Archive for June 2018
States can now force retailers without physical presence to collect sales tax, Supreme Court says
On June 21, 2018, the United States Supreme Court issued its opinion in South Dakota v. Wayfair, Inc.,[1] in which the Court, by a 5-4 vote, overruled over 50 years of precedent established by its rulings in Quill[2] and Bellas Hess,[3] and held that the physical presence nexus rule is “unsound and incorrect.”[4] This case…
Read MoreWashington Explains That Enhanced Delivery Services Create Sales and Use Tax Nexus
Despite the Supreme Court’s ruling that physical presence is no longer a requirement for sales tax nexus, it can still create nexus for a taxpayer if the activities performed in the state on its behalf help to establish or maintain a market in the state. By Tina M. Chunn, SALT senior manager This newsletter contains an…
Read MoreIdaho Determines that Flight School’s Aircraft Lease is Subject to Sales Tax
This Idaho ruling demonstrates that wet leases and dry leases are treated differently for sales tax purposes, and that a taxpayer may not rely on a resale exemption when engaging in wet leases. By Jess Johannesen, SALT Manager For sales and use tax purposes, the rental or lease of tangible property is generally taxable. If the…
Read MoreArkansas Addresses the Sales Tax Treatment of Bundled Computer Services
Bundling taxable and non-taxable goods/services can give rise to unfavorable sales tax consequences that can catch a seller by surprise and create unexpected tax liabilities. When analyzing the sales tax consequences of a transaction, the formalities of the arrangement (e.g., what the contract states or doesn’t state, how the invoice is presented, etc.) may often…
Read MoreNew Jersey Denies Subsidiary’s Interest Deduction on Debt Push-Down
Many types of intercompany transactions are subject to adjustment for state income tax purposes, and taxpayers that don’t properly structure those transactions can find themselves losing tax deductions. For state income tax purposes, almost all states that utilize separate company reporting have an adjustment to federal taxable income for certain types of payments, particularly interest…
Read MoreMichael Lange Speaks at GMAW 2018
Using Big Data Can Give Your Law Firm a Big, Predictive Advantage
At Georgia State University, law and business students are crunching thousands of data points from legal cases to create models to predict how disputes will go. Harvard-educated lawyer Charlotte Alexander, director of the Legal Analytics Lab, guides the team gathering all complaints, dockets and summary judgments in employment law cases since 2010 in the Northern…
Read MoreCorporations Must Pay Transition Tax to Bring Home Tax-Free Future Foreign Earnings
U.S.corporations with operations overseas might have been thrilled with tax reform that lets them bring home future foreign earnings free of federal tax. But before corporations can enjoy that benefit, they have a potential mountain of paperwork ahead of them. Most will find the information needed to calculate a one-time transition tax overwhelming, since it’s…
Read MoreBallgames, Dinners and Tax Reform: The New Meals and Entertainment Deductions
Say goodbye to tax deductions for business entertainment expenses like baseball tickets and golf outings. It used to be OK to lump together things like games and dinners as “meals and entertainment” expenses because all those things were generally 50% deductible. But recent federal tax reform has changed that, though standalone business meals may remain…
Read MoreCryptocurrency and Taxes: The Impact of Mining, Spending and Trading
When it comes to the challenges of cryptocurrency and taxes, ambiguity reigns. But companies should still plan ahead to avoid future problems.
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