02 June 2017 State and Local Tax Weekly for May 19 Ernst & Young's State and Local Tax Weekly newsletter for May 19 is now available. Prepared by Ernst & Young's State and Local Taxation group, this weekly update summarizes important news, cases, and other developments in U.S. state and local taxation. New York issues draft amended regulations addressing computation of prior net operating loss conversion subtraction The New York State (NYS) Department of Taxation and Finance (Department) recently released draft regulations under Article 9-A, the corporate franchise tax law (N.Y. Comp. Codes and Regs. tit. 20, Sections 3-9) covering the computation of the prior net operating loss conversion (PNOLC) subtraction. In 2014 and 2015, the New York legislature significantly amended Article 9-A of its general corporations tax law, which, in part, substantially changed the manner in which net operating losses (NOLs) were determined and carried over (moving from a “pre-apportioned” NOL to a “post-apportioned” NOL) and required the pre- tax reform NOLs (i.e., those generated in tax years beginning before Jan. 1, 2015) be converted to a PNOLC subtraction that could be used to offset a taxpayer's future business income. The draft regulations provide information on how to compute the unabsorbed net operating loss (UNOL), the PNOLC subtraction pool and the PNOLC subtraction, and how certain corporate acquisitions and liquidations affect the PNOLC subtraction. In addition, the draft regulations provide various examples for computing the UNOL and PNOLC subtraction. The draft regulations do not address the treatment of NOLs generated in a tax year beginning on or after Jan. 1, 2015 (i.e., NOLs generated under the New York tax reform). The Department indicated that such rules will be provided in a forthcoming, separate draft regulation. The Department also announced that comments to these draft regulations are due by Aug. 3, 2017. For an in-depth discussion of the proposed changes, see Tax Alert 2017-809. On May 25, 2017, Florida Governor Rick Scott signed HB 7109, a bill containing various tax reductions and modifications. Most notably, the tax rate on the total rent or license fee charged on the rental of commercial real estate is reduced to 5.8% (from 6.0%), effective Jan. 1, 2018. The tax rate in effect when the tenant or person occupies, uses or is entitled to occupy or use the property, is the rate that applies to the transaction; “[t]he applicable rate may not be avoided by delaying or accelerating rent or license fee payments.” Other sales and use tax law changes include the following: — Exempts from sales and use tax a data center owner’s or tenant’s purchase, lease or rental of property used to construct, maintain and operate computer server equipment at the data center. To qualify for the exemption, the owner and tenant must make a cumulative capital investment of $150 million after July 1, 2017, and the data center must meet specified megawatt capacity thresholds. Clawback provisions are included if the Florida Department of Revenue (DOR) determines that the owner and tenants no longer meet the qualification requirements. The DOR may not issue temporary tax exemption certificates after June 30, 2022. — Allows a purchaser of a taxable admission to seek a refund or credit of tax paid when the purchaser resells the admission to an entity that is exempt from sales and use tax for any reason other than sale for resale. The purchaser must provide proof of the exempt entity’s qualification for the exemption. If the purchaser purchases the admission from a related dealer that is a member of the same controlled group of corporations for federal income tax purposes, the purchaser must seek a refund or credit from the related dealer. If the related dealer has already submitted the tax to the DOR, it could then seek a refund or credit of tax paid. If the DOR determines the entity was not entitled to the exemption, it would look solely to the entity that provided the exemption documentation for recovery of the tax. This provision is effective starting Jan. 1, 2018. — Establishes sales and use tax exemptions for various goods related to women (effective Jan. 1, 2018), animal, and aquaculture health care, and for purchases of building material, pest control services and rental of tangible personal property used in new construction in Rural Areas of Opportunities. The exemptions related to animal and aquaculture are “remedial in nature and apply retroactively, but do not provide a basis for an assessment of any tax or create a right to a refund or credit of any tax paid before the effective date of this act.” — Establishes disaster preparedness (June 2 — 4, 2017) and back-to-school (Aug. 