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Tax Alerts

Tax Briefing(s)

Build Back Better Act Infrastructure Investment and Jobs Act 2021 Year-End Tax Planning

IRS Reminds Taxpayers to Protect Personal and Financial Information Online
The IRS has reminded taxpayers about the continued importance of protecting personal and financial information online during National Cybersecurity Month. Further, the Service has urged parents, fam...

IRS and Organizations Highlight Charity Fraud Awareness
The IRS joined international organizations and other regulators in highlighting Charity Fraud Awareness Week on October 18-22. The campaign is run by an international partnership of charities, regul...

IRS Issues Information on Valid Research Credit Claims
The IRS issued information that taxpayers will be required to include for a research credit claim for refund to be considered valid. The current Treasury regulations require a refund claim to forth su...

IRS Updates Process for FAQs on New Tax Legislation
The IRS has updated its process for certain frequently asked questions (FAQs) on newly enacted tax legislation. The Service will now announce significant FAQs on newly enacted tax legislation, as well...

IRS Updates Audit Technique Guides on Real Property Foreclosures and the Construction Industry
The IRS has updated its real property foreclosure and construction industry Audit Technique Guides. An Audit Technique Guide focuses on developing highly trained examiners for particular market segmen...

Final Regulations Contain New User Fees for Estate Tax Closing Letter
The IRS issued final regulations that establish a new user fee of $67 for taxpayers requesting an IRS Letter 627, also called an estate tax closing letter. The fee is effective for requests for estate...

FBAR Relief Available for Victims of Recent Natural Disasters
The Financial Crimes Enforcement Network (FinCEN) is providing filing relief to taxpayers who have been adversely affected by Hurricane Ida, the California Wildfires, Tennessee Severe Storm and Floodi...

AL - Guidance on Alabama annual tax account license renewal issued
Alabama issued a notice informing sales and use taxpayers that the applicable administrative rule requires annual renewals of the following tax account licenses:Sales tax;Rental tax;Sales use tax;Lodg...

AK - Alaska landing tax constitutional
The Supreme Court of Alaska held that the state landing tax does not violate the Import-Export and Tonnage Clauses of the United States Constitution or 33 U.S.C. §5(b).BackgroundIn this case, two com...

AZ - No local rate changes effective September 1
There are no local Arizona transaction privilege tax (TPT) changes effective September 1, 2021. The TPT rate chart can be viewed at: https://azdor.gov/sites/default/files/media/TPT_RATETABLE_09012021...

AR - Taxpayer not entitled to farm machinery and equipment exemption
A taxpayer was properly subject to Arkansas sales and use tax as the taxpayer was not entitled to farm machinery and equipment exemption because he failed to show the purchased equipment was used excl...

CA - November tax news discusses form 592, Calsavers notices, and other filing information
In its November 2021 issue of tax news, the California Franchise Tax Board (FTB) provides information on a variety of corporate and personal income tax issues, including the following:Guidance on subm...

CO - Heart monitor does not qualify for medical devices exemption
The Colorado Department of Revenue (department) issued a letter ruling discussing the application of sales and use tax on the retail sale of heart monitors. In this matter a company (taxpayer) sold he...

CT - Municipalities can provide temporary tax relief
Municipalities and taxing districts can adopt programs for fiscal years ending June 30, 2022, and June 30, 2023, to provide temporary Connecticut property tax or municipal utility charge relief to tax...

DE - Hurricane IDA affected taxpayers can file returns by January 3, 2022
Delaware taxpayers located in areas affected by Hurricane Ida, that have been designated as disaster areas, will have until January 3, 2022 to file tax returns and submit tax payments.Â The Delaware ...

DC - Cigarette surtax increase announced
The surtax for cigarettes is increasing one cent in the District of Columbia.New Surtax RateEffective October 1, 2021, the surtax on a pack of cigarettes will increase to 51¢ (currently, 50¢). The s...

FL - Solar panels on federal air base taxable
A Florida taxpayer’s tangible personal property used in connection with a solar energy generating facility within the federal Air Force base was taxable because once leased, the property is no longe...

GA - Sales and use tax treatment of fundraising activities conducted by organizations exempt from federal income discussed
For sales and use tax purposes, Georgia issued a policy bulletin providing guidance to organizations exempt from federal income tax under Internal Revenue Code (IRC) 501(c)(3) ("501(c)(3) organization...

