State Tax Alerts - This Week's Stories Worth a Second Look

Rusty Little

In case you missed them, the following is a summary of a few key state tax developments, news articles, and observations during the past week:

U.S. Court of Appeals for the Third Circuit Affirms District Court of New Jersey's Orders - On January 5, 2012, the U.S. Court of Appeals for the Third Circuit (“Third Circuit”) affirmed the District Court of New Jersey’s (“District Court”) grant of preliminary injunction with respect to the retroactive enforcement of Chapter 25 (as it relates to stored value cards) and the prospective enforcement of the place-of-purchase presumption and the accompanying Treasury Guidance. Read more HERE


A few more states have introduced online sales tax/click-through nexus legislation:

• Georgia – click HERE
• Hawaii – click HERE
• Minnesota – click HERE

Two more states have recently addressed the sales tax ramifications of Groupon-type deals:

• Kentucky – click HERE
• Maine (see bottom of page 4) – click HERE

(Note - both Kentucky and Maine treat these deals correctly, unlike the other states discussed HERE)

It has been relatively quiet in the area federal online sales tax legislation, but here is the text of each piece of the currently proposed online sales tax legislation for your reference in the meantime.

Many states have various tax proposals in front of their Legislatures right now, so stay tuned . . .

State Tax Alerts - This Week's Stories Worth a Second Look

Rusty Little

In case you missed them, the following is a summary of a few key state tax developments, news articles, and observations during the past week:

• Simon Property Group sues Indiana over e-commerce sales tax – from Bloomberg Businessweek
• Here's the latest on the Enzi-Alexander sales tax bill (the 3rd online sales tax bill) – from CBS News
• New York Public Employees Federation agrees to wage and benefits concessions. 37 of the 42 New York Department of Taxation and Finance attorneys were to be laid off which would have greatly affected many functions in the Department of Taxation including petitions for advisory opinions - from the New York Times
• Colorado Voters Reject Income and Sales Tax Increase – from the Denver Post
• Illinois H.B. 3869 is introduced to repeal click-through nexus law – from Illinois Representative Dave Winters
• More taxpayers are now eligible for North Carolina VDA program and lookback period changed from 4 years to 3 years – from NCDOR
• Ohio proposed rule on amnesty payment plan is revised – from CCH
• Rhode Island Proposed Reg CT 11-15 requires proforma combined reporting disclosure (even though Rhode Island is separate return state) – from CCH
• Texas: Constitutional challenge to franchise tax filed – from CCH

State Tax Alerts - This Week's Stories Worth a Second Look

Rusty Little

In case you missed them, the following is a summary of a few key state tax developments, news articles, and observations during the past week:

• Two cases were decided in the ongoing sales tax saga between the online travel companies and the states. One in Texas and one in the District of Columbia.
• On the same topic of online travel company sales taxation, South Carolina issued a directive to online travel companies to collect sales tax on gross proceeds and stated that the online travel companies must issue resale certificates to the hotels (kind of interesting when the agreements between the travel companies and the hotels do not require an inventory of rooms to be purchased).
• Interesting case in Indiana where it was decided that the Indiana Department of Revenue must apply all available methods under the statutes before attempting force combination of a taxpayer. AE Outfitters Retail Co. v. Indiana Dept. of State Revenue
• Yet another online retailer sales tax collection bill is about to be introduced (this will be the third) – from the Puget Sound Business Journal

REMINDER: Upcoming Audio Teleconference: EMERGING STATE TAX BATTLEFIELDS Thursday, November 10, 2011 2:00 p.m. - 3:00 p.m. CLICK HERE to register.

State Tax Alerts - This Week's Stories Worth a Second Look

Rusty Little


In case you missed them, the following is a summary of a few key state tax developments, news articles, and observations during the past week:

• Still Alive and Kickin’: “Cost of Performance” Sourcing for Sales - While many states are moving away from the cost of performance approach in favor of marketplace sourcing, cost of performance is still alive and kickin’. Re-discover some of the benefits and considerations of using cost of performance and examine whether an opportunity still exists to take advantage. Read entire SALT To Taste article here.
• The Marketplace Equity Act was introduced to Congress this week. This new online sales tax collection bill differs from the Mainstreet Fairness Act in many ways – from the Tax Foundation Tax Policy Blog
• eBay Voices Disapproval of Current Internet Sales Tax Bills – from eBay’s public policy blog
• The New York Department of Taxation and Finance will eliminate 37 of its 42 in-house legal counsel positions (no, that’s not a typo – this will have major ramifications in a lot of areas) – from timesunion.com
• How will the IRS amnesty program to convert independent contractors to employees affect the state treatment? Article from Forbes
• Harrisburg, Pennsylvania Files for Bankruptcy – from Businessweek

