by
At issue was the meaning of the term “day” as used in Ariz. Rev. Stat. 28-8336, which establishes a license tax for “a nonresident whose aircraft is based in this state for more than ninety days but less than two hundred ten days in a calendar year.” The court of appeals determined that “day” means “any calendar day during which the aircraft was on the ground in Arizona for any period of time.” The Supreme Court reversed and remanded the case to the tax court of further proceedings, holding (1) the meaning of “day” can ultimately be construed only in the context of the days an aircraft is “based in” the state; and (2) because the parties did not fully address, nor did the tax court decide, the meaning of the term “based in,” the issue cannot be fully resolved on the current record. View "BSI Holdings LLC v. Arizona Department of Transportation" on Justia Law

by
In 2011, Dr. Parmar died, leaving an estate valued at more than $5 million. Plaintiff was appointed as executor of the estate. At the time of Parmar’s death, the estate was not subject to taxation under the Estate Tax Act, 35 ILCS 405/1. Two days after Parmar’s death, the state revived the tax for the estates of persons who died after December 31, 2010. Plaintiff filed the estate’s Illinois estate tax return and paid the tax liability. Plaintiff eventually filed a second amended return, claiming that the amendment to the Estate Tax Act did not apply to his mother’s estate and no tax was due, then filed a purported class action challenging the retroactivity and constitutionality of the Act. Plaintiff requested a declaration that the Estate Tax Act applies only to the estates of persons who died on or after the amendment’s effective date or that the Estate Tax Act is unconstitutional. The Illinois Supreme Court upheld the suit’s dismissal for lack of jurisdiction; because the complaint seeks a money judgment against the state, it is barred under the State Lawsuit Immunity Act (745 ILCS 5/1). The complaint must be filed in the Illinois Court of Claims. The damages that plaintiff seeks go beyond the exclusive purpose and limits of the Estate Tax Refund Fund and potentially subject the state to liability. Plaintiff could have filed suit in the circuit court under the Protest Moneys Act (30 ILCS 230/1). View "Parmar v. Madigan" on Justia Law

by
The Supreme Court affirmed an Administrative Hearing Commission (Commission) decision allowing the director of revenue to redistribute tax revenue owed to the City of Lee’s Summit but erroneously paid to Cass County. Cass County sought a writ prohibiting the director of revenue from withholding the tax revenue and redistributing it to Lee’s Summit, arguing that the director lacked the authority to undertake such an action because this was a refund matter and no application for a refund was filed. The court of appeals ruled that a writ was inappropriate because the County had an adequate remedy by appeal to the Commission. On appeal to commission, the County was denied relief. The Supreme Court affirmed, holding that this was not a refund matter contemplated by Mo. Rev. Stat. 144.190.2, and accordingly, the County failed to demonstrate that the Commission's decision was not authorized by law. View "Cass County, Missouri, v. Director of Revenue" on Justia Law

by
The DC Circuit affirmed the Tax Court's holding that Mellow was subject to the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA), 26 U.S.C. 6221–6234 (2012), proceedings. The court held that the record made clear that Mellow's partners were the single-member LLCs, not their individual owners; the court deferred to the IRS's reasonable interpretation of its own regulation that a partnership with pass-thru partners was ineligible for the small-partnership exception and that single-member LLCs constitute pass-thru partners; and the court lacked jurisdiction over Mellow's challenge to the penalties because Mellow failed to raise its claim and waived its claim by consenting to a decision applying penalties. View "Mellow Partners v. Commissioner of Internal Revenue Service" on Justia Law

by
In this real-property-valuation case, the Supreme Court vacated the decision of the Board of Tax Appeals (BTA) finding that the appraisal report presented by the Washington County Board of Revision and Washington County auditor (collectively, the County) constituted the most competent and probative evidence of the value of the subject property for tax year 2013. The BTA relied on the County’s report to value a property owned by Lowe’s Home Centers, Inc./Lowe’s Home Centers, LLC (collectively, Lowe’s), even though Lowe’s presented its own appraisal report. The Supreme Court vacated the BTA’s decision, holding (1) the Court’s decisions in Steak ’N Shake, Inc. v. Warrant County Board of Revision, 48 N.E.3d 535 (Ohio 2015), Rite Aid of Ohio, Inc. v. Washington County Board of Revision, 54 N.E.3d 1177 (Ohio 2016), and Lowe’s Home Centers, Inc. v. Washington County Board of Revision, 49 N.E.3d 1266 (Ohio 2016), provide the proper guideposts for resolving this controversy; and (2) because the BTA had yet to evaluate the evidence in light of the legal standards articulated in these three decisions, the case must be remanded for further proceedings. View "Lowe's Home Centers, Inc. v. Washington County Board of Revision" on Justia Law

by
In 2011, the City of Aspen adopted an ordinance which imposed a regulatory scheme designed to meet the city council’s “duty to protect the natural environment and the health of its citizens and visitors.” Under the ordinance, grocery stores within Aspen’s city limits were prohibited from providing disposable plastic bags to customers, though they could still provide paper bags to customers, but each bag is subject to a $0.20 “waste reduction fee,” unless the customer was a participant in a “Colorado Food Assistance Program.” This case presented the question of whether Aspen’s $0.20 paper bag charge was a tax subject to voter approval under the Taxpayer’s Bill of Rights (“TABOR”). The trial court held that this charge was not subject to TABOR because it was not a tax, but a fee. The court of appeals concurred with this holding. The Colorado Supreme Court also agreed, finding the bag charge was not a tax subject to TABOR. View "Colorado Union of Taxpayers Found. v City of Aspen" on Justia Law

by
Hawaii’s use tax, Haw. Rev. Stat. 238-2, does not violate the Commerce Clause of the United States Constitution notwithstanding that the 2004 amendment to the statute eliminated the application of the tax to in-state unlicensed sellers. CompUSA Stores, L.P. filed claims for refund of its 2006, 2007, and 2008 use tax payments. The Department of Taxation (Department) denied the request. CompUSA appealed, arguing that the tax discriminates against out-of-state commerce, cannot be justified by a legitimate local purpose, and thus violates the Commerce Clause and the Equal Protection Clause. The Tax Appeals Court granted the Department’s motion for summary judgment. The Supreme Court affirmed, holding (1) the current version of the use statute establishes a classification between in-state and out-of-state sellers; but (2) the statute satisfies rational basis review because the classification of out-of-state sellers bears a rational relationship to the legitimate state interest of leveling the economic playing field for local businesses subject to the general excise tax. View "CompUSA Stores, L.P. v. State" on Justia Law

by
SW 98/99, LLC (“SW”), appealed a Pike County Chancery Court order dismissing its complaint with prejudice under Mississippi Rule of Civil Procedure 41(b). SW filed objections to the tax assessments for the years 2005 and 2006 for several low-income housing properties, but those objections were denied. SW then filed a complaint at Chancery Court alleging that Pike County, the Pike County Board of Supervisors, and the Pike County Tax Assessor (collectively “the defendants”) had wrongfully and excessively assessed taxes on SW’s properties using an appraisal method not authorized by Section 27-35-50(4)(d). Along with SW’s chancery-court lawsuit, SW also appealed the property-tax assessments to the Pike County Circuit Court. This case and SW’s tax appeals proceeded separately along their own paths until March 2011, when the chancellor entered an order granting the defendants’ motion to stay the proceedings in this case pending final resolution of SW’s circuit-court tax appeals. By 2015, the Pike County Circuit Court granted summary judgment to SW on each of its tax appeals, ordering the defendants to refund SW’s overpayments for the years 2005 through 2012. The defendants moved for reconsideration. While this matter was still pending, SW’s attorney was concurrently involved in an unrelated case in federal district court. The district court contacted SW’s attorney to inquire as to his availability for a trial beginning September 14, 2015, one day before the trial setting in this tax assessment case. Because the circuit court had not yet ruled on the defendants’ motion for reconsideration in SW’s tax appeals, SW’s attorney believed that the chancellor’s stay of proceedings in this case remained in effect, as the circuit-court proceedings were not “finally resolved.” Because of this, SW’s attorney contacted the chancery court to request that the trial date be continued and removed from the trial docket. Although later disputed by the court administrator, SW’s attorney believed at this time that the case had been continued and that the trial setting had been removed from the docket. SW’s attorney then informed counsel for the defendants of the continuance. The defendants did not object to the continuance. The chancellor entered a show-cause order noting that SW had not appeared at its scheduled motions hearing and that neither of the parties had appeared on the scheduled trial date. The order acknowledged that “some telephonic communication was made by a staff member of Counsel to the Court Administrator regarding the prior Order staying this litigation.” The chancellor’s show-cause order concluded that SW’s lawsuit was “stale and in a posture to be dismissed for lack of prosecution inasmuch as Counsel set aside two full trial days on a heavily congested trial docket and failed to appear for trial.” Finding that the chancery court abused its discretion in ruling that SW had failed to prosecute its complaint, the Mississippi Supreme Court reversed the chancery court’s judgment and remanded this case to the chancery court for further proceedings. View "SW 98/99, LLC v. Pike County, Mississippi" on Justia Law

by
The Eighth Circuit affirmed the tax court's order finding that taxpayer owed additional income taxes and penalties. The court held that the person that issued the notice of deficiency was in a supervisory position and thus the notice satisfied the statutory requirement that the deficiency be determined and sent by someone duly authorized by the Secretary of the Treasury. View "Muncy v. CIR" on Justia Law

by
The Supreme Court affirmed the decision of the Board of Tax Appeals (BTA) following the Court’s remand in Navistar I, holding that the BTA acted reasonably and lawfully in upholding the tax commissioner’s reduction of Navistar Inc.’s commercial-activity-tax (CAT) credit to zero. In Navistar I, the Supreme Court concluded that the BTA had ignored the testimony of Navistar’s experts in upholding the commissioner’s reduction of Navistar’s CAT credit to zero, an omission that made the BTA’s decision unreasonable and unlawful. After the BTA again upheld the tax commissioner’s decision, Navistar appealed, objecting to the BTA’s findings and its conclusion. The Supreme Court affirmed, holding that the BTA’s findings were supported by reliable and probative evidence and that the BTA’s conclusion was reasonable and lawful. View "Navistar, Inc. v. Testa" on Justia Law