This course will lay out some of the important aspects of state income tax and sales tax nexus concerns, then address the importance of performing detailed state and local tax due diligence. It will also discuss the importance of performing due diligence to address the potential sins of the past before actually entering the M&A market.
This word file contain all information regarding taxation in india, income tax returns, types of income tax , direct tax, indirect tax, wealth tax, income tax ,excise duty , which helps you to gain knowledge about taxation in brief, and also helps you in making internship report on taxation or income tax.
This word file contain all information regarding taxation in india, income tax returns, types of income tax , direct tax, indirect tax, wealth tax, income tax ,excise duty , which helps you to gain knowledge about taxation in brief, and also helps you in making internship report on taxation or income tax.
Nonprofit accounting and IRS Form 990 overview. How non profit entities can account for revenue, expenses, contributions, unrelated business income, and balance sheet transactions. IRS requirements for tax-exempt organizations.
FACTORS AFFECTING TAX COMPLIANCE AMONG SMALL AND MEDIUM ENTERPRISES IN KITALE...paperpublications3
Abstract:This study seeks to establish factors affecting tax compliance by Small and Medium Enterprises, with special emphasis on Income Tax and Value Added Tax and their effects on government revenue. Tax compliance level which is internal factor affecting tax revenue not only undermines tax administration infrastructure but also makes the tax base narrow and inequitable. The objectives of the study include establishing the influence of compliance cost, fines and penalties and attitudes of tax compliance among Small and Medium Enterprises. The study adopts a descriptive research design involving both qualitative and quantitative research methodology. The target population was 200, out of which a sample size of 132 respondents were drawn, using stratified and simple random sampling. Questionnaires were used to collect primary data from the respondents, which were analyzed using SPSS applying both descriptive and inferential analysis. There was a positive relationship between the tax and compliance cost (r=.514), fines and penalties (r=.415) attitudes (r=.546) and tax compliance. The findings showed that compliance cost, fines and penalties and attitude had significant relationship with tax compliance. It is recommended that the tax system should provide a clear and simple guideline on how to fill tax returns but also enhance taxpayer education services to enable the taxpayers understand their rights and obligations as taxpayers, there should be moderate levels of fines and taxes so that SMEs are encouraged to comply since they will keep accurate records for taxation purposes in order to avoid fines and penalties.
Keywords: Direct tax, Indirect tax, Medium enterprise, Productive expenditure, tax evasion, tax impact.
State and Local Tax Nexus Issues and the Impact on Mergers and AcquisitionsSkoda Minotti
Would you sell a home before making it attractive enough to turn a profit? Selling a business is no different. Before you plan to sell, there are essential tax implications you should understand and steps you should take to ensure smooth sailing for a successful transaction
Wayfair and the Changing Sales Tax LandscapeSkoda Minotti
The recent Supreme Court decision in South Dakota v. Wayfair has far-reaching implications for sales tax collection in the U.S.
Join Skoda Minotti’s Mary Jo Dolson, CPA, for a webinar discussing this recent Supreme Court decision that overturned the long-standing physical presence standard established in Quill v. North Dakota and its potential impact on your business. We will discuss the current standard for sales tax nexus in various states, as well as what your business should be doing now to start collecting sales tax.
Nonprofit accounting and IRS Form 990 overview. How non profit entities can account for revenue, expenses, contributions, unrelated business income, and balance sheet transactions. IRS requirements for tax-exempt organizations.
FACTORS AFFECTING TAX COMPLIANCE AMONG SMALL AND MEDIUM ENTERPRISES IN KITALE...paperpublications3
Abstract:This study seeks to establish factors affecting tax compliance by Small and Medium Enterprises, with special emphasis on Income Tax and Value Added Tax and their effects on government revenue. Tax compliance level which is internal factor affecting tax revenue not only undermines tax administration infrastructure but also makes the tax base narrow and inequitable. The objectives of the study include establishing the influence of compliance cost, fines and penalties and attitudes of tax compliance among Small and Medium Enterprises. The study adopts a descriptive research design involving both qualitative and quantitative research methodology. The target population was 200, out of which a sample size of 132 respondents were drawn, using stratified and simple random sampling. Questionnaires were used to collect primary data from the respondents, which were analyzed using SPSS applying both descriptive and inferential analysis. There was a positive relationship between the tax and compliance cost (r=.514), fines and penalties (r=.415) attitudes (r=.546) and tax compliance. The findings showed that compliance cost, fines and penalties and attitude had significant relationship with tax compliance. It is recommended that the tax system should provide a clear and simple guideline on how to fill tax returns but also enhance taxpayer education services to enable the taxpayers understand their rights and obligations as taxpayers, there should be moderate levels of fines and taxes so that SMEs are encouraged to comply since they will keep accurate records for taxation purposes in order to avoid fines and penalties.
