Daily Tax Report: State

Trump Review of Colleges’ Tax-Exempt Status Faces Legal Hurdles

Deloitte Takes Aim at U.S. Legal Services Market with Tech Unit

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Deloitte Takes Aim at U.S. Legal Services Market with Tech Unit

Deloitte is ramping up its efforts to provide legal-related services to companies in the U.S., a move likely to mean more competition for law firms.

In Bid for Manhattan D.A., Trump’s Taxes Meet Hedge Fund Riches

It’s the real-life “Law & Order,” the bane of mobsters and crooked politicos, killers and Wall Street greed, and one that gets a peek into President Donald Trump’s tax returns.

Trump Review of Colleges’ Tax-Exempt Status Faces Legal Hurdles

President Donald Trump’s call to investigate the nonprofit status of universities could run into legal problems, including guardrails Congress placed on the IRS after a scandal over the agency’s scrutiny of nonprofit status of conservative political groups.

Digital Stalemate • Navigating Relief • State Budget Shortfalls

This weekend roundup of Bloomberg Tax Insights looks at the digital tax impasse; state and local government responses to budget shortfalls; navigating the Covid-19 relief programs; sticking with ERISA for severance plans; transfer pricing adjustments in the downturn; deducting disgorgement; sales and marketing service providers in China; tax advantages of farm bankruptcy; the complexities of tax litigation in Pennsylvania; private investment in public equity; the pro-debt bias in corporate taxation; and Italy’s snubbing of an EU directive.

N.J. May Borrow $9.9 Billion Under Murphy Deal With Lawmakers

New Jersey Governor Phil Murphy and Democratic legislative leaders have agreed on a plan for the state to borrow as much as $9.9 billion to cope with revenue losses from the coronavirus outbreak.

Democrats Come Up Short Again in Bid to Investigate Trump (1)

House Democrats once again fell short in a high-profile attempt to dig into what they say is President Donald Trump’s possible misconduct -- this time with a failed effort to get access to his financial records before the November election.

NYC Trump Tax Case Gets July 16 Hearing After High Court Rules

Donald Trump will get a chance next week to try new arguments against Manhattan District Attorney Cyrus Vance’s subpoena of his tax returns and other financial records after the U.S. Supreme Court rejected the president’s claim of immunity in the matter.

Featured Topics

credits and incentives

New Jersey Panel Again Rips Tax Break Programs

Breaking Up is Hard to Do: Taxes a Tricky Part of Divorce

Mississippi Extends Tax Credits for Historic Restorations

individual income tax

In Bid for Manhattan D.A., Trump’s Taxes Meet Hedge Fund Riches

Trump Rape Accuser Says Supreme Court Tax Ruling Helps Her Case

New York State Urban Development Corp. to Issue $2.3 Billion

sales and use tax

TAX VIRUS BRIEFING: OECD Wants to Help Repair Covid Damage

Sales Surging, Online Sellers Face Expiring Virus Tax Deferrals

Michigan Tax Deferrals Approved by Lawmakers Get Governor’s Ax

South Carolina DOR Issues Information Letter Providing Overview of 2020 Tax Legislative Updates

The South Carolina Department of Revenue July 9 issued an information letter providing 2020 tax legislative updates impacting corporate income, individual income, sales and use, and excise taxes. Due to COVID-19, legislative activity was limited during the legislative session, and the General Assembly will reconvene during the upcoming months with adjournment by Nov. 8. The General Assembly also extended the fiscal year July 1, 2019 – June 30, 2020 budget due to COVID-19, with the intent to approve a Fiscal Year 2021 budget when the session reconvenes. The bills passed in 2020: 1) create the South Carolina Housing Tax Credit; 2) extend an income tax credit for purchases of qualifying manufactured homes through July 1, 2024; 3) consolidate Clarendon County School Districts 1 and 3 into Clarendon County School District 4, effective July 1, 2021; and 4) extend an exemption for sales of qualifying manufactured homes to July 1, 2024. [S.C. Dep’t of Revenue, Info. Letter No. IL 20-19, 07/09/20]

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Texas Comptroller Affirms Sales Tax Assessment, Finds Heating, Ventilation, Air-Conditioning Contractor’s Repair, Remodeling Services Taxable

The Texas Comptroller of Public Accounts May 4 affirmed the Tax Division’s (staff) sales and use tax assessment against Taxpayer, adopting the Administrative Law Judge’s (ALJ) recommendation. Taxpayer was a heating, ventilation, and air conditioning contractor. The staff issued an assessment with late penalties and accrued interest for unreported taxable repair and remodeling services. Taxpayer requested a redetermination, contending that the tax was erroneously assessed on nontaxable new construction services. The ALJ noted that: 1) Taxpayer’s contracts and sales invoices were incomplete and didn’t provide sufficient evidence to support the new construction contention; 2) the staff met its burden to show Taxpayer provided taxable repair and remodeling services; and 3) Taxpayer failed to demonstrate by a preponderance of the evidence that any sales were scheduled erroneously. Accordingly, the comptroller affirmed the staff’s audit assessment. [Tex. Comptroller of Pub. Accts., Comptroller’s Dec., Hearing No. 115,969, Accession No. 202005019H, 05/04/20]

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Texas Comptroller Affirms Fraud Penalty for Underreporting Mixed Beverage Excise, Sales Tax

The Texas Comptroller of Public Accounts May 29 adopted the Administrative Law Judge’s (ALJ) recommendation affirming sales and use and excise tax assessments against Taxpayer. The Tax Division (staff) audited Taxpayer’s bar for mixed beverage gross receipts tax and mixed beverage sales tax. The auditor administered a pour test, and on finding certain reporting discrepancies, completed the assessments, including tax, penalties, and interest. Taxpayer requested redetermination. The staff agreed to certain amendments in the audits but denied further adjustments. Taxpayer protested, contending further adjustments were warranted due to employee theft, and Taxpayer wasn’t liable for a fraud penalty. The ALJ found that: 1) Taxpayer failed to show error in the audits; and 2) the staff demonstrated the Taxpayer’s fraud or willful intent to evade the payment of tax during the audit periods, and therefore, waiver of the 50 percent fraud penalty wasn’t warranted. Accordingly, the comptroller affirmed the assessments. [Tex. Comptroller of Pub. Accts., Comptroller’s Dec., Hearing Nos. 115,851, 115,852, Accession No. 202005034H, 05/29/20]

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