State Tax Headlines

1789

Indiana ~ Sales and Use Tax: Online Service Providers’ Promotional Materials Were Taxable

An out-of-state online service provider was liable for Indiana use tax on promotional materials sent to Indiana residents from out-of-state producers because the service provider purchased the production and mailing of the promotional materials in retail transactions. Relying on statutory law, the Indiana Supreme Court reasoned that a sale is a taxable retail sale whether or not the property transferred was in the same form as it was when acquired.

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Connecticut ~ Sales and Use Tax: School Teachers Were Representatives of Corporation For Purposes of Nexus

School teachers were in-state representatives of a bookseller corporation for purposes of establishing nexus to justify the imposition of Connecticut sales and use taxes. Connecticut law provides that “engaged in business in the state” is defined to mean and include but not be limited to a number of activities that subject an out-of-state retailer to sales and use taxation, one of which is having any representative, agent, salesman, canvasser, or solicitor who operates in Connecticut to sell, deliver or take orders.

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California ~ Personal Income, Sales and Use Taxes: Agreement Reached Between Governor, Legislative Leaders, and Unions on Fall Tax Initiative

California Gov. Jerry Brown, legislative leaders, and the Restoring California Coalition (comprised of the California Federation of Teachers, California Calls, the Courage Campaign and ACCE) announced that they have joined together to place a single revenue initiative on the November 2012 ballot that, if passed, would provide a temporary increase in the personal income tax rate for taxpayers with incomes exceeding $500,000 as well as a temporary increase in the sales and use tax rate. If passed, the initiative would increase the sales tax rate by 0.25 cent, which would sunset after 2016. The governor had previously proposed a 0.5-cent increase. Personal income tax rates would increase by:

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New Jersey ~ Sales and Use Tax: Assembly Passes Bill Enumerating Certain Persons as Sellers, Including Affiliate Nexus Provisions

The New Jersey Assembly has passed a bill that would enumerate certain persons who are deemed to be sellers responsible for the collection of sales and use tax and to clarify the tax collection responsibilities of certain other persons and agents. Specifically, the bill would revise the current definition of a “seller” to specify that each of the following persons would be deemed to be a seller and would be required to register as a seller and collect and remit the tax determined to be due:

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Texas ~ Multiple Taxes: Fresh Start Amnesty Announced

The Texas Comptroller of Public Accounts has issued a notice to taxpayers announcing the Fresh Start tax amnesty, which applies to businesses that owe sales tax, franchise tax, or other state and local taxes and fees administered by the comptroller. During the amnesty period of June 12 through August 17, 2012, taxpayers can avoid penalties and interest by filing or amending reports and paying any overdue taxes. The amnesty does not cover amounts originally due after April 1, 2012, underpaid tax returns (i.e., previously reported tax that was not paid), or taxes owed for filing periods that businesses have in audit.

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South Carolina ~ Corporate Income Tax: Department Had Burden of Proving Alternative Apportionment Formula Was Appropriate

The South Carolina Court of Appeals has determined that a party seeking to override the legislatively determined apportionment method must bear the burden of proving that the method is not appropriate and that an alternative method more accurately reflects the taxpayer’s business activity within South Carolina for corporate income tax purposes.

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Minnesota ~ Sales and Use Tax: Tax Court Lacked Jurisdiction to Hear Contractor’s Appeal

The Minnesota Tax Court lacked jurisdiction to hear an appeal of a sales tax assessment by a home repair and remodeling contractor because there was no appealable order. In addition, the contractor’s claim was barred by the doctrine of res judicata because the contractor had already appealed the assessment and the case was fully litigated. Furthermore, the contractor was not entitled to a refund because he had not paid sales tax to the state.

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Oregon ~ Corporate Income Tax: Case Addressing Application of Business Energy Tax Credit Appealed to State Supreme Court

The Department of Revenue (DOR) has advised that it has appealed to the Oregon Supreme Court in the case of Con-Way, Inc. v. Department of Revenue, which held that a corporation was allowed to apply its business energy tax credit (BETC) against its Oregon corporation excise (income) minimum tax. According to the DOR, the previously reported Oregon Tax Court decision (TAXDAY, 2012/01/04, S.16) suggests that all corporate tax credits, unless specifically prohibited by statute, may be applied against the corporate minimum tax. The DOR stated that the Tax Court’s decision contradicts the DOR’s long-standing position that credits cannot reduce corporation excise tax below the minimum tax.

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