|
QUESTIONS?
NEED MORE INFORMATION?
Contact one
of the Tronconi
Segarra &
Associates’ State
& Local
Tax Services Team
Leaders:
David E. Werth
J.D., CPA, Partner
Andrew J. Toth
CPA, Principal
Thomas E. Mazurek, Jr.
CPA, Senior Manager
State and Local
Tax Services
Audit Representation
Reverse Audits
Nexus Review
Voluntary Disclosure
Research & Analysis
Managed Compliance Agreements
Sales Tax System Development
Outsourcing
Merger & Acquisition Planning
Compliance Management
|
|
Tax Tips – March 2011
State Amnesty Programs At-a-Glance
| State |
Amnesty Period |
Benefits |
| City of Cincinnati |
Feb. 1 to March 31, 2011 1 |
Interest & Penalties waived |
| Michigan |
May 15 to June 30, 2011 |
Penalties waived |
| Washington |
Feb. 1 to April 30, 2011 2 |
Interest & Penalties waived |
(1) Limited to City of Cincinnati income tax.
(2) Taxpayers have until April 18, 2011 to submit their amnesty application and file any outstanding returns and amended returns for which amnesty is requested.
Amnesty
MO
The Missouri House of Representatives has approved a bill (H.B. 116) that would establish an amnesty program for taxpayers with unpaid taxes due before December 31, 2010, that are reported and paid in full from August 1, 2011 through October 31, 2011. Taxpayers with known or unknown liabilities who participate in the amnesty program will be eligible for a full waiver of interest and applicable penalties related to the tax due, as long as they comply with state tax laws for the next eight years. The bill, which has been sent to the Missouri Senate, needs to be approved there, and then signed into law by the governor before the program can start. Supporters of the amnesty measure are estimating that this program could generate approximately $74 million of tax revenue for the state.
Affiliate Nexus
SD
The governor has signed legislation expanding nexus provisions for sales & use tax purposes. The new law provides that a retailer is considered to be “engaged in the business of selling tangible personal property, services, and products transferred electronically for use in South Dakota” if:
the retailer holds a substantial interest in, or is owned by, a South Dakota retailer, and (2) the retailer sells the same or a substantially similar line of products under the same or similar business name as the related South Dakota retailer, or the in-state facility or in-state employee of the related retailer is used to advertise, promote, or facilitate sales by the retailer to a consumer; or
the retailer holds a substantial ownership interest in or is owned by a business that maintains a distribution house, sales house, warehouse, or similar place of business in South Dakota that delivers property sold by the retailer to consumers.
Additionally, retailers making sales of tangible personal property to purchasers in South Dakota by mail, telephone, the Internet or other media that has a contractual relationship with an entity to provide and perform installation, maintenance or repair services for the retailer’s purchasers within this state is included within the definition of "retailer." This law, similar to the affiliate nexus legislation passed in Oklahoma last year, is another sign of states stepping up their efforts to require remote sellers to collect tax.
Click-Through Nexus
IL
The governor has signed “click-through” nexus legislation into law that will be effective July 1, 2011. The new law requires certain out-of-state sellers who are considered retailers or servicemen maintaining a place of business in Illinois to collect use or service use tax on items or services sold for use in the state. An out-of-state seller is considered a "retailer maintaining a place of business" in Illinois for use tax purposes if:
the retailer has a contract with a person located in Illinois under which the person, for a commission or other consideration based upon the sale of tangible personal property by the retailer, directly or indirectly refers potential customers to the retailer by a link on the person's Internet website; or the retailer has a contract with a person located in Illinois under which the retailer sells the same or substantially similar line of products as the person located in Illinois and does so using an identical or substantially similar name, trade name, or trademark as the person located in Illinois, and the retailer provides a commission or other consideration to the person located in Illinois based upon the sale of tangible personal property by the retailer.
Under each type of contract described above, a retailer is considered an Illinois retailer only if the cumulative gross receipts from sales of tangible personal property under the contract exceed $10,000 during the preceding four quarterly periods ending on the last day of March, June, September, and December. The above treatment also applies to out-of-state servicemen who have contracts with persons in Illinois. Look for additional guidance from the Illinois Department of Revenue as July 1st approaches.
Multiple States
A number of states have introduced “click-through” nexus or affiliate nexus legislation since the beginning of 2011 including: Arizona; Arkansas; California; Connecticut; Hawaii; Massachusetts; Minnesota; Mississippi; New Mexico; Tennessee; Texas; and Vermont. While two of these bills have already died in committee (Mississippi and New Mexico), bills are rapidly working their way through legislatures in Arkansas, Hawaii and Vermont. Check back for further developments on nexus legislation in the coming months.
Industrial development agency exemption denied
NY
A company acting as an agent of the County of Monroe Industrial Development Agency (COMIDA) was properly denied a New York sales tax exemption for the purchase of a boom truck that was primarily used to transport equipment in Monroe County. The taxpayer was not entitled to the sales tax exemption because designating the boom truck as a "facility" failed to establish COMIDA jurisdiction. The boom truck simply was not a facility. It did not meet the definition of a facility within the New York Industrial Development Agency (IDA) Act because it was neither land nor a building located within Monroe County. The boom truck also did not meet the common definition of facility because it was neither designed nor installed to afford a specific convenience or service. As such, designating the boom truck as a facility was improper. Absent the designation of a proper facility within Monroe County, the taxpayer could not prove that the grant of the exemption for the purchase of the boom truck was within the legal jurisdiction of COMIDA. Accordingly, the taxpayer failed to carry its burden of showing clear entitlement to the exemption.
The Tax Appeals Tribunal did not need to address whether the purchase of the boom truck constituted a "project" because the taxpayer failed to show that the project was located in Monroe County (i.e., within the jurisdiction of the COMIDA).
|
|
Thank you for your interest in the Tronconi Segarra & Associates LLP State & Local Tax electronic newsletter. This message was sent from Barbara Harmel at Tronconi Segarra & Associates LLP, 6390 Main Street, Suite 200, Williamsville, New York, 14221.
To unsubscribe from future State & Local Tax newsletters sent by Tronconi Segarra & Associates, please reply to this email and type "Unsubscribe" in the subject line.
Any tax advice included in this written or electronic communication was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or any other governmental taxing authority or agency.
The information contained in this message may be privileged and confidential and protected from disclosure. If you are not the intended recipient, or an employee or agent responsible for delivering this message to the intended recipient, you are hereby notified that any dissemination of, distribution of, copying of or taking action in reliance on this communication is strictly prohibited. If you have received this communication in error, please notify the sender immediately by replying to the message and deleting it from your computer
|