4- 6, 2017) sales tax holidays. Provisions of HB 7109 also increase the maximum amount of the Florida research and development tax credit available in 2018 to $16.5 million (from $9 million), and the amount of the Brownfield tax credit available in each fiscal year to $10 million (from $5 million). In addition, HB 7109 makes permanent the Community Contribution Tax Credit Program (previously set to expire June 30, 2018) and for fiscal years after FY2017-18 caps the credit at $10.5 million for projects that provide housing opportunities for low income households and $3.5 million for all other eligible projects. Further, state enterprise zone boundaries in existence before Dec. 31, 2015 are preserved through Dec. 31, 2020, to allow local governments to use them in administering their incentive programs within these boundaries In regard to property tax, HB 7109 amends the definition of inventory to include construction and agricultural equipment weighing 1,000 pounds or more that is returned to a dealership under a rent-to-purchase agreement and held for sale to customers in the ordinary course of business. Effective Jan. 1, 2018, certain property used to provide affordable housing to extremely low-, very low- and low-income persons or families is considered property used for a charitable purpose and qualifies for a 50% discount from ad valorem tax otherwise due. To receive the discount, qualified applicants must submit an application to the county property tax appraiser by March 1. Lastly, HB 7109 exempts 501(c)(3) assisted living facilities from property tax, first applicable to the 2017 property tax rolls. Unless otherwise provided, these changes take effect July 1, 2017. Fla. Laws 2017, Ch. 2017-36 (HB 7109), signed by the governor on May 25, 2017. California: The Franchise Tax Board scheduled for June 16, 2017, a second interested parties meeting on potential amendments to the market-based sourcing rules for sales of non-tangible property and services (Cal. Code of Regs., tit. 18, §25136-2). Click here for additional information about this meeting. California: On June 30, 2017, the Franchise Tax Board will hold an interest parties meeting to solicit input on proposed amendments to alternative apportionment method petition procedures (Cal. Code of Regs., tit. 18, §25137). Click here for additional information on this meeting. Iowa: In Romantix Holdings, Inc., the Iowa Court of Appeal (Court) upheld the Iowa Department of Revenue's (Department) determination excluding an out-of-state holding company from an Iowa consolidated filing because it was found to be exempt for Iowa income tax and not doing business in the state under Iowa’s unique nexus consolidated reporting statute even though it held intangible property used in Iowa by its subsidiaries. The Court also upheld the Department's denial of deductions for certain expenses allocated to the subsidiaries but paid by the holding company. It is unknown at this time whether the taxpayer will appeal this decision to the Iowa Supreme Court. The KFC Corp.1 decision seemed to indicate that the use of intangible property, such as trademarks, in Iowa was sufficient to create constitutional nexus for an out-of-state corporation. The Romantix Holdings decision raises the question whether use of intangible property owned by a holding company versus a franchisee, could be an activity protected against nexus-creation by virtue of the application of Iowa Code §422.34A(5) or whether there are other facts, such as payment for use of the intangible property not discussed in Romantix Holdings, that would be distinguishable from Myria Holdings,2 the case upon which it primarily relied. Romantix Holdings, Inc. et al v. Iowa Dep't. of Rev., No. 16-0416 (May 3, 2017). For more on this development, see Tax Alert 2017-800. Michigan: On May 22, 2017, the U.S. Supreme Court denied certiorari for six taxpayers3 that were appealing the Michigan Court of Appeals ruling upholding the constitutionality of the retroactive repeal of the Multistate Tax Compact (Compact). The Compact included a provision that allowed a taxpayer to elect to use the Compact's equally weighted three-factor apportionment formula to determine certain Michigan tax liabilities. For additional information on this development, see Tax Alert 2017-0843. New Jersey:In Xylem Dewatering Solutions, the New Jersey Tax Court ruled that gain on the 2010 sale of S corporation stock that the buyer and the S corporation shareholders elected under IRC §338(h)(10) to treat as a deemed sale of the S corporation's assets should be entirely allocated to New Jersey as non-operational income under its Gross Income Tax (i.e., the tax New Jersey imposes on personal income). Xylem Dewatering