Incidental property doesn’t make transaction taxable in Michigan

With more and more companies providing mixtures of services and tangible personal property in recent years, states have responded with taking aggressive positions on taxes.  Many states have attempted to find an entire transaction taxable even though the sale of tangible personal property is just a small part of a transaction that otherwise involves providing non-taxable services.  In Catalina Marketing Sales Corp. v. Dept. of Treasury, the Michigan Supreme Court threw out the state’s “real object” test and replaced it after finding the Treasury Dept. was going too far in its use.  The case has been sent back to the Tax Tribunal to apply the new test, so the final result remains in the balance on how the new test will be applied.

* * * * *

This story is from the CCH’s monthly Focus on Tax newsletter, which provides advise and guidance on federal and state tax issues for tax and accounting professionals.

Read this article from CCH’s Journal of Taxation of Financial Products.


Wolters Kluwer Tax and Accounting

Wolters Kluwer Tax and Accounting is a leading provider of software solutions and local expertise that helps tax, accounting, and audit professionals research and navigate complex regulations, comply with legislation, manage their businesses and advise clients with speed, accuracy and efficiency. Wolters Kluwer Tax and Accounting is part of Wolters Kluwer N.V. (AEX: WKL), a global leader in information services and solutions for professionals in the health, tax and accounting, risk and compliance, finance and legal sectors. We help our customers make critical decisions every day by providing expert solutions that combine deep domain knowledge with specialized technology and services. Wolters Kluwer reported 2016 annual revenues of €4.3 billion. The company, headquartered in Alphen aan den Rijn, the Netherlands, serves customers in over 180 countries, maintains operations in over 40 countries and employs 19,000 people worldwide. Wolters Kluwer shares are listed on Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices. Wolters Kluwer has a sponsored Level 1 American Depositary Receipt program. The ADRs are traded on the over-the-counter market in the U.S. (WTKWY).

All stories by: Wolters Kluwer Tax and Accounting