State Tax Alerts - This Week's Stories Worth a Second Look

Rusty Little

In case you missed them, the following is a summary of a few key state tax developments, news articles, and observations during the past week:

Groupon and Living Social are two popular Internet companies offering online discount vouchers for deals at your favorite business establishment.  This business model opens up a can of worms for sales tax - Opening Up A Can Of Worms 
 
The US Supreme Court declines to hear the KFC Corp v. Iowa and Lamtec v. Dept of Rev. of Washington cases - from the Tax Foundation
 
California FTB issues guidance on series LLCs - from TEI's blog
 
SEC/EDGAR filing is considered a "telecommunications service" in Tennessee - from the CCH Community blog

The latest with Amazon:

• Amazon to collect Tennessee sales tax beginning in 2014 and will add 2,000 full-time jobs at new distribution centers - from The Charlotte Observer
• Pennsylvania introduces click-through nexus bill (H.B. 14) - from CCH

State Tax Alerts - This Week's Stories Worth a Second Look

Rusty Little

In case you missed them, the following is a summary of a few key state tax developments, news articles, and observations during the past week:

• SALT To Taste: Missouri Got It Right, But Will It Be Of Any Use? - In a recent decision, the Supreme Court of Missouri ruled in favor of a group of travel companies on a sales tax issue for which the travel companies have had limited success in other states.  Although this was a favorable decision, it is a reminder that these internet service business models are susceptible to attack. See full text of article here.
• California Governor Jerry Brown signs bill (AB 155) to delay "Amazon Law" until September, 2012 - from the LA Times
• Massachusetts and New York address sales tax issues relating to Groupon/Living Social arrangements - Massachusetts Working Draft Directive 11-XX and New York TSB-M-11(16)S
• Colorado amnesty program begins October 1 and runs to November 15 - details from their website

State Tax Alerts - This Week's Stories Worth a Second Look

Rusty Little

In case you missed them, the following is a summary of a few key state tax developments, news articles, and observations during the past week:

• Media continues to misinterpret the Amazon.com saga by depicting the issue as a "loophole" as if abiding by the U.S. Constitution and U.S. Supreme Court decisions is now an aggregious tax strategy.
• SALT To Taste - Well Done New Jersey! - from DLP
• Wal-Mart and Amazon.com - Strange Bedfellows?? - from DLP blog at statetaxalerts.com
• Social Media for Tax Professionals: Is It Time for Firms to Kick the Tires? - DLP article in BNA Tax Management Weekly State Tax Report
• Blog post from TEI summarizing the release of the Congressional Budget Office's cost estimate to the states of the Business Activity Tax Simplification Act of 2011 ("BATSA"). Approximately $2 billion in the first year - read more here
• Council on State Taxation files amicus brief in the Washington Supreme Court arguing that a 24-year retroactive period is unconstitutional - pdf copy of the brief here
• One state's Chamber of Commerce's take on corporate tax rates - “Illinois should never have a higher corporate tax rate than our neighboring states”

Reminder - Dow Lohnes Price recently launched its new website design at www.dlptax.com.  Check it out when you have a minute.

Wal-Mart and Amazon.com - Strange Bedfellows??

Rusty Little

Wal-Mart and Amazon.com probably don't see eye-to-eye on many things because they are in fierce competition in the retail marketplace (nor do any of the other big box retailers and the other large online sellers). 

But arguably, they are in the same boat with regard to many sales tax collection issues.  Beginning yesterday, there have been a lot of stories in the main stream media regarding Wal-Mart not collecting sales tax on certain online sales.  This article from the LA Times attempts to sum up the recent revelations regarding Wal-Mart's "failure to collect California sales tax" on sales by CSN Stores (based in Boston) that are made through Wal-Mart's website.

Sure, there is some degree of comic irony in the fact that Wal-Mart is one of the leaders in the fight to force Amazon.com to collect sales tax on its online sales.  Furthermore, it doesn't help the public's perception that CSN Stores has posted on its website (in broad daylight, no less) that "one of the best things about buying through CSN Stores is that we do not have to charge sales tax . . ."

However, the thing that the media frenzy on this subject will not indicate is whether Wal-Mart is legally required to collect sales tax on these particular sales.  It all depends on the facts (and many times, the facts seem to be unimportant in the mainstream media).

Wal-Mart is a great company, and they collect sales tax when they are legally required to do so.  Amazon.com is also a great company, and they collect sales tax when they are legally required to do so.  There is nothing wrong with that.  Just because these companies dominate in their respective markets doesn't give the states carte blanche to force them to collect sales tax because it is easy for them to do so, or because the states think they are missing out on potential tax revenues.

Wal-Mart and Amazon.com could become strange bedfellows in an environment where states are attempting to cross legal boundaries just because they need budgetary relief from what the U.S. Constitution has limited them from doing.