Solutions, Inc. v. Director, Div. of Taxation, Dkt. Nos. 011704-2015, 000056-2016, 000057-2016 (N.J. Tax Ct. April 7, 2017). For more on this development, see Tax Alert 2017-804. Texas: The Texas Supreme Court has been asked to review the Texas Court of Appeals (court) decision in Autohaus LP, in which the court held that a Texas car dealership was not allowed to include auto repair labor costs incurred as part of repair work to install automotive parts on customer-owned vehicles in its cost of goods sold (COGS) calculation. Hegar v. Autohaus LP, LLP, No. 03-15-00427-CV (Tex. App. Ct., 3d Dist., Feb. 24, 2017), petition for review filed (Tex. S. Ct. May 24, 2017). For more on the court’s ruling, see Tax Alert 2017-514. Illinois: The City of Chicago is not entitled to additional Chicago Hotel Occupancy Tax (CHAT) revenue on facilitation and service fees charged by online travel companies’ (OTCs) because these fees are not paid for the use of a hotel room and, therefore, are not part of the gross rental or leasing charge that comprise the CHAT base. In reaching this conclusion, the Illinois Appellate Court (Court) determined that customers pay for the OTCs’ service and facilitation fees in exchange for a convenient manner of making reservations and the benefits of the OTCs’ pre-negotiations with hotels, rather than the right to occupy hotel rooms. The Court restricted its decision to the specific OTCs before it. City of Chicago, Ill. v. Expedia Inc., No. 1-15-3402 (Ill. App. Ct., 1st Jud. Dist., April 26, 2017). New Jersey: A fee charged for a subscription that allows a customer to both stream and download videos on demand is subject to the state’s sales and use tax, because it is a bundled transaction containing taxable and non-taxable products. Under New Jersey law, specified digital products (e.g., electronically transferred digital audio-visual works, digital audio work, or digital book) are subject to the state’s sales and use tax unless valid exemptions exist; an exemption applies if the specified digital product is accessed but not delivered electronically to the purchaser. The New Jersey Division of Taxation determined that streaming is not within the meaning of “specified digital products” and, therefore, is not taxable. Downloading, however, falls within the meaning of “specified digital products,” and, as such, is taxable. Since the fee is for both taxable and nontaxable products, as part of a bundled transaction for one price, it is subject to the state’s sales and use tax. N.J. Div. of Taxn., N.J. State Tax news: A quarterly newsletter (Vol. 46, No. 1, Spring 2017). New Mexico: Vetoed provisions in HB 2 (1st special legislative session) would have expanded New Mexico’s gross receipts nexus provisions by establishing economic nexus provisions as well as marketplace provider provisions. In vetoing these provisions, Governor Susana Martinez said the “internet sales tax provisions were poorly crafted and could cause more harm than good” and that the marketplace provider provisions “requires a much closer and thorough vetting.” It should be noted that although the governor signed HB 2 on May 26, 2017, she line item vetoed most of the provisions in the bill. N.M. Gov., House Executive Message No. 3 (May 26, 2017). Oklahoma: New law (HB 2367) repeals the vendors compensation deduction under 68 O.S. §§1367.1 and 1410.1, effective July 1, 2017. Prior to the provision’s repeal, vendors were allowed a 1% deduction from sales and use tax for keeping records, filing reports and remitting tax when due; capped at $2,500 per month, per sales tax permit. Okla. Laws 2017, HB 2367, signed by the governor on May 24, 2017. Puerto Rico: New law (Act 25-2017) establishes notification requirements for merchants that conduct sales by mail, including internet sales, and whose only contact with Puerto Rico is through the purchaser who is a person resident in Puerto Rico or a person dedicated to industry or business in Puerto Rico — i.e., a “non-withholding agent.” Beginning on July 1, 2017, merchants that are "non-withholding agents" will be required to file the following notices: (1) each time a purchase is completed, the merchant must provide written notification to Puerto Rico purchasers about SUT reporting and payment obligations, including such notice in receipts and invoices; (2) the merchant must provide quarterly notice to the Puerto Rico Treasury Department (PRTD); and (3) the merchant must provide annual notice to Puerto Rico purchasers of their purchases. Merchants that import tangible property into Puerto Rico must submit an Import Declaration that provides detailed information on the 10.5% use tax related to the tangible property introduced in Puerto Rico. Act 25-2017 now