Keywords: Direct tax, Indirect tax, Medium enterprise, Productive expenditure, tax evasion, tax impact.
State and Local Tax Nexus Issues and the Impact on Mergers and AcquisitionsSkoda Minotti
Would you sell a home before making it attractive enough to turn a profit? Selling a business is no different. Before you plan to sell, there are essential tax implications you should understand and steps you should take to ensure smooth sailing for a successful transaction
Wayfair and the Changing Sales Tax LandscapeSkoda Minotti
The recent Supreme Court decision in South Dakota v. Wayfair has far-reaching implications for sales tax collection in the U.S.
Join Skoda Minotti’s Mary Jo Dolson, CPA, for a webinar discussing this recent Supreme Court decision that overturned the long-standing physical presence standard established in Quill v. North Dakota and its potential impact on your business. We will discuss the current standard for sales tax nexus in various states, as well as what your business should be doing now to start collecting sales tax.
On June 21st, the United States Supreme Court issued its long-awaited decision in South Dakota v. Wayfair, overturning the requirement that an out-of-state seller have physical presence in order for a state to require the seller to collect and remit state and local sales tax. Under Wayfair, substantial nexus exists if the taxpayer “avails itself of the substantial privilege of carrying on a business in that jurisdiction.”
Business Law Training | State and Local Taxes: Key Developments That Will Aff...Quarles & Brady
Most businesses pay more state and local taxes than federal. This program will update you on some of the key developments in the state and local tax world that will affect your companies now and in the future. Topics include how changes in federal law will affect state taxes, the ongoing debacle over sales tax collection requirements, an explanation of how states are fundamentally changing their corporate taxes, and much more.
California as a Backdrop for Recent State Tax DevelopmentsCBIZ, Inc.
recent California income and franchise tax developments and how those developments compare and contrast with income and franchise tax laws in other states.
[ON-DEMAND WEBINAR] Revealing The State & Local Tax Considerations Of A Remot...Rea & Associates
Tax Consequences Holding You Back From Deploying A Remote Workforce?
As remote work continues to overtake the traditional workforce, organizations must understand state and local tax considerations for their remote employees before adopting such a policy. Due to quick changes in the work environment and work-from-home arrangements many tax consequences that may result in your business reconsidering the deployment of a remote workforce. Fortunately, state and local tax leader and a principal with Rea & Associates, Kathy LaMonica, will be on hand to explain what businesses are up against. She will also be taking your questions throughout the presentation. Read on to discover what you will hear during this free, hour-long webinar.
State & Local Tax Guidance To Guide Your Remote Workforce Decision
Join Rea & Associates for a free, hour-long webinar to gain insight on tax law updates, remote work implications, what land mines you need to be aware of when registering for payroll taxes in new states, and more. During this event, you will:
- Gain insight on the Wayfair decision, and recent updates that may affect your business 3 years later.
- Take a deep dive into the State and Local direct and indirect tax concerns when hiring remote workers.
- Receive an update on Ohio Municipal Tax legal challenges.
- Tune in for predictions of where the states may be headed with the taxability of services and digital products, and how that may affect your compliance requirements.
- And more!
Kathy, an income principal on the firm's state and local tax team, focuses on sales and use tax consulting, compliance, and implementing technology solutions for businesses and organizations that continue to struggle with the various tax laws found throughout the nation. Since COVID-19 emerged and the topic of working remote took center stage, she has been tracking the implications associated with deploying a remote workforce. You won't want to miss this one!
