Income & Franchise Taxes—Deductions -
Massachusetts—Appeals Court Allows Deduction for Utility Taxes Paid to Indiana -
The Massachusetts Appeals Court reversed a decision of the Appellate Tax Board and allowed Bay State Gas Company (“Bay State”) to deduct Indiana Utility Receipts Tax (“URT”) from its Massachusetts net income for corporate excise tax purposes.
Bay State is an energy company that operated in Massachusetts and, through two affiliates, in Indiana. Its affiliates were subject to and paid URT to Indiana. The URT is denominated as an “income tax” by Indiana statutes and imposes a tax on gross receipts received as consideration for the retail sale of utility services for consumption in Indiana.
Originally published in the Winter 2020 edition of CCH’s Journal of State Taxation (Vol. 39, Issue 1).
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