requires that the Import Declaration include the 1% municipal SUT that will now be collected by the PRTD on imported tangible property. For additional information on this development, see Tax Alert 2017-824. Indiana: New law (SB 514) sunsets the enterprise zone (EZ) loan interest credit and EZ investment cost credit, and establishes the Entrepreneur and Enterprise District (EED) Pilot Program. Specifically, SB 514 prohibits taxpayers from receiving an EZ Loan Interest Credit for interest received on a qualified loan made after Dec. 31, 2017. In addition, taxpayers are entitled to receive an EZ Investment Cost Credit only for a qualified investment made before Jan. 1, 2018, and are entitled to receive a credit for a qualified investment made after Dec. 31, 2017 and before Jan. 1, 2028, if the Indiana Economic Development Corporation approves it before Jan. 1, 2018. Taxpayers can carry forward unused EZ loan interest credits and EZ investment cost credits attributable to a qualified loans/investments made before Jan. 1, 2018 to taxable years beginning before Jan. 1, 2028. Both credits expire Jan. 1, 2028. Provisions of SB 514 also establish the EED pilot program, under which an entrepreneur and enterprise district may be established in the cities of Lafayette and Fort Wayne. An EED district will expire the earlier of five years after it is designated as such or Dec. 31, 2022. Qualifying businesses in these districts may be eligible for grant funding and various property tax incentives. The property tax incentives include (1) excluding from the 30% valuation floor certain assessable depreciable personal property located in district, (2) providing a property tax deduction for qualified investments made in a district, and (3) providing a property tax abatement deduction for vacant buildings in the District. The credit sunset provisions take effect Jan. 1, 2018, while the EED pilot program provisions take effect July 1, 2017. Ind. Laws 2017, Pub. Law 238 (SB 514), signed by the governor on April 28, 2017. Texas: An appraisal district’s valuation of a broadcast satellite service provider’s (provider) personal property was not clerical error when it resulted from a disagreement with the provider’s claims that certain property was nontaxable intangible property, and was consistent with the appraisal district’s “appraisal judgment and techniques on valuing property.” In reaching this conclusion, the Texas Court of Appeals (Court) found that “clerical error” does not include an error that is or results from a mistake in judgment or reasoning in the making of the finding or determination. Thus, the trial court’s finding was not conclusory. In addition, the Court upheld the appraisal district’s use of its own appraisal theory to determine the value of the provider’s taxable property, finding that applying one methodology when another is either called for or would produce better results is not “clerical error.” Finally, the Court held that an amendment to the appraisal roll to exclude certain business personal property that was not maintained at the location described in the appraisal roll is not permitted by statute because business personal property existed at the described location. Dish Network Corp. and Blockbuster Corp. v. Collin Central Appraisal Dist., No. 05-15-00800-CV (Tex. App. Ct., 5th Dist., April 27, 2018). Delaware: New law (HB 66) amends return filing due dates to conform to the federal return dates. Partnership returns are due on the date on which its federal tax return is due (formerly the 30th day of the fourth month following the end of a partnership’s taxable year and the 30th day of the third month following the end of an S Corporation’s taxable year). Tentative corporate returns are due on or before April 15th if a calendar year taxpayer, and on or before the 15th day of the fourth month for fiscal year taxpayers (formerly, April 1 and the first day of the fourth month, respectively). Final corporate tax returns are due on the same date the taxpayer’s federal return is due. The due date of the first estimated tax payment is changed from April 1/first day of the fourth month to April 15/15th day of the fourth month. These changes are effective for all tax years beginning after Dec. 31, 2016. Del. Laws 2017, Ch. 18 (HB 66), signed by the governor on May 18, 2017. Delaware: New law (HB 66) provides that if the amount of license fee or tax omitted by a taxpayer on a return exceeds 25% of the amount stated on the return, tax may be assessed at any time within six years after the expiration date of the licenses to which the proposed assessment relates. This change took immediate effect. Del. Laws 2017, Ch. 18 (HB 66), signed by the governor on May 18, 2017. Oklahoma: New law (HB 2252) modifies the state’s voluntary disclosure agreement (VDA) provisions. A taxpayer may enter into a VDA with the Oklahoma Tax Commission (OTC) if the taxpayer meets the following: (1) does not have outstanding tax liabilities other than those reported under the VDA; (2) has not been contacted by the OTC in regard to the taxpayer’s obligation to file a return or make a payment; (3) has not collected taxes from others (e.g., sales and use tax, payroll tax) and not reported the tax; and (4) has not within the preceding three years, entered into a VDA for the type of tax owed. Taxpayers that have collected tax from others but did not report the tax may enter into a modified VDA. If the OTC agrees with the proposed payment terms under the VDA, the OTC will waive penalties and 50% of interest. The OTC also will limit the lookback period for which additional taxes may be assessed to three years for annually filed returns and 36 months for returns not filed annually (e.g., quarterly, monthly). Under a modified VDA, interest will not be waived unless such waiver is grated at the discretion of the OTC, and the lookback period is extended to include all periods in which tax has been collected but not remitted. These provisions take effect Nov. 1, 2017. Okla. Laws 2017, HB 2252, signed by the governor on May 19, 2017. Oklahoma: New law (HB 2380) directs the Oklahoma Tax Commission (OTC) to establish a voluntary disclosure initiative (i.e., a tax amnesty program) that will run Sept. 1, 2017 through Nov. 30, 2017. Taxpayers participating in, and complying with the terms of, the initiative will have otherwise applicable penalties, interest and other collections fees waived. Eligible taxes include the following: income tax for tax periods ending before Jan. 1, 2016; sales and use tax; withholding tax; mixed beverage tax; gasoline and diesel tax; and gross production and petroleum excise tax. To participate in the initiative, taxpayers must not have (1) outstanding tax liabilities other than those reported under this initiative; (2) been contacted by the OTC (or a third party acting on the OTC’s behalf), with respect to the taxpayer’s obligation to file a return or make a payment to the state; (3) collected tax from others (e.g., sales and use tax, payroll tax) and not reported the tax; and (4) within the preceding three years, entered into a voluntary disclosure agreement for the type of tax owed. The OTC will limit the lookback period for additional tax assessments to three taxable years for annually filed taxes or 36 months for taxes that are not filed annually (e.g., monthly, quarterly). Okla. Laws 2017, HB 2380, signed by the governor on May 24, 2017. Iowa: New law (HF 295) prevents local Iowa governments from passing and enforcing laws/ordinances (i.e., minimum wage increases, paid sick leave) to provide for conditions of employment that exceed or conflict with federal or state law. Further, HF 295 retroactively preempts any such ordinance enacted prior to the effective date of the Act. Iowa Laws 2017, HF 295, signed by the governor on March 30, 2017. For additional information on this development, see Tax Alert 2017-821. Maine: Proposed bills (L.D. 1612; L.D. 1618) would establish a universal family care system funded by payroll taxes levied on employees and self-employed individuals earning in excess of the Social Security wage base (currently $127,200). One proposal would extend eligibility only to parents with children aged newborn to three years old (L.D. 1618) while the other also would provide home care and community support benefits to senior citizens and those with disabilities. Both proposals would create a payroll tax of 12.4% on Social Security covered wages or self-employment income in excess of the annual cap set by the Social Security Administration for the year. Employers would be allowed to withhold 6.2% of the payroll tax from employees' covered wages and self-employed persons would pay the full 12.4% on covered earnings. A tax would also be assessed against unearned income similar to the Net Investment Income Tax established under the Affordable Care Act. For additional information on this development, see Tax Alert 2017-839. Nebraska: New law (LB 217) changes the deadline for filing Forms W-2 with the Nebraska Department of Revenue from the current February 1 to January 31, matching the federal deadline. The legislation is effective three months after enactment, making the accelerated deadline effective for calendar year 2017, with Forms W-2 due Jan. 31, 2018. The law also is amended to reflect that a notice of tax due will be sent to individual taxpayers if the income or taxes reported on the state income tax return differs from the income and taxes reported on Form W-2 or Form 1099. New York: Proposed bill (A 04738) would establish a single-payer system funded in part by premium taxes, including a payroll tax. Federal funds the state currently receives for Medicare, Medicaid, Family Health and Child Health Plus would be combined with these premium taxes in a New York Health Trust Fund for the operation of the single-payer system. A. 04738 was passed by the Assembly on May 16, 2017, and now heads for the Senate where, as in the last two prior years, it is expected to face challenges. For additional information on this development, see Tax Alert 2017-838. Washington: The U.S. Supreme Court will not review the Washington Supreme Court's decision in Dot Foods that the retroactive application of the state legislature’s amendment to a tax exemption under the state’s business and occupation tax law that narrowed its scope did not violate a taxpayer’s rights under due process, collateral estoppel, or separation of powers principles. Dot Foods, Inc. v. Wash. Dept. of Rev., No. 92398-1 (Wash. S. Ct. March 17, 2016), cert. petition denied, Dkt. No. 16-308 (U.S. S. Ct. May 22, 2017). Washington: New law (HB 1296) consolidates and simplifies the annual report and annual survey used for economic development tax incentives. Changes include renaming the annual accountability report the “annual tax performance” report, amending it for tax preferences that are claimed beginning calendar year 2018, and repealing the annual survey. The new report provisions permit taxpayers to choose to either include employment amounts by the total number of full-time, part-time, and temporary positions for the year the tax preference was claimed, or to allow the Washington Employment Security Department to release the same employment and wage information from unemployment insurance records to the state. The report generally must include the amount of tax preferences claimed for the calendar year the report covers, with special provisions for reporting of sales and use tax exemptions for sales of machinery and equipment to public research institutions. In addition, if the report is not timely filed, a percentage of the tax preference claimed or tax deferred is immediately due. The bill generally takes effect Jan. 1, 2018, except for certain specifically enumerated provisions. Wash. Laws 2017, Ch. 135 (HB 1296), signed by the governor on April 27, 2017. Multistate: Panelists on a recent Ernst & Young LLP (EY) webcast, Unclaimed property: Historic litigation and legislation and their impact on annual compliance, provided insights on recent federal and state legislative and judicial developments and emerging unclaimed property governance trends and current and future compliance issues. They highlighted developments in two important unclaimed property judicial actions. The first involves a challenge by several states against Delaware that seeks clarification of a federal statute dealing with allocation of the proceeds of certain uncashed checks but may evolve into a reconsideration of the U.S. Supreme Court's longstanding priority rules for determining which state can claim unclaimed funds. The other was a landmark decision by the U.S. federal district court in Temple-Inland striking down parts of Delaware's unclaimed property audit practice as "shocking the conscience." In response, Delaware enacted significant legislative and regulatory revisions to its existing unclaimed property laws and the panelists described changes to its audit practices intended to correct the glaring deficiencies of its programs identified by the court. Additionally, the panelists discussed ongoing efforts to revise the Uniform Unclaimed Property Law, which serves as the base for the unclaimed property laws of many states. This webcast is now available for replay on the EY Thought Center website. For a summary of the webcast, see Tax Alert 2017-794. Federal: U.S. Trade Representative Robert Lighthizer has notified Congress of the Trump Administration's intent to renegotiate the North American Free Trade Agreement (NAFTA). The May 18, 2017 letters to majority and minority leaders of Congress mark the start of a 90-day period before formal NAFTA renegotiations may begin in accordance with the provisions of the Bipartisan Congressional Trade Priorities and Accountability Act of 2015. Given the 90-day notice requirement, formal negotiations with Canada and Mexico could begin as early as August. For additional information on this development, see Tax Alert 2017-820. International: The General Authority of Zakat and Tax (GAZT) of Saudi Arabia is moving swiftly towards implementation of the Value Added Tax (VAT) regime by Jan. 1, 2018 and is conducting meetings