SeeSALT Blog
SeeSALT attorneys Carley Roberts & Mike Le partnered with their Pillsbury tax colleagues Nora Burke & Hannah Hollingsworth to detail the impact of COVID-19 on the IRS and States Extended Tax Payment Deadlines.
Takeaways of the recent article include:
- The IRS announced that individuals and businesses may defer both federal income tax payments and filings due April 15 until July 15, without any cap on tax liability.
- California updated its tax extension to follow the IRS’s extension.
- Many other states are starting to align with the IRS’s extension or have announced other tax relief.
For the full article, please click here.
A very interesting and heartening decision was just handed down by the Michigan Court of Appeals in 
On March 6, 2020, the South Carolina Administrative Law Court entered an order in 
The New Mexico Court of Appeals decided a case illustrating the heavy risks of failing to comply with a court’s order. Specifically, the Court of Appeals upheld the District Court’s full dismissal of a taxpayer’s refund claim for violating a discovery order. In Bowman v. Manforte, the taxpayer sought a refund of Gross Receipts Tax arguing that her income was exempt as wage income rather than income from an independent business. The New Mexico Department of Revenue Services (“Department”) suspected the taxpayer’s federal tax return would reflect deductions against the income that would be permitted only if the income were business income and not wages for federal income tax purposes. The taxpayer refused to produce the federal tax return, claiming that the return was privileged from civil disclosure under New Mexico’s tax secrecy law. The Department brought the taxpayer’s refusal before the District Court and twice obtained orders requiring the taxpayer to produce the return. After the taxpayer failed to comply with the disclosure orders, the District Court took the dramatic step of dismissing the taxpayer’s refund claim altogether. The taxpayer appealed to the Court of Appeals. 
There have been two interesting developments in Arizona as a result of Wayfair. First, the Arizona House of Representatives pushed forward a resolution, H.C.M. 2006, last week to formally ask Congress to enact uniform national legislation to simplify sales tax or similar tax collection by all states and to reduce the burden of tax compliance on remote sellers. In addition, the Arizona Senate pushed forward S.C.M. 1003, requesting Congress to do the same, on February 13. Each bill needs to be sent to the other chamber for final passage. If either bill is passed, the measure would be transmitted to the federal government. Arizona would be the first state requesting federal intervention to ensure sales tax compliance simplicity in all states by passing state legislation.
A Washington state trial judge partially granted the state’s motion to dismiss a lawsuit challenging the validity of a recently enacted Washington tax measure that increases the state’s Business & Occupation Tax (B&O Tax) on large, out-of-state financial institutions. The Plaintiffs, the Washington Bankers Association and American Bankers Association (collectively, the “Bankers Associations”) filed a challenge to invalidate House Bill 2167, which targets large out-of-state financial institutions by increasing Washington’s B&O Tax rate if the institution’s annual net income equals to or exceeds $1 billion. The Bankers Associations sought to invalidate the law, which became effective January 1, 2020, on the grounds that the measure violates: (1) the state’s constitutional requirement to introduce a bill at least 10 days prior to the adjournment of a legislative session; and (2) the U.S. Constitution’s Commerce Clause because it discriminates against out-of-state financial institutions by imposing a higher tax rate on out-of-state financial institutions versus in-state institutions. The state moved to dismiss the complaint, focusing on the procedural issue under the state’s constitution rather than the apparent discriminatory nature of the law. Specifically, the state asserted that the “enrolled bill doctrine” enjoined the Washington trial court from reviewing evidence, other than the final enrolled bill itself, to show that a constitutional violation occurred during the enactment process.
The Massachusetts Supreme Judicial Court held that sales tax applied to subscription fees for three online Citrix products, “GoToMyPC,” “GoToAssist” and “GoToMeeting,” which allow users to remotely access other users’ computers. Citrix Systems, Inc. v. Comm’r of Revenue, No. SJC-12741 (Mass. Feb. 5, 2020). In so holding, the Court affirmed the Massachusetts Appellate Tax Board’s determination that Citrix made taxable sales of tangible personal property, rather than nontaxable sales of services.
On January 29, 2020, the U.S. Court of Appeals for the Seventh Circuit held the Tax Injunction Act did not bar a federal lawsuit challenging property tax assessments on equal protection grounds because the taxpayers that brought the suit did not have a plain, speedy and efficient remedy in the Illinois state courts.
On January 29, 2020, the Louisiana Supreme Court issued a 