HI - Kauai County enacts transient accommodations tax
Kauai County, Hawaii, has enacted a transient accommodations tax (TAT) of 3 percent effective October 1, 2021. Mayor Derek S. K. Kawakami signed Bill No. 2829 which levies the TAT on every taxpayer th...

ID - 2021 individual income tax rate schedule released
The Idaho State Tax Commission has released the personal income tax rate schedule for computing tax liability for tax year 2021. Idaho income tax brackets are adjusted for inflation each year. The ind...

IL - Online retailer facilitating sale of third-party goods not a marketplace facilitator
The Illinois Department of Revenue (department) issued a letter ruling stating that an online retailer (taxpayer) was not considered a marketplace facilitator for Illinois sales and use tax purposes b...

IN - Review board's determination regarding property tax refund claim remanded
Indiana has updated its sales tax guidance on drop shipments to note that a purchaser is required to collect Indiana sales tax, not use tax, on retail transactions in Indiana, unless a specific exempt...

IA - Updated sales and use tax guidance issued
The Iowa Department of Revenue has issued updated general guidance on sales and use tax in the state. The guidance contains information such as permit requirements, tax rates, filing requirements, ref...

KS - Disabled access credit limit increased
For personal income tax purposes, the Kansas Department of Revenue (department) has issued a notice discussing recent amendments to the disabled access credit. The credit applies to Kansas residents w...

KY - 2021 property tax rate announced
For 2021, the Kentucky state real property tax rate is 11.9¢ per $100 of assessed value. The rate was 12.2¢ in 2020. This is the first time the rate has decreased since 2008. Release, Kentucky Depa...

LA - Consolidated filers required to file electronically
Beginning in December 2021, Louisiana sales tax consolidated filers are required to electronically file returns and remit taxes. Consolidated filers are approved by the Louisiana Department of Revenue...

ME - Paper mill's tax abatement request was correctly denied
For Maine property tax purposes, the Supreme Court affirmed the superior court’s decision affirming the State Board of Property Tax Review’s (Review Board’s) denial of a paper mill’s tax abate...

MD - Evidence for claiming refund under statute of limitation discussed
The Court of Special Appeals of Maryland (court), in a personal income tax matter, determined that in a situation where a taxpayer mails a claim for a refund, but the Comptroller of Maryland does not ...

MA - Denial of manufacturing classification affirmed as taxpayer was not engaged in any manufacturing activities
For property tax purposes, the taxpayer could not be classified as a manufacturing corporation for the year 2019 because it was not engaged in any manufacturing activities in Massachusetts as of Janua...

MI - Feminine hygiene products are exempted
Feminine hygiene products are exempt from Michigan sales and use tax. H.B. 5267, Laws 2021, effective February 2, 2021; S.B. 153, Laws 2021, effective February 3, 2021...

MN - Taxpayer not seminary of learning; education institution exemption denied
A child care center (taxpayer) was not entitled to a Minnesota property tax exemption as an educational institution because the taxpayer was not a "seminary of learning". In this matter, the taxpayer...

MS - City of Sardis repeals tourism tax
Effective July 1, 2021 the city of Sardis will repeal its tourism tax. The Sardis tourism tax is levied at the rate of 3% on the gross proceeds derived from sales of prepared foods at restaurants and ...

MO - Food retail sales subject to reduced food tax rate
The Missouri Department of Revenue (department) issued a letter ruling discussing the applicability of reduced food tax rate on the sales of health supplements, protein powders and bars. In this matte...

MT - Non resident’s capital gains from land sale properly subject tax
A non resident who sold a property in Montana but did not report the same in a Montana personal income tax return was properly subject to additional personal income tax assessment. In this matter, the...

NE - Social security income exemption initiated
Nebraska initiated plans to provide an exemption from personal income tax for all social security income.Current TreatmentIndividuals computing Nebraska personal income tax liability can subtract soci...

NV - State high court upholds decision invalidating parts of 2019 MBT legislation
The Nevada Supreme Court affirmed a district court decision that invalidated portions of a 2019 law (S.B. 551) affecting the rates of the modified business tax. The law had resulted in Nevada continui...

NH - Disaster-related nexus waiver provisions enacted
New Hampshire has enacted provisions stating that no out-of-state businesses or employees who are in the state to perform disaster-related or emergency-relate work will be deemed to have established s...

NJ - Tax assessor was not barred from serving as taxpayer's appraiser
For New Jersey property tax purposes, a certified tax assessor was not disqualified to serve as the taxpayer’s appraiser because no statute or regulation barred certified tax assessors’ from servi...

NM - Guidance on gross receipts tax holiday revised
The New Mexico Taxation and Revenue Department has revised its publication providing information on the gross receipts tax holiday. The publication covers numerous topics, including a general summary ...

NY - Petition granted as taxpayer entitled to child and dependent care credits
A taxpayer’s petition for the redetermination of deficiency or for refund of New York State personal income tax was granted as the taxpayer provided sufficient proof to qualify for child and depende...

NC - Guidance on impact of federal legislation on personal income tax returns
The North Carolina Department of Revenue issued a notice that explains the impact of the American Rescue Plan of 2021 and the Consolidated Appropriations Act of 2021, on North Carolina’s 2020 person...

ND - Summary of 2021 legislation released
North Dakota issued a summary containing highlights of corporate and personal income tax legislation enacted in 2021, including laws that:expanded the credits for nonprofit private school contribution...

OH - Leased equipment not qualified for casual sales exemption
A road construction company (taxpayer) was properly denied Ohio casual sales tax exemption as the taxpayer’s leases ceased to be occasional, casual, or isolated and instead became a business. In thi...

OK - Employer blood donation credit enacted
Oklahoma has enacted a nonrefundable income tax credit for employers whose employees participate in a blood drive that is organized with a nonprofit blood donation organization. The blood drive may no...

OR - Maximum assessed value of taxpayer's property did not require recalculation
For Oregon property tax purposes, the taxpayer’s property for the tax year 2019-2020 did not require a recalculation of its maximum assessed value (MAV) based on the complete renovation and redevelo...

PA - Guidance regarding taxation of equipment rentals and equipment rentals with operators issued
The Pennsylvania Department of Revenue has issued guidance regarding the taxation of equipment rentals and equipment rentals with operators, including but not limited to cranes, concrete pumping and e...

RI - Taxpayers informed of changes in certain income tax credits
Rhode Island issued a notice informing taxpayers of the changes made to certain Rhode Island corporate and personal income state tax credits because of the recently enacted legislation. The legislatio...

SC - Exemptions for veterans discussed
The South Carolina Department of Revenue has reminded veterans and military personnel that they may be eligible for certain property tax exemptions.Service-connected DisabilitiesVeterans with permanen...

SD - Legislative changes expanding property tax relief for eligible landowners discussed
South Dakota has issued a release providing information on the legislative changes made to the riparian buffer strip program that expanded the property tax relief for eligible landowners. Applications...

TN - Guidance provided on filing a claim for refund when dealer is unresponsive
Effective October 1, 2021, a customer must follow a specific procedure to, in limited instances, file a claim for refund of erroneously paid sales or use tax directly with the Tennessee Department of ...

TX - Foodservice management company provided nontaxable consulting services
A foodservice management company (taxpayer) was not subject to Texas sales and use tax as the taxpayer was providing consulting services, not information services, because the taxpayer’s use of clie...

UT - Primary residential exemption denied
For Utah property tax purposes, the taxpayer was not entitled to receive a primary residential exemption because he failed to meet the burden of showing that he was entitled to the exemption. The taxp...

VT - Guidance on real estate withholding updated
Vermont issued a fact sheet informing personal income taxpayers that state income tax is due on capital gains realized from the sale of Vermont real property, whether the seller is a resident, part-ye...

VA - Audit staff directed to review taxpayer's exemption certificate documentation
A taxpayer appealed against the Virginia Department of Taxation’s (department’s) rejection of exemption certificates and the audit process itself because the taxpayer was not provided the opportun...

WA - Local tax rate changes announced
The following Washington cities and county will impose local sales and use tax rate changes effective January 1, 2022.Local Rate ChangesThe city of Bainbridge Island increases its local rate by 0.1%, ...

WV - Home inspection services do not qualify as exempt professional services
Home inspection services do not qualify as professional services exempt from West Virginia sales and use tax.Professional ServicesThe term "professional service" is not defined in the tax code. Howe...

WI - Guide to Wisconsin wage statements and information returns updated
The Wisconsin Department of Revenue (department) has released an updated version of its guide on wage statements and information returns for personal and corporate income tax purposes. The guide provi...

WY - Guides and outfitters subject to lodging assessment
Beginning July 1, 2021 guides and outfitters must collect the Wyoming lodging assessment. They are still exempt from local lodging taxes. Lodging services provided by guides and outfitters include pla...