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Note from the Editors
Welcome to the August 2024 edition of The BR State + Local Tax Spotlight. We know the importance of remaining up to date on State + Local Tax developments, which appear often and across numerous jurisdictions. Staying informed on significant legislative developments and judicial decisions helps tax departments function more efficiently, along with improving strategy as well as planning. That is where The BR State + Local Tax Spotlight can help. In each edition, we will highlight important State + Local Tax developments that could impact your business.
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Update from previous editions:
In the February 2024 edition of The BR State + Local Tax Spotlight, Craig B. Fields authored an article titled “Pennsylvania Commonwealth Court Affirms That Pittsburgh’s Tax on Only Nonresident Athletes Violates State’s Uniformity Clause.” Since the publication of his article, the City of Pittsburgh petitioned to appeal the order of the Commonwealth Court in National Hockey League Players’ Ass’n v. City of Pittsburgh to the Supreme Court of Pennsylvania. On July 22, 2024, the Court granted the City’s petition, but has limited the issue it will consider to “[w]hether the Commonwealth Court’s majority opinion departed from [the] Court’s precedent in Minich v. Sharon, 77 A.2d 347 (Pa. 1951), and incorrectly interpreted the Pennsylvania Uniformity Clause to require exact uniformity in the ultimate destination of the tax revenue among residents and nonresidents, rather than ‘rough equality’ in the overall tax burden.”
Joshua M. Sivin and Melanie L. Lee
ARTICLES
Despite Being an Officer and Previously Writing Checks for a Business, New York Concludes Individual Is Not a Responsible Person
By Craig B. Fields
Although a person having an officer title, being listed on tax documents as a “responsible person,” and having check signing authority will usually be found to be a “responsible person” for New York sales and use tax purposes, an individual was able to overcome this with the power of uncontroverted testimony. Read More >>
New York City ALJ Rules That Deductions Allowable for Federal Income Tax Purposes Are Also Allowable under the UBT
By Joshua M. Sivin
In a recent case, a New York City Administrative Law Judge determined that the City’s unincorporated business tax did not impose a second, discrete requirement that a deduction need be directly connected with business conduct without reference to the federal income tax deduction standard. Read More >>
Maryland’s Digital Advertising Tax Survives First Amendment Challenge (For Now)
By Eugene J. Gibilaro
On July 3, 2024, the U.S. District Court for the District of Maryland dismissed a First Amendment challenge to Maryland’s Digital Advertising Gross Revenues Tax (the “Tax”) holding that while a provision in the Tax scheme that prohibits taxpayers from directly passing on the Tax to their customers “by means of a separate fee, surcharge, or line-item” was a restriction on the free speech rights of taxpayers, plaintiffs here had not met their burden to show that the provision was unconstitutional on its face. Read More >>
Earning the Name Taxachusetts
By Nicole L. Johnson
While Massachusetts has long been known to overreach in search of tax dollars, the recent decision in Sakowski v. Commissioner of Revenue solidifies the State’s nickname as Taxachusetts. Read More >>
Minnesota Supreme Court Holds That Market Research Performed by Sales Representatives Exceeds P.L. 86-272 Protection
By Irwin M. Slomka
The Minnesota Supreme Court has held that market research conducted by an out-of-state company’s sales representatives when visiting in Minnesota exceeded “solicitation of orders” and therefore, the company was not protected from Minnesota state income tax and franchise tax under Public Law 86-272. Read More >>
WHAT’S SHAKING: BLANK ROME STATE + LOCAL TAX ROUNDUP
Blank Rome’s nationally prominent State + Local Tax attorneys are thought leaders in the community as frequent guest speakers at various local and national conferences throughout the year. Our State + Local Tax attorneys believe it is necessary to educate and inform their clients and contacts about topics that will impact their businesses. We invite you to attend, listen, and learn as our State + Local Tax attorneys interpret and discuss key legal issues companies are facing and how you can put together a plan of action to mitigate risk and advance your business in accordance with state and local tax laws. Read More >>
© 2024 Blank Rome LLP. All rights reserved. Please contact Blank Rome for permission to reprint. Notice: The purpose of this update is to identify select developments that may be of interest to readers. The information contained herein is abridged and summarized from various sources, the accuracy and completeness of which cannot be assured. This update should not be construed as legal advice or opinion, and is not a substitute for the advice of counsel.