#ReaCPA #State&LocalTax #RemoteEmployees
Testimony: Kansas Tax Modernization: A Framework for Stable, Fair, Pro-growth...Kevin Kaufman
Testimony to: Kansas’ Senate Committee on Assessment and Taxation; and Kansas’ House Committee on Taxation
Presenting: Kansas Tax Modernization: A Framework for Stable, Fair, Pro-growth Reform
US Sales Tax Guide - Understand How Sales Tax works in US Market
Sales tax in the United States is a consumption-based tax imposed on the sale of goods and certain services. It is levied by state governments, and in some cases, by local jurisdictions, making it a complex and multifaceted system. In this comprehensive guide, we will explore the key aspects of sales tax in the U.S., including its history, how it works, rates, exemptions, compliance, and challenges faced by businesses and consumers.
1.How Sales Tax Works:
2.State Sales Tax Rates:
3. Historical Background:
4.Local Sales Tax Rates:
Whether you manufacture pallets, you pivoted from your core product to produce PPE, or maybe you are a retailer who is looking for some great insight from industry experts or you have accounting or finance questions related to your construction business or any manner of business in between, we would be glad to have you join us.
The topics we will cover are not only relevant and timely, but they are also sure to reveal growth opportunities in your business. This special presentation features insight into the PPP Loan and Paycheck Protection Program Loan Forgiveness process, CARES Act implication, R&D opportunities, Human Resources compliance risks, and insight from leading professionals in the manufacturing and professional services space.
Specifically, we will discuss:
- Where we stand now and the future of manufacturing
- Risks in Manufacturing
- Cybersecurity Concerns and Issues
- State and Local Tax Risks
- HR Policies For Your Organization
This informative event will be hosted and moderated by Dustin Raber, director of manufacturing and distributions services at Rea & Associates.
eCommerce and US Sales Tax – why companies are automatingJanSobczak5
Sacha Wilson
Director, Tax Technology Solutions EMEA Avalara
If you sell to customers in the US, get prepared for the major tax changes taking effect across the United States. The Supreme Court ruling in South Dakota v. Wayfair Inc, is only the beginning of a wave of change impacting companies that sell crossborder in the US. Get the latest updates and learn how companies are turning to tax technology solutions in their ecommerce checkouts, billing systems and ERPs to automate compliance.
Sacha Wilson is Avalara’s Director, Tax Technology Solutions EMEA, whose team helps businesses of all size automate the complexities of global tax compliance. Sacha’s background in business development and ecommerce spans over 20 years and covers blue-chips such as Amazon and Arcelor-Mittal as well as several dotcom start-ups. During 11 years at Amazon he launched and grew a number of programmes including Amazon’s Marketplace, Fulfilment by Amazon, Amazon Pay and Product Ads. He brings a depth in understanding of ecommerce and the tax issues facing European businesses involved in global trade.
Smart Manufacturing Workshop: An Interactive Improv SessionSkoda Minotti
Learn how you can increase revenue, decrease costs and improve profitability all while improving your overall equipment effectiveness, quality, on-time delivery and much more!
Your business faces risks on multiple fronts, so risk management should be a strategic priority. Identifying and addressing risks helps your business run smoothly, and keeps you focused on pursuing your business objectives. We discuss strategies to mitigate your IT threats, explore insurance options and assess your internal control needs.
Navigating the Tax and Accounting Implications of CryptocurrenciesSkoda Minotti
Cryptocurrency is used all over the world, for all kinds of exchanges and transactions. It offers a host of benefits including:
- Secure transactions
- Privacy protection and business recognition
- Decentralization
- A faster, cheaper and frictionless alternative
According to some expert opinions, cryptocurrencies will eventually dominate as currencies of choice. As more and more business owners are taking steps to incorporate virtual currency into their business, they must be aware of and understand key tax and accounting issues that relate to cryptocurrency.
By providing regular feedback to your employees, you drive accountability and productivity within your business. This also is one of the largest predictors of employee engagement. A company without regular feedback loses the ability to make direct connections between employees and management. In addition, employees who achieve their goals and who are appropriately rewarded will continue to drive high performance. This session outlines the essentials of performance management and structuring rewards to best engage and motivate employees.
Non-Qualified Deferred Compensation Programs for Private CompaniesSkoda Minotti
Paying annual bonuses may not keep the executives around after the bonus is paid. Should executives be rewarded if the employer is not doing well? How can employers attract and retain key executives while creating a system that will reward them if the company is profitable?
