Regency Transportation, Inc. is a Massachusetts S corporation that carries and delivers goods throughout the eastern United States. In 2010, the Commissioner of Revenue imposed a use tax on the full purchase price of each tractor and trailer in Regency’s fleet. The Commissioner subsequently denied Regency’s request for full abatement of the assessment. Regency appealed, arguing that the Commonwealth’s imposition of a use tax on vehicles engaged in interstate commerce violates the commerce and equal protection clauses of the Federal and State Constitutions. The Appellate Tax Board concluded that the motor vehicle use tax does not violate either the commerce or equal protection clauses. The Supreme Judicial Court affirmed, holding that an unapportioned use tax imposed on Regency’s interstate fleet of vehicles does not violate the commerce clause of the Federal Constitution. View "Regency Transp., Inc. v. Comm’r of Revenue" on Justia Law

The County appealed the trial court's judgment in favor of JCC on its property tax refund action based on the welfare exemption in Revenue and Taxation Code section 214, contending that the trial court erred by not deferring to an advisory rule of the SBE. The SBE interpreted section 214 to mean that both the owner and third party operator of a property used for charitable purposes must file claims for welfare exemptions. The court concluded that, while the statutory and regulatory scheme required JCC to file a claim for a welfare exemption as well as a claim for an organizational clearance certificate, it imposed no other conditions. Therefore, the SBE’s interpretation of section 214 was clearly erroneous. The court also concluded that the SBE’s advisory rule regarding who must file a welfare exemption is not binding and should not be given independent legal effect. The court further concluded that the County failed to establish that the trial court should have denied a tax refund because JCC’s claims were tardy and its claim forms were incomplete. Accordingly, the court affirmed the judgment. View "Jewish Community Ctrs. Dev. Corp. v. County of Los Angeles" on Justia Law

In 1974, the state of California joined the Multistate Tax Compact, which contained an apportionment formula and permitted a taxpayer election between the Compact’s formula and any other formula provided by state law. In 1993, the Legislature adopted a different apportionment formula by amending the Revenue and Taxation Code to provide that, notwithstanding the Compact’s provisions, the new apportionment formula “shall” apply. Between 1993 and 2005, six multistate corporations (Taxpayers) paid income tax calculated under the new formula but then sought a refund, contending that they remained entitled to elect between the new statutory formula and that contained in the Compact. The trial court concluded that the Legislature could, consistent with the Compact, eliminate the election provision. The court of appeal reversed. The Supreme Court reversed, holding that the Legislature may properly preclude a taxpayer from relying on the Compact’s election provision. View "Gillette Co. v. Franchise Tax Bd." on Justia Law

In 2010, the Talawanda City School District Board of Education (BOE) filed its application to exempt property located within the district. The tax commissioner granted an exemption for all of the property except for a parcel being farmed pursuant to lease, concluding that the pecuniary benefit realized by the farmer disqualified the land from exemption because that portion was not used for school purposes. The Board of Tax Appeals affirmed. the Supreme Court reversed, holding (1) following its amendment in 2010, Ohio Rev. Code 3313.44 does not contain a restriction requiring that the property owned by the BOE be used exclusively for school purposes; and (2) the entire property described in the BOE’s application shall be exempt for the year at issue. View "Talawanda City Sch. Dist. Bd. of Educ. v. Testa" on Justia Law

St. Peter’s, a non-profit healthcare entity, runs a hospital, and employs over 2,800 people. It is not a church, but has ties to a New Jersey Roman Catholic Diocese. The Bishop appoints most members of its Board of Governors and retains veto authority over Board actions. The hospital has daily Mass and Catholic devotional pictures and statues throughout the building. In 1974, St. Peter’s established a non-contributory defined benefit retirement plan; operated the plan subject to the Employee Retirement Income Security Act (ERISA); and represented that it was complying with ERISA. In 2006 St. Peter’s filed an IRS application, seeking a church plan exemption from ERISA, 26 U.S.C. 414(e); 29 U.S.C. 1002(33), continuing to pay ERISA-mandated insurance premiums while the application was pending. In 2013, Kaplan, who worked for St. Peter’s until 1999, filed a putative class action alleging that St. Peter’s did not provide ERISA-compliant summary plan descriptions or pension benefits statements, and that, as of 2011, the plan was underfunded by more than $70 million. While the lawsuit was pending, St. Peter’s received an IRS private letter ruling. affirming the plan’s status as an exempt church plan for tax purposes. The Third Circuit affirmed denial of a motion to dismiss, concluding that St. Peter’s could not establish an exempt church plan because it is not a church. View "Kaplan v. Saint Peter's Healthcare Sys." on Justia Law

At issue in this appeal was a 2010 assessment of personal property issued by the Pike County auditor against Lockheed Martin Energy Systems, Inc. (LMES) for tax year 1993. The tax commissioner canceled the assessment. LMES prevailed before the Board of Tax Appeals (BTA) on appeal. LMES prosecuted its appeal to the Supreme Court based on the BTA’s failure to address its contentions that the auditor issued the assessment frivolously and in bad faith. The county auditor cross-appealed. The Supreme Court affirmed, holding (1) the BTA lacked the authority to make a finding of frivolous conduct or bad faith on the auditor’s part; (2) LMES had standing as an aggrieved party to prosecute its appeal to the Supreme Court; and (3) the tax commissioner properly canceled the assessment, as affirmed by the BTA, because LMES was never shown to qualify as a “taxpayer” as that term is statutorily defined for purposes of the personal property tax. View "Snodgrass v. Testa" on Justia Law

The Alameda County Waste Management Authority imposed a $9.55 annual charge on all households for disposal of household hazardous waste, by enactment of an ordinance entitled “An Ordinance Establishing a Household Hazardous Waste Collection and Disposal Fee.” Crawley challenged the Ordinance via a petition for a writ of mandate or administrative mandamus, arguing that the fee constituted an assessment under article XIII D of the California Constitution, requiring approval by a majority of the electorate pursuant to section 4. In the alternative, Crawley contended the fee was not imposed in compliance with the requirements of article XIII D, section 6. The court of appeal affirmed dismissal without leave to amend, rejecting Crawley’s assertion that the fee is not incidental to property ownership and concluding that the fee falls within an exemption to the constitutional requirements. View "Crawley v. Alameda Cnty, Waste Mgmt. Auth." on Justia Law

Appellant Lower Merion Township was a township of the first class. Article IV of its municipal code required every person engaging in a business, trade, occupation, or profession in the Township to pay an annual business privilege tax calculated as a percentage of gross receipts. Appellees Fish, Hrabrick, and Briskin (“Lessors”) each own one or more parcels of real estate in the Township that they rent to tenants pursuant to lease agreements. The Township notified Lessors that, for every such parcel, they were obligated to purchase a separate business registration certificate and pay the business privilege tax based on all rental proceeds. Lessors sought a declaratory judgment stating that, pursuant to the Local Tax Enabling Act (the “LTEA”), the Township’s business privilege tax could not be applied to rental proceeds from leases and lease transactