State Tax Headlines

1789

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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California ~ Corporate Income Tax: Enterprise Zone Sales and Use Tax Credit Not Allowed for Current Expense Assets

The California corporation franchise and income tax credit for sales and use tax paid or incurred in connection with the purchase of qualified property placed in service in an enterprise zone was not available for a taxpayer’s purchase of current expense assets. Construing Rev. & Tax. Code Sec. 23612.2 narrowly against the taxpayer, the court held the credit was available only for the purchase of capital assets.

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Utah ~ Sales and Use Tax: Affiliate Nexus Bill Passes Legislature

The Utah Legislature has passed an affiliate nexus bill that would require certain out-of-state sellers to collect and remit Utah sales and use tax. The bill contains provisions defining the ownership or contractual relationships that constitute affiliation for nexus purposes. Under certain conditions, an affiliated seller would be (1) considered engaged in the sale of tangible personal property, a service, or an electronically transferred product in Utah and (2) required to pay or collect and remit taxes. If enacted, the affiliate nexus provisions would be effective July 1, 2012.

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Minnesota ~ Multiple Taxes: Assignment of Historic Structure Rehabilitation Credit Certificates Discussed

The Minnesota Department of Revenue has issued a Revenue Notice regarding the assignment of historic structure rehabilitation credits, which are available against corporate, personal, and insurance premium taxes. According to the department, only an original recipient of the tax credit certificate who is listed on the certificate can assign the certificate to another taxpayer and the credit certificate can only be assigned once. The credit may flow through an entity (such as a partnership or other flow-through entity), so the partner or owner of a partnership or LLC would not need to be listed on the application or credit certificate to receive the credit.

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