This interactive session is designed for both novice and seasoned interviewers alike. During the course, you will explore the concepts of motivational fit and behavioral-based interviewing. We will also uncover common mistakes made by most interviewers and what questions are legal to ask a candidate.
Valuation Issues in Developing and Executing Buy-Sell AgreementsSkoda Minotti
A buy-sell agreement is one of the most common tools utilized by lawyers and business advisors in protecting their business owner clients. In this presentation, you will learn about valuation issues that are critical to buy-sell agreements, such as the use of formulas and valuation discounts, which can significantly impact the parties to the agreement if and when it is triggered.
ABC Presents: Recruiting and Retaining Top TalentSkoda Minotti
Businesses today are experiencing a workforce shortage that is crippling production and growth. Even more, our workforce has become increasingly disengaged as companies expand and diversify. Never before has it been so challenging to recruit, hire, develop and retain a skilled construction workforce. Estimates are that there will be a shortage of 1.4 million construction workers in the next 10 years. How can you build your company and its workforce? Heidi Hoyt, Skoda Minotti’s managing director of Staffing, shares views about staffing challenges and opportunities for organizations of every size and scope.
Future-Proofing Your Business with TechnologySkoda Minotti
Technology is rapidly moving from a business enabler to the core of the business. New technologies such as “big data” and analytics, the internet of things (IoT), robotics, mobile technology, artificial intelligence and cybersecurity are transforming the way business gets done.
We explore the business implications of technology and their impact on businesses of all sizes and scopes, and presents strategies for charting a path through these disruptive times.
Manufacturing in Northeast Ohio: Where We Stand, Where We’re HeadedSkoda Minotti
What are the concerns and challenges of manufacturing companies in Northeast Ohio? How do they perceive opportunities and issues confronting them in 2019? Where are they allocating time, money and resources, and what is their rationale?
Today’s job seekers think and act differently. Attracting and retaining top talent takes a mix of new-school technology and old-school sensibility. The good news: Developing a sound strategy is well within your reach.
Stacy Bauer, Co-Founder of BauerGriffith, LLC, Heidi Hoyt, Skoda Minotti's Managing Director of Staffing, and Laura Rohde, Skoda Minotti's Managing Director of HR Services, share their views about staffing challenges and opportunities for organizations of every size and scope.
New Ohio Cybersecurity Law RequirementsSkoda Minotti
Skoda Minotti’s Risk Advisory Services Group and Insurance Services Group are working closely with insurance industry licensees to meet the considerable requirements under the Ohio cybersecurity law. This presentation provides more detailed information about the law, and assists you with your understanding and implementation of the requirements.
Five Digital Marketing Trends Your Company Needs to Know in 2019Skoda Minotti
With the digital marketing landscape continually evolving, it’s difficult to know which trends will make the most meaningful impact on your business. Bob Goricki, Skoda Minotti’s Director of Digital Marketing, discusses five key trends that are shaping marketing technology, social media advertising, marketing automation, General Data Protection Regulation (GDPR) and search engine optimization in 2019.
This course will take you through the process of a typical business valuation engagement, from scoping the work to ultimately arriving at a conclusion of value. Through a case study, we will address fundamental issues including valuation approaches (asset, income and market), normalizing analysis and valuation discounts.
This presentation will examine how to get the most out of using a forensic accounting expert, as well as tips for qualifying the proper expert. In addition, we will review the accounting standards most commonly questioned by lawyers in forensic accounting cases, as well as Daubert challenges. This program also covers effective engagement management methodologies, forensic approaches, expert report preparation, expert comparisons, testifying, the art of conveying clear expert conclusions and of course, "expert vulnerabilities."
Military Commissions details LtCol Thomas Jasper as Detailed Defense CounselThomas (Tom) Jasper
Military Commissions Trial Judiciary, Guantanamo Bay, Cuba. Notice of the Chief Defense Counsel's detailing of LtCol Thomas F. Jasper, Jr. USMC, as Detailed Defense Counsel for Abd Al Hadi Al-Iraqi on 6 August 2014 in the case of United States v. Hadi al Iraqi (10026)
In 2020, the Ministry of Home Affairs established a committee led by Prof. (Dr.) Ranbir Singh, former Vice Chancellor of National Law University (NLU), Delhi. This committee was tasked with reviewing the three codes of criminal law. The primary objective of the committee was to propose comprehensive reforms to the country’s criminal laws in a manner that is both principled and effective.
