SeeSALT BlogPillsbury SALT partner Breann Robowski will present at this year’s Wichita Property Tax Conference.
Articles Posted in Issues
NYU Introduction to State and Local Tax Conference
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Pillsbury SALT attorney Aruna Chittiappa will be presenting at NYU’s Introduction to State and Local Tax conference taking place July 22-23, 2024 in New York.
California’s 2024-2025 Budget Seeks to Block $1.3 Billion of Refunds for Water’s Edge Taxpayers, Suspend NOL Deductions, and Limit Tax Credit Utilization
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The May Revision of California’s 2024-2025 state budget seeks to block refund claims, worth approximately $1.3 billion for historical tax years, and $200 million per year going forward, by codifying informal guidance recently rejected by the Office of Tax Appeal’s (OTA) decision in the Matter of the Appeal of Microsoft Corporation & Subsidiaries (Appeal of Microsoft) and by granting the Franchise Tax Board’s (FTB) quasi-legislative rulemaking authority exempt from the procedural protections afforded by the Administrative Procedure Act. The May Revision also proposes to suspend net operating loss (NOL) deductions and limit tax credit utilization to $5 million per year for tax years 2025-2027; however, the legislature proposes to apply the changes to tax years 2024-2026 instead.
2024 Summer Tax Institute
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Pillsbury SALT partner Robert P. Merten III will participate as an instructor in the 2024 Summer Tax Institute put on by the UC Davis School of Law.
COST’s 2024 Intermediate/Advanced State Income Tax School
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Pillsbury SALT partner Evan Hamme will be presenting at COST’s 2024 Intermediate/Advanced State Income Tax School on May 20.
Proposed Initiative to Amend San Francisco Business Taxes
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A proposed initiative (available here) is being circulated to place on the November 5, 2024 ballot, an ordinance amending the Business and Tax Regulations Code effective January 1, 2025.
New Jersey Issues Guidance on Adoption of Federal Partnership Audit Regime
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On April 5, 2024, the New Jersey Division of Taxation issued guidance discussing New Jersey’s adoption of the federal centralized partnership audit regime enacted as part of the federal Bipartisan Budget Act of 2015, P.L. 114-74. The guidance was released over a year after the Senate and General Assembly of the State of New Jersey approved P.L. 2022, c. 133 on December 22, 2022. This law applies to any adjustments to a taxpayer’s federal taxable income on or after January 1, 2020.
Reminder: “Gross” Does Not Mean “Net” – California OTA Holds All Repatriated Dividends Must Be Included in Sales Factor
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The California Office of Tax Appeals (OTA), in a decision marked “not precedential” in the Matter of the Appeal of Microsoft Corporation & Subsidiaries, held 100 percent of repatriated dividends under the Tax Cuts and Jobs Act (TCJA) must be included in the taxpayer’s sales factor denominator.
- First, the OTA rejected the “matching principle” included in FTB Ruling 2006-01, and supported its holding based primarily on the plain language of Cal. Rev. & Tax. Code § 25120(f)(2), and legislative history.
- Second, the OTA rejected the FTB’s argument that repatriated dividends constitute a substantial and occasional sale of property under FTB Regulation 25137(c)(1)(A).
- Last, the OTA determined the FTB failed to carry its burden to show the taxpayer’s inclusion of 100 percent of repatriated dividends in the sales factor denominator is distortive under Cal. Rev. & Tax. Code § 25137.
- Anyone may submit a request to the OTA requesting the decision be marked “precedential.”
COST’s 2024 Spring Conference
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SALT partners Zachary Atkins and Evan Hamme will speak at COST’s upcoming Spring Conference.
Winter Storm Relief – California’s 2024 Extended Deadlines to File and Pay Taxes
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The California Franchise Tax Board (FTB), California Department of Tax and Fee Administration (CDTFA) and California Employment Development Department (EDD) announced tax relief for certain California counties affected by severe winter storms.