Tax Conflict of Laws

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Making A Federal Case Out Of State Taxes

The U.S. Supreme Court will have an opportunity to clarify the circumstances under which state taxes may be challenged in federal court. On July 1, 2014, the Supreme Court granted certiorari in Direct Marketing Association v....more

Splits Are Not the Best for Business: Uncertainty after Conflicting Decisions on the Scope of Obamacare Subsidies

The recent decisions by the Fourth Circuit and the D.C. Circuit address a controversy that could have far-reaching consequences for the Patient Protection and Affordable Care Act (the “ACA”). Under the ACA, states and the...more

Circuit Court Split on ACA Could Impact Employer Penalties

In conflicting opinions released on July 22nd, two federal circuits split on whether Affordable Care Act subsidies are available under a federally operated health insurance exchange. “Pay or play” penalties apply only if...more

Possible Impact on Alabama Taxpayers: Michigan Supreme Court Rules that IBM Entitled to Use Multistate Tax Compact Election

In International Business Machines Corp. v. Department of Treasury, the Michigan Supreme Court ruled that IBM was entitled to apportion its business income for purposes of the Michigan Business Tax (“MBT”) using the...more

Halbig v. Burwell: A Death Blow for the Affordable Care Act?

On July 22, 2014, a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit ruled in Halbig v. Burwell that the Affordable Care Act (ACA) authorizes the issuance of tax credits to assist...more

Native American Business Law Alert: Significant Tax and Applicable Law Ambiguity in Proposed Revisions for Indian Lands...

The Bureau of Indian Affairs (BIA) is proposing to revise the process for obtaining and administering rights-of-way (ROWs) on Indian lands. While the proposed regulations seek to make improvements and clarifications...more

US Supreme Court to Review Federal Jurisdiction over State Tax Cases

A recent Supreme Court action may impact taxpayers who have or are contemplating filing a lawsuit challenging a state tax law, or retailers analyzing compliance requirements under state Amazon laws. On July 1, 2014 the...more

Supreme Court Grants Certiorari To Two State Tax Cases

On July 1, 2014, the Supreme Court granted certiorari to two state tax cases, just one day after denying certiorari in the Mississippi Equifax case. The two cases, which will be heard during the Court’s October 2014 term,...more

Court of Appeals Rules 23-Day Notice Requirement for Third Party Summonses is Mandatory in Tenth Circuit

In Jewell v. U.S., Taxpayer Sam Jewell was the subject of an IRS investigation which resulted in third party summonses being issued to banks located in both the Eastern and Western Districts of Oklahoma. Mr. Jewell challenged...more

Second Illinois Appellate Court Clarifies When Fee Provisions In Other Statutes Trump The FOIA’s Fee Provisions

Readers of our FR Alerts may recall that in late 2012, the Fifth District of the Illinois Appellate Court clarified the narrow circumstances in which a public body may charge fees greater than those in the Freedom of...more

EU Court Of Justice Rejects UK Challenge To The EU Financial Transactions Tax

The progress of the European Financial Transaction Tax (the “FTT”) towards becoming law in eleven participating Member States of the European Union overcame another hurdle on 30 April 2014 with the Court of Justice of the...more

MTC State Transfer Pricing Program Looms on the Horizon

Transfer pricing is usually considered an international affair, but state governments, like there larger national brethren, have increasingly, and painfully, come to realize that inter-state transfer pricing has become a...more

Who Is a U.S. Person? Disparities Between U.S. Tax and Immigration Law

The question of who is a U.S. person has always been relevant for tax purposes because it determines who is subject to (a) U.S. income, gift and estate tax, (b) filing Foreign Bank Account Reports (FBARs), and (c) the ‘‘exit...more

Marijuana Taxation Update: State Sanctioned Marijuana Industry Must Keep the Federal Anti-Drug Trafficking Tax Code in Mind

As we have previously reported, despite the growing number of States that have authorized the use of marijuana in various forms, the federal government has continued to crack down on dispensaries. In addition to direct...more

Feds’ Argument in Favor of Premium Tax Credit Gains Momentum, Still Under Attack in Federal Courts

A second federal district court judge has ruled in favor of the government on one of the most serious challenges to the Patient Protection and Affordable Care Act of 2010 (ACA). The court dismissed a challenge to the...more

U.S. Supreme Court Holds Penalty Applies When Transaction Lacks Economic Substance

On December 3, 2013, the United States Supreme Court in U.S. v. Woods, 112 AFTR 2d 2013-6974, resolved a split in the circuits when it held that the § 6662(h) valuation misstatement penalty applies when deductions are denied...more

Illinois Click-Through Nexus Law Preempted by the Internet Tax Freedom Act

In a 6-1 decision, the Illinois Supreme Court affirmed an Illinois Circuit Court holding that Illinois Public Act 96-1544 (The Click-Through Nexus Act), requiring out-of-state retailers to collect and remit use tax, violates...more

Illinois Supreme Court Holds Internet Sales Tax Preempted by Federal Statute

On Friday morning, the Illinois Supreme Court handed down its opinion in one of its most high-profile pending cases. The Court held in Performance Marketing Association, Inc. v. Hamer that the federal Internet Tax Freedom Act...more

Illinois Supreme Court Holds Federal Law Preempts Click-Through Nexus Law

In a decision released this October 18th, the Illinois Supreme Court upheld the Circuit Court of Cook County’s decision invalidating the Illinois click-through nexus statute in Performance Marketing Association v. Hamer. The...more

Nevada’s New Medical Marijuana Law—Now What?

Despite the unsettled nature of federal enforcement of the federal criminal drug laws in the context of state medical marijuana laws, the Nevada Legislature enacted Senate Bill No. 374 during its recently completed 77th...more

Taxation on Indian Reservations: To Balance or Not to Balance, That Is the Question

Introduction - The ability of the states to impose a tax upon transactions occurring on an Indian reservation has evolved substantially in the past 50 years. After numerous court decisions, the Indian preemption...more

Tax Litigation Update: Second Circuit Decision Limits Deductibility of Life Insurance Dividends

A decision by the United StatesCourt of Appeals for the Second Circuit earlier this month strictly interpreted deductibility I.R.C. § 808(c) as it relates to the deductibility of policyholder dividends paid by life insurance...more

Equityholder's Strategy for Shifting Tax Burdens to Creditors Upheld by Third Circuit

In re Majestic Star Casino, LLC, F.3d 736 (3rd Cir. 2013), the U.S. Court of Appeals for the Third Circuit broke from other courts by holding that S corporation status (or "qualified subchapter S subsidiary" or "QSub" status)...more

The trust decanting statutes: Nuisances that should be repealed.

Inherent in a trustee’s discretionary authority to make a distribution of trust property outright and free of trust to a permissible beneficiary of the trust may well be the authority to distribute the property instead to...more

California Supreme Court Allows Class Actions for Local Tax Refunds - Class Actions Allowed Despite Local Ordinances Banning Them

The California Supreme Court recently ruled that local tax refund claims may be pursued as class actions, even where a city has an existing ordinance prohibiting such claims. The ruling is broad enough to expose local...more

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