Tax News

ARE YOU READY?

It’s no secret that states are running the most significant budget shortfalls in the Post-WWII era. As a remedy, they can either raise tax rates, increase the base, add more taxes, or heighten enforcement. Clearly the most pragmatic thing, and least politically problematic thing to do is heighten enforcement. And the ...

The Multistate Tax Commission (MTC) has just announced a special tax amnesty program for unregistered online marketplace sellers that have established nexus and historical exposure as a result of storing inventory in third-party fulfillment centers that facilitate retail sales into the state (e.g., Amazon FBA program). Under the program, eligible taxpayers may obtain amnesty ...

The New York Department of Taxation and Finance (Department) recently issued an Advisory Opinion providing their interpretation of yet another Taxpayer's provision of Software As a Service (SAaS). In TSB-A-15(36)S, Taxpayer sought an Advisory Opinion from the Office of Counsel for the Department, as to the application of New York sales tax ...

Ever since, and even before, the U.S. Supreme Court’s landmark 1992 decision in Quill Corp. v. North Dakota, in which it affirmed the Commerce Clause ‘physical presence’ standard for sales tax nexus, Congress has continually grappled with the increasing sales tax revenue shortfalls and perceived unfair advantage that online and mail-order retailers have ...

Net neutrality is the principle that Internet service providers and governments should treat all data on the Internet equally, not discriminating or charging differentially by user, content, site, platform, application, type of attached equipment, or mode of communication. There has been extensive debate about whether "Net neutrality" should be required by law. Proponents of "Net ...

As states continue to wrestle to define tax policy for the services that comprise the expanding world of cloud computing, South Carolina has again asserted its expansive approach for taxing anything that resembles communications services, including charges for Software As a Service (SAaS) or Platform As a Service (PAaS). [Private Letter Ruling #14-4, South Carolina ...

Telematics services, or the "Internet of Things", require Internet access and Internet related services in order to be provided. The Internet Tax Freedom Act dictates that in most instances, "Internet access" shall be exempt from sales tax. It remains to be seen how states will define telematics and seek to apply existing or new sales ...

In two recent rulings, Virginia Ruling of the Commissioner PD 14-130 and 14-131 , the Virginia Commissioner ruled that Internet activation and Internet reactivation fees are not exempt under the Internet Tax Freedom Act. Rather they are subject to Virginia's communications sales tax. In Bloomberg BNA's 9/5 /14 Sales Tax Slice blog posting ...

On July 1, 2014, the United States Supreme Court granted the petition for writ of certiorari filed by Petitioner Direct Marketing Association (DMA) in a case involving Colorado’s controversial notification law. [Direct Marketing Association v. Brohl, U.S. Supreme Court, Dkt. 13-1032, petition for certiorari granted July 1, 2014] This case stems from Colorado ...

Sometimes my job can be quite difficult. I don’t enjoy telling the client that they have nexus, and/or that they have sales tax exposure in a state that they should address as soon as possible. Trust me, I would much rather share the news with a client that everything they are doing is ...

On March 24, 2014, Maryland’s highest court, the Court of Appeals, upheld a finding of nexus against two Delaware affiliates of W.L. Gore & Associates, Ltd. (Gore), on the premise that the affiliates lacked any economic substance [ Gore Enterprise Holdings, Inc. v. Comptroller of the Treasury, Md. Ct. App., No 36 (March 24, 2014 ...

On February 18, 2014, a Colorado judge enjoined the Colorado Department of Revenue’s enforcement of the remote seller sales and use tax notification requirements enacted by the Colorado legislature in 2010. [Direct Marketing Association v. Dep't of Revenue et al.; District Court, City and County of Denver, Case No. 13CV34855 (2/18/14 ...

A recent Massachusetts letter ruling refines its definition of cloud computing, a rapidly evolving computer medium that includes, among other things, the Internet provision of Software As a Service (SAaS), Infrastructure As a Service (IAaS), and Platforms As a Service (PAaS). SAaS - the most common form of cloud computing – involves the provision of access to ...

IS YOUR STATE NEXT?

I was recently approached regarding a nexus question by a company that was physically located in one state. The company was considering entering into a contractual arrangement with a third-party marketing company located in numerous states. The marketing company proposed to market and promote the company through links on the marketing ...

YOU DON’T KNOW THAT YOU DON’T KNOW

When I am referred in to a new client, the client and I go through a set of diagnostic questions designed to help us evaluate the company’s taxable presence, current sales tax compliance, and historical sales tax exposure. Often times, as I begin asking the ...

CLEANING UP THE PAST

The City of Los Angeles, Connecticut, Louisiana and Vermont currently have amnesty programs open to past taxpayer sales and/or use tax liabilities. These programs are typically only open for 8 to 10 weeks (LA, Louisiana and Connecticut’s essentially end in November 2013, and Vermont’s ends by May 1 ...

REPEALED!!

In case you missed the recently effective sales tax in Massachusetts on certain computer services, its over. Effective September 30, 2013, recent legislation, St. 2013, c. 95, retroactively repeals recently effected imposition of the Massachusetts sales and use tax to certain services relating to computer system design and to modification, integration, enhancement, installation, or ...