and cannot be used, by any person for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.