Stephen P. Kranz is a partner, Diann L. Smith is counsel, and Charles C. Capouet is an associate with McDermott Will & Emery. Kranz and Smith were both previous general counsels for the Council On State Taxation. Kranz is former president of the Business Advisory Council of the Streamlined Sales Tax Governing Board.
This article is intended as a lighthearted look at the world of state and local tax by lawyers in MWE's state and local tax group. The authors predict coming trends and how the state tax profession will change in light of last year's major events. They include developments from 2013 that some practitioners hope have come to an end. If you have a different view of the landscape, the authors welcome comments at firstname.lastname@example.org.
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With 2013 in the rearview mirror, we think it's fair to say that it was a year when what was in and what was out for state and local taxation often were the same, or at least the state and local tax world did and undid itself at what seemed like an unprecedented rate.
We saw the New York click-through law upheld and the Illinois click-through law struck down. The Multistate Tax Compact was repealed in numerous states and partially reenacted. Mark Udinski left his role managing Delaware's contingent fee audits and came back as a contingent fee auditor. Massachusetts adopted and then repealed a tax on computer software services. Colorado's reporting regime was struck down and un-struck by different courts of competent jurisdiction. Cloud and tech taxes were adopted and repealed. Gillette litigation grew a beard and shaved it. And the Multistate Tax Commission rejected uniform apportionment while its own hearing officer told the commission that it should be required; even our SALT organizations can't seem to decide a direction.
With this comic-bookish, Harvey Dent/Two-Face environment as our guide, we've put together our list of what's in and what's out for SALT in 2014. As before, the article is intended to be a mostly lighthearted overview of recent developments and predictions. Our potshots and plaudits are meant in earnest or in jest; you decide.
One thing is certain for 2014: Everyone hopes the year will help iron out the herky-jerky back and forth of 2013. How can any state tax professional predict whether the trends that started -- and possibly lost ground -- in 2013 will pick up speed, and which direction they will go? Would you bet money on the outcome of Colorado's reporting regime challenge? Would you tell a friend at a Council On State Taxation cocktail reception that Udinski's departure signaled great things for Delaware? Would you?
The collective we stopped betting on the outcome of predictions like these years ago and now enjoy just tossing out the possibilities and waiting to hear the voices of readers responding in agreement or disagreement.
We appreciate the many e-mails sent by readers last year and hope that this year's list generates as much feedback. If you agree or disagree, let us know. And put a reminder on your calendar for next January to send us your nominations for the list.
What's In? What's Out?
Colorado use tax snitching Self-reporting use tax
Open season on statutory Following statutory apportionment
Richard Pomp's Wishy-washy MTC "uniform"
Look-through market sourcing Cost of performance for
receipts from intangibles
Burden of proof Presumption of correctness
Exempting the cloud Taxing the cloud
Shirley Sicilian, national Shirley Sicilian, MTC
director of state and general counsel
local tax controversy,
Challenging patents on Section 482 transfer
section 482 audit pricing audits
Required disclosure of Taxpayer confidentiality
Equifax v. Mississippi Due process in Mississippi
Department of Revenue
at the U.S. Supreme
State tax reform Federal tax reform
Gimmicks and other junk State tax reform
ways of collecting
New York click-through law Illinois click-through law
Uniform Unclaimed Property Uniform Unclaimed Property
Act of 2014 (2015, Act of 1995
2016, or. . .)
A wise man learns from Massachusetts's "tech tax"
others' mistakes. An
average man learns from
his own. And then there
Mark Udinski, employee of Mark Udinski, employer of
auditing firm Kelmar auditing firm Kelmar
States adopting SSUTA to States adopting the
prepare for the Streamlined Sales and
Marketplace Fairness Act Use Tax Agreement to
simplify their sales tax
District of Columbia SkyNet
Office of Tax and
Revenue computer systemc
Qui Tam False Claims Act DOR audits for
suits for undercollection undercollection of tax
Class action suits for Refund claims for
overcollection of tax overpaid tax
Joining the MTCC Multistate Tax Compact
(Multistate Tax Cult membership
Members of Congress Nine justices
Tax Foundation TBD
North Dakota Tax North Dakota Tax
Commissioner Ryan Commissioner Cory Fong
Reporting news Making news
Tax expenditure reporting Credits and incentives
Composting Bag taxes
Marijuana edibles tax Snack taxes
Drone taxes Gas taxes
Seeking injunctive relief Rolling over for unclaimed
Marketplace Fairness Act: Marketplace Fairness Act:
Episode VII Electric Boogaloo
Maryland State Comptroller Local government dominion
of the Treasury v. Wynne and control
Deputy Secretary John Doyle, West Virginia Del. John Doyle
West Virginia Department
David Brunori, the David Brunori, the
unrequited libertine irritable libertarian
Richard Pomp, Professor Richard Pomp,
Person of the Year reporter
FOOTNOTES TO TABLE
a Kranz, Smith, and Capouet, "Open Season on State Statutory
Apportionment," State Tax Notes, Aug. 12, 2013, p. 429.
b David Brunori, "Tax Reform Advice for 2014: Think About Spending,"
State Tax Notes, Jan. 6, 2014, p. 33.
c See D.C. Office of Tax and Revenue v. Shuman, No. 12-AA-466
END OF FOOTNOTES TO TABLE
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