to create awareness among business groups. During these VAT awareness sessions, GAZT officials have highlighted the key provisions under the proposed VAT law including the penalties applicable in the case of non-compliance. For more on this development see, Tax Alert 2017-854. International: Taxable persons subject to VAT who record their customers’ payments through accounting or management software or cash register systems, will be required to use certified secure software or systems that meet conditions of data inalterability, security, retention and archiving, beginning Jan. 1, 2018. This is a new anti-fraud measure. For more on this development, see Tax Alert 2017-846. International: China’s Ministry of Finance and State Administration of Taxation jointly issued Circular 37 on April 28, 2017 intended to reduce the current four Value Added Tax (VAT) rate brackets to three by eliminating the 13% rate. Circular 37 will become effective as of July 1, 2017. The changes proposed in Circular 37 are aimed at simplifying VAT rates, reducing tax costs, and promoting economic development in China. For additional information on this development, see Tax Alert 2017-834. International: Changes to the Italian Value Added Tax (VAT) law, introduced by Law Decree n. 50/2017 (the Decree), entered into force on April 24, 2017. Specifically, the law was amended to: (1) extend the split payment mechanism; (2) modify the deadline for recovering input VAT; and (3) reduce the threshold, without certification, for crediting VAT. It is important to note that the Decree is issued directly by the Italian government and must be converted into law by its parliament within 60 days otherwise it is as if it had never been effective. The parliament is empowered to modify the content of the law decree. For additional information on this development, see Tax Alert 2017-830. Multistate: On Tuesday, June 6, 2017, from 1:00-2:30 p.m. EDT (10:00-11:30 a.m. PDT), EY will host a webcast discussing current developments in state and local tax controversy. The following topics will be discussed on the upcoming webcast, which will include participation from current and former government representatives: (1) Comparison of the tax appeals processes in California, Pennsylvania and Texas; (2) California State Board of Equalization update with Chairwoman Diane Harkey; and (3) Update on the state and local tax impact of federal tax reform. To register for this event, go to State and local tax controversy. Multistate: On June 21, 2017, from 1:00-2:30 p.m. EDT New York (10:00-11:30 a.m. PDT Los Angeles), EY will host a webcast on U.S. multistate payroll tax developments. In this webcast, our panelists will explain the general concept of nexus, its symbiotic ties to employment taxes, how sourcing rules differ for income tax withholding and employer tax purposes and how proposed federal legislation could reduce compliance burdens for both businesses and employees. The panelists also will share the key findings from the EY/Bloomberg BNA 2016 Multistate Payroll Tax Compliance Survey identifying trends in compliance, governmental audits and payroll tax policy design. Specific topics of focus will include: (1) 2016 survey results — key compliance trends; (2) 2016 survey results — state and local tax audit trends; (3) 2016 survey results — policies governing business travelers; (4) business tax nexus generally; (5) employment and voluntary income tax withholding and their impact on nexus; (6) sourcing for income tax withholding vs. unemployment insurance; (7) policy design considerations; and (8) where and how benchmarking can matter. Click here to register for this event. Because the matters covered herein are complicated, State and Local Tax Weekly should not be regarded as offering a complete explanation and should not be used for making decisions. Any decision concerning matters covered herein should be reviewed with a qualified tax advisor. 3 IBM Corp. v. Mich. Dept. of Treasury, petition for cert. denied, Dkt. No. 16-698 (U.S. S. Ct. May 22, 2017); Gillette Commercial Operations North America and Subs. v. Mich. Dept. of Treasury, petition for cert. denied, Dkt No. 16-697 (U.S. S. Ct. May 22, 2017); Sonoco Products Co. v. Dept. of Treasury, petition for cert. denied, Dkt. No. 16-687 (U.S. S. Ct. May 22, 2017); Goodyear Tire & Rubber Co. v. Mich. Dept. of Treasury, petition for cert. denied, Dkt. No. 16-699 (U.S. S. Ct. May 22, 2017); Skadden, Arps, Slate, Meagher & Flom LLP v. Mich. Dept. of Treasury., petition for cert. denied, Dkt. No. 16-688 (U.S. S. Ct. May 22, 2017); DIRECTV Group Holdings, LLC v. Mich. Dept. of Treasury, petition for cert. denied, Dkt. 16-763 (U.S. S. Ct. May 22, 2017). Document ID: 2017-0896 |