The committee’s focus was on ensuring the safety and security of individuals, communities, and the nation as a whole. Throughout its deliberations, the committee aimed to uphold constitutional values such as justice, dignity, and the intrinsic value of each individual. Their goal was to recommend amendments to the criminal laws that align with these values and priorities.
Subsequently, in February, the committee successfully submitted its recommendations regarding amendments to the criminal law. These recommendations are intended to serve as a foundation for enhancing the current legal framework, promoting safety and security, and upholding the constitutional principles of justice, dignity, and the inherent worth of every individual.
Car Accident Injury Do I Have a Case....Knowyourright
Every year, thousands of Minnesotans are injured in car accidents. These injuries can be severe – even life-changing. Under Minnesota law, you can pursue compensation through a personal injury lawsuit.
Responsibilities of the office bearers while registering multi-state cooperat...Finlaw Consultancy Pvt Ltd
Introduction-
The process of register multi-state cooperative society in India is governed by the Multi-State Co-operative Societies Act, 2002. This process requires the office bearers to undertake several crucial responsibilities to ensure compliance with legal and regulatory frameworks. The key office bearers typically include the President, Secretary, and Treasurer, along with other elected members of the managing committee. Their responsibilities encompass administrative, legal, and financial duties essential for the successful registration and operation of the society.
A "File Trademark" is a legal term referring to the registration of a unique symbol, logo, or name used to identify and distinguish products or services. This process provides legal protection, granting exclusive rights to the trademark owner, and helps prevent unauthorized use by competitors.
Visit Now: https://www.tumblr.com/trademark-quick/751620857551634432/ensure-legal-protection-file-your-trademark-with?source=share
PRECEDENT AS A SOURCE OF LAW (SAIF JAVED).pptxOmGod1
Precedent, or stare decisis, is a cornerstone of common law systems where past judicial decisions guide future cases, ensuring consistency and predictability in the legal system. Binding precedents from higher courts must be followed by lower courts, while persuasive precedents may influence but are not obligatory. This principle promotes fairness and efficiency, allowing for the evolution of the law as higher courts can overrule outdated decisions. Despite criticisms of rigidity and complexity, precedent ensures similar cases are treated alike, balancing stability with flexibility in judicial decision-making.
Introducing New Government Regulation on Toll Road.pdfAHRP Law Firm
For nearly two decades, Government Regulation Number 15 of 2005 on Toll Roads ("GR No. 15/2005") has served as the cornerstone of toll road legislation. However, with the emergence of various new developments and legal requirements, the Government has enacted Government Regulation Number 23 of 2024 on Toll Roads to replace GR No. 15/2005. This new regulation introduces several provisions impacting toll business entities and toll road users. Find out more out insights about this topic in our Legal Brief publication.
WINDING UP of COMPANY, Modes of DissolutionKHURRAMWALI
Winding up, also known as liquidation, refers to the legal and financial process of dissolving a company. It involves ceasing operations, selling assets, settling debts, and ultimately removing the company from the official business registry.
Here's a breakdown of the key aspects of winding up:
Reasons for Winding Up:
Insolvency: This is the most common reason, where the company cannot pay its debts. Creditors may initiate a compulsory winding up to recover their dues.
Voluntary Closure: The owners may decide to close the company due to reasons like reaching business goals, facing losses, or merging with another company.
Deadlock: If shareholders or directors cannot agree on how to run the company, a court may order a winding up.
Types of Winding Up:
Voluntary Winding Up: This is initiated by the company's shareholders through a resolution passed by a majority vote. There are two main types:
Members' Voluntary Winding Up: The company is solvent (has enough assets to pay off its debts) and shareholders will receive any remaining assets after debts are settled.
Creditors' Voluntary Winding Up: The company is insolvent and creditors will be prioritized in receiving payment from the sale of assets.
Compulsory Winding Up: This is initiated by a court order, typically at the request of creditors, government agencies, or even by the company itself if it's insolvent.
Process of Winding Up:
Appointment of Liquidator: A qualified professional is appointed to oversee the winding-up process. They are responsible for selling assets, paying off debts, and distributing any remaining funds.
