The rise of internet sales has created a tax problem for states. States are having difficulty getting revenue from these sales because the sellers lack nexus. In the legal community, that nexus is known as a connection with a state which allows for it to exercise jurisdiction over a vendor.…
Earlier in 2017, Premier Netcomm Solutions LLC (“Premier”) lost on reconsideration in New Jersey tax court. The case dealt with the taxability of software as a service (“SaaS”) dating back to an audit from 2004 through 2005. After initially beating for state, the court overturned a prior decision on reconsideration,…
Over the past several years software as a service (“SaaS”) has been a booming industry. Pioneers in the cloud computing industry, like Salesforce, have developed web based applications that offer a wide range of services to the user. Driven by competitors such as Microsoft, Adobe, Sap, ADP, Oracle, IBM, Intuit…
Effective August 1, 2016, Pennsylvania has joined the ranks of states attempting to expand their sales and use tax jurisdiction over digital downloads. With out-of-state internet sales taking away sales tax revenue from the states in conjunction with the sharp decline in “hard copy” sales of various media, states are…
Potential good news for the growing mobile workforce. Currently, there is a Bill pending in the US Senate to simplify the exposure, withholding, and reporting of state income taxes for both employers and employees traveling across state lines to perform their job functions. The US House of Representatives already passed…
Tennessee is the latest of states to jump on the economic nexus bandwagon. In an effort to sidestep the physical presence the proposed rule would require out-of-state dealers that engage in the regular or systematic solicitation of consumers in Tennessee through any means and make sales exceeding $500,000 to Tennessee…
If states could impose tax on every company that makes a sale within its borders, they would. Luckily, the Commerce Clause of the Constitution requires something known as “nexus,” or a connection, between a company and state in order for that company to be subject to state and local taxes.…
Hawaii was the most recent in a line of states to take a stance in the long tax battle between online travel companies, such as Priceline, Expedia and Orbitz, and states over what is commonly referred to as “tourist development taxes,” or “bed taxes.” Over the last couple of years,…
Florida’s hotel reservation industry recently received an important victory relating to Tourist Development Tax (“TDT”). TDT is a tax imposed on the privilege of renting, leasing or letting “for consideration any living quarters or accommodations in any hotel . . ., or condominium for a term of six months or…
On December 14, 2015, the Supreme Court of the State of Utah issued its ruling in the case of DIRECTV and DISH Network v. Utah State Tax Commission. At issue in this case was a tax scheme that provided a sales tax credit for “an amount equal to 50%” of…