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State & Local Tax news

February 2018

In This Issue:

 

Welcome to the February 2018 issue of the Aprio State & Local Tax (SALT) Newsletter.

With dozens of different taxes imposed by the 50 states (and thousands of local jurisdictions), we recognize how challenging it is to keep up with current issues and developments. This newsletter is designed to provide insights on developments in state and local taxes including new legislation, regulations, rulings and cases addressing issues such as corporate and personal income taxes, sales and use taxes, nexus, franchise/net worth taxes, etc.

This issue of the newsletter contains articles concerning (i) how states may or may not conform to federal tax reform, (ii) a potential refund opportunity in Michigan cities with a local income tax based on a Court of Appeals decision regarding revenue sourcing, (iii) California guidance explaining the “throwback” rule and the “subject to tax” test, (iv) a new small business tax credit to the New York City Commercial Rent Tax, and (v) a Texas letter ruling addressing Franchise Tax revenue sourcing for certain wireless data and voice services.

In case you missed prior issues of this newsletter, please click here.

If you have any comments, questions or suggestions regarding current or future topics, or if you would like to learn more about Aprio's SALT Practice, please email us at jeff.glickman@aprio.com. Thank you.

Jeff Glickman
Jeff Glickman, J.D., LL.M.
Partner-in-Charge, State & Local Tax Practice
 
State Legislatures turn to conform to federal tax reform

Webinar: Multi-State Issues in Tax Reform

By Jeff Glickman, SALT partner

Join Aprio’s Jeff Glickman for a webinar on March 26 from 1 - 2:30 p.m. to gain a better understanding of the multistate tax considerations of federal tax reform. Use discount code: Y1519491 to receive 50% off the registration price.

 
State Legislature to conform to Federal tax reform

It's Our Turn: How will State Legislatures Conform (or Not) to Federal Tax Reform?

By Jeff Glickman, SALT partner

Even though most of the reforms under the Tax Cuts and Jobs Act are effective for tax years beginning on or after Jan. 1, 2018, failure of states to update their IRC conformity can impact the 2017 tax year.

 
Refund Opportunity

Michigan Court Ruling Reveals Refund Opportunity for Services Providers Paying City Income Tax

By Jeff Weinkle, SALT manager

Taxpayers that file city income taxes in Michigan may have refund opportunities if they have been sourcing revenues based on where services were performed.

California Issues Guidance on Throwback Rule for Sales Factor Apportionment

By Tina Chunn, SALT senior manager

The most significant issue when applying the throwback rule is understanding when a taxpayer is “not taxable” in the other (i.e., destination) state.

NYC skyline

New York City Enacts Small Business Credit for Commercial Rent Tax

By Alissa Graffius, SALT senior associate

Credit provides Commercial Rent Tax relief to small businesses and is effective beginning July 1, 2018.

 
Texas Ruling on Voice and Data Services

Texas Rules That Reseller of Voice and Data Services Is Not Selling an Intangible Asset for Apportionment Purposes

By Jess Johannesen, SALT manager

Ruling highlights the importance of properly characterizing revenue streams for apportionment purposes, since different revenue streams get sourced differently.

 

About Aprio's State and Local Tax Practice

Aprio's State and Local Tax (SALT) practice advises clients on the state and local tax implications of their business operations, allowing clients to strategically minimize their liabilities and risks. Our team has over 50 years of combined SALT experience working in industry, state departments of revenue, public accounting and private law practice. We specialize in all areas of SALT, including matters related to state tax nexus, corporate and personal income taxes, sales/use tax, franchise/net worth taxes, credits and incentives, and mergers and acquisitions. In addition, we represent clients in administrative matters before state revenue departments around the country, including audit defense and settlement negotiations, pursuing voluntary disclosure agreements and obtaining letter rulings.