Cease Trading: The company stops its regular business operations.
Notification of Creditors: Creditors are informed about the winding up and invited to submit their claims.
Sale of Assets: The company's assets are sold to generate cash to pay off creditors.
Payment of Debts: Creditors are paid according to a set order of priority, with secured creditors receiving payment before unsecured creditors.
Distribution to Shareholders: If there are any remaining funds after all debts are settled, they are distributed to shareholders according to their ownership stake.
Dissolution: Once all claims are settled and distributions made, the company is officially dissolved and removed from the business register.
Impact of Winding Up:
Employees: Employees will likely lose their jobs during the winding-up process.
Creditors: Creditors may not recover their debts in full, especially if the company is insolvent.
Shareholders: Shareholders may not receive any payout if the company's debts exceed its assets.
Winding up is a complex legal and financial process that can have significant consequences for all parties involved. It's important to seek professional legal and financial advice when considering winding up a company.
ALL EYES ON RAFAH BUT WHY Explain more.pdf46adnanshahzad
All eyes on Rafah: But why?. The Rafah border crossing, a crucial point between Egypt and the Gaza Strip, often finds itself at the center of global attention. As we explore the significance of Rafah, we’ll uncover why all eyes are on Rafah and the complexities surrounding this pivotal region.
INTRODUCTION
What makes Rafah so significant that it captures global attention? The phrase ‘All eyes are on Rafah’ resonates not just with those in the region but with people worldwide who recognize its strategic, humanitarian, and political importance. In this guide, we will delve into the factors that make Rafah a focal point for international interest, examining its historical context, humanitarian challenges, and political dimensions.
Debt Mapping Camp bebas riba to know how much our debt
The Importance of State and Local Tax Nexus
1. State and Local Tax Nexus
Issues and the Impact on
Mergers and Acquisitions
Mary Jo Dolson, CPA
January 17, 2019
2. 2
State and Local Tax
• State and Local Income Tax Nexus Issues/Concerns
• State and Local Sales/Use Tax Nexus in Light of Wayfair
• Importance of State and Local Tax Issues in Relation to
Mergers and Acquisitions
• Conclusion
3. 3
State and Local Tax
Importance of State and Local Taxes
• As states continue to rebound from the recession, they
look to different means to raise revenue
• States are expanding their discovery of efforts to pull in
more taxpayers
States more aggressive in sending out nexus questionnaires
Conducting audits of out-of-state businesses operating in state
4. 4
Nexus: What Is It?
The connection between a taxpayer and a taxing jurisdiction
that is constitutionally and statutorily sufficient enough for the
taxing jurisdiction to impose a tax.
5. 5
Nexus
Nexus standards are different for state income tax and sales
tax:
• State income tax – public law protection
• Sales tax – no public law protection
6. 6
State Income Tax Nexus
Complete Auto Transit
• The Supreme Court developed a four-prong test to
determine if a state can impose a state income tax:
For a tax to be viewed as constitutional the tax is applied to an
activity with substantial nexus
Must be fairly apportioned
Doesn’t discriminate against interstate commerce
Fairly related to the services provided by the state
7. 7
Nexus: How to Determine
• Each state has its own nexus standards
• Common measures for nexus:
Physical presence
Remote employees
Mobile employees
Employee activity
Registered to do business
Economic threshold standards
Affiliated nexus
8. 8
Nexus: How to Determine
• Physical presence:
Property
Payroll
Inventory – consigned
Inventory at manufacturers
Inventory at printers
9. 9
Nexus: How to Determine
• Remote employees
Temporarily located outside state
Permanently located outside state
• Mobile employees
Traveling for different projects
10. 10
Nexus: How to Determine
• Affiliated nexus
Nexus position new to states
11. 11
State Income Tax Nexus
• Public Law 86-272 protection
Tangible personal property
Services
• Operations in the state
• Assets located in the state
• Employees traveling into state
• Economic nexus
Set amount of property, payroll and sales in the state
‒ Generally enacted by statute
12. 12
Public Law 86-272
• Federal public law to protect certain activities against
income tax across state lines
• Protected activities:
Solicitation of sales of tangible personal property
Services that are ancillary to solicitation of sales
De Minimis activities as compared to protected activities
• Exempts entities from net income tax
Does not exempt entity from sales tax, franchise tax, gross receipts
tax, minimum taxes, etc.
13. 13
Public Law 86-272
• Need to look to what activities are being performed by
employees to determine if protected by Public Law
• Each state might have its own take on protected and
unprotected activities for employees
14. 14
Public Law 86-272
• Can a taxpayer still claim Public Law protection if taxpayer
exceeds an economic nexus threshold?
• What if taxpayer is providing a service in the state – is
there Public Law protection?
• What if a taxpayer has inventory located in a state – can
they claim Public Law protection?
15. 15
Public Law Example
Company B sells computer systems to customers in New
York. It has no property or full-time employees in New York.
At the request of its customers, a part of the sale price of the
system includes installation. Now sales staff must install and
service the computer systems as a part of their job.
Does Company B fall under Public Law protection?
16. 16
Public Law Exemption
Company B sells computer systems to customers in New
York. It has no property or full-time employees in New York.
At the request of its customers a part of the sale price of the
system includes installation. Now sales staff must install and
service the computer systems as a part of their job.
Does Company B fall under Public Law protection?
• No
17. 17
Public Law Protection
Does Public Law 86-272 apply to the performance of a
service?
• What if performing a mixture of service and sale of
product?
• What if in the state one year and no activity the next year?
18. 18
Sales Tax Nexus
• No Public Law protection
• Has been turned upside down this year
• Physical presence
• Economic nexus threshold
19. 19
Wayfair Decision
Physical Presence Standard
• National Belles Hess
First case addressing physical presence standard
Decided during the 1960s
• Quill v. North Dakota
Case most referred to when discussing physical presence for sales
tax
Decided early 1990s
20. 20
Wayfair Decision
Direct Marketing
• Case decided by the Supreme Court in 2015
• In deciding the case, Justice Kennedy’s concurring opinion
indicated that the states should find a case for the court to
reexamine Quill
• The states started plotting just such a case
21. 21
Wayfair Decision
South Dakota
• March 2016 – South Dakota enacted the “economic
nexus” standard that the Supreme Court examined in
Wayfair
The standard is $100,000 in South Dakota sales or 200
transactions.
• South Dakota went after Wayfair, Overstock and NewEgg
for now complying with the new “economic nexus”
standard
• Unique about South Dakota – the way the court system
works a case can quickly work its way through the South
Dakota system and get to the Supreme Court
22. 22
Wayfair Decision
South Dakota’s Arguments:
• States, local brick-and-mortar stores and interstate
commerce are harmed (i.e., lost revenue)
• Brick-and-mortar stores are discriminated against (i.e.,
higher price than online retailers)
• The physical presence standard is obsolete in the internet
economy
• There is little burden on vendors
23. 23
Wayfair Decision
Wayfair’s Arguments:
• States receive 75% – 80% of all remote sales tax, and
uncollected amount is declining;
19 of top 20 internet retailers collect tax on most or all states
• Overturning Quill would be a huge burden on businesses
• Retroactive liability would be crippling
• States need to simplify before Quill is reexamined or
overturned
SSUTA: 23 signatory states but only 1/3 of population
24. 24
Wayfair Decision
Supreme Court Action:
• Granted cert January 2018
• Oral arguments heard April 17, 2018
• Decision rendered June 21, 2018
• The decision went 5-4 in favor of South Dakota
“Isn’t the problem not Quill, but the fact that you don’t have a
mechanism to collect from consumers?”
Justice Sotomayor
In dissenting opinion, Justice Roberts indicated “Yes, we got Quill
wrong, but it is up to Congress to enact a fix to the physical nexus
standard.”
25. 25
Wayfair Decision
Supreme Court Action:
• Decided South Dakota’s “economic nexus” standard was
sufficient.
Prior to Wayfair, business was required to have a physical
presence
‒ Employee
‒ Employee visits
‒ Attend trade shows
‒ Property and/or inventory in state
Post Wayfair “economic nexus”
‒ Sufficient amount of sales or
‒ Number of transactions
26. 26
Wayfair Decision
What Happens Now:
• South Dakota case was remanded to South Dakota
Supreme Court
• Numerous state have similar “economic nexus’ standards
in place – $100,000 in sales or 200 transactions
• The question is, “Where do we go from here?”
Are the changes retroactive?
What about use tax reporting?
Will Congress do anything?
27. 27
Wayfair Decision
• Numerous states already have an “economic nexus” standard
as part of their state statute
• Some states enacted before South Dakota and some since
anticipating the Supreme Court decision
• Questions that need to be addressed:
If part of state statute prior to Wayfair, how will the states handle
prospective or retroactively?
How do you determine sales for the economic nexus standard?
What is meant by a transaction?
– Entire invoice or each line item?
– Is it taxable sales or all sales?
– What if everything I sell is exempt?
28. 28
Wayfair Decision
Prospective or Retroactive Treatment
• State’s submitted briefs during the Wayfair case indicating
they would enforce prospectively
• Supreme Court in rendering its decision noted South
Dakota’s prospective treatment
29. 29
Wayfair Decision
Economic Nexus Threshold
• South Dakota’s is $100,000 in sales or 200 transactions
• The majority of the states with an economic nexus
standard have a similar or higher standard
• It is believed the standards would hold up and can be
enforced
• States are moving forward with enforcement
• We are still awaiting guidance on effective dates
30. 30
Wayfair Decision
Economic Nexus Threshold
• What is meant by sales?
$100,000 in sales or $250,000 in sales
– This is all sales into a particular state
– States are utilizing the following standards:
• Previous calendar year
• Current calendar year
• Rolling 12 months
31. 31
Wayfair Decision
Economic Nexus Threshold
• What is meant by transactions?
Commonly it is 200 transactions
– Generally this is all transactions into a state
– It is generally not line items on an invoice, but the entire invoice counts
as one transaction
– Does not matter if the transaction is taxable or non-taxable
32. 32
Wayfair Decision
Economic Nexus Threshold
• States currently with an economic nexus standard:
AL, CT, GA, HI, IL, IN, IA, KY, LA, ME, MA, MI, MN, MS, NJ, NM,
ND, OH, OK, PA, RI, SD, TN, VT, WA, WI, WY
33. 33
Wayfair Decision
Impact to Businesses:
• Online retailers
• Manufacturers
• Service provider
• International businesses
35. 35
Wayfair Decision
Other Concerns
• State Income Tax Nexus
Will more states adopt economic nexus standards?
Will states try and stretch standards already in place?
36. 36
State Tax and Due Diligence
• State tax issues increasingly more important
• Many aspects need to be examined:
State income tax
Sales tax
Payroll
Personal property
Unclaimed funds
Casual sales issues
Pre due diligence
37. 37
State Tax and Due Diligence
State Income Tax
• Nexus concerns
• State income tax returns
• Apportionment information
• Cost of performance / market-based sales
• Audit results
• State tax issues increasingly more important
• Tax clearances
• Required registrations
38. 38
State Tax and Due Diligence
Sales/Use Tax
• Nexus concerns
• Sales/use tax returns
• Use tax filings
• Audit results
• Exemption certificates
• Casual sales / bulk sale exemption
• Audit results
• Tax clearances
• Asset purchase / entity purchase
• Required registrations
39. 39
State Tax and Due Diligence
Payroll
• Withholding returns
• Filing properly
• Required reporting forms
• Audit results
• Tax clearances
• Registration requirements
40. 40
State Tax and Due Diligence
Personal Property Tax
• Review of returns
• Assets being properly reported
• Requirements after deal
• Accounts
41. 41
State Tax and Due Diligence
Unclaimed Funds
• Are returns being filed?
• Is there an exposure for unreported funds?
• Any procedures to determine if unreported funds?
• Procedures if funds discovered?
42. 42
State Tax and Due Diligence
Pre-Due Diligence
• Get the house in order before the sale
• Review all filings
• Enter into VDAs to fix issues
• Help reduce due diligence in future
43. 43
Conclusion
• State Income Tax Nexus
Public Law Protection
Physical Presence – Economic Nexus
• Sales/Use Tax Nexus
Wayfair Impact
Compliance Issues
• Due Diligence
Pre-Due Diligence Review
Cautious Even With Asset Sale
44. 44
Contact Us
Mary Jo Dolson, CPA
Partner
Phone – (813) 386-3881
Mobile – (216) 316-8070
Email – mdolson@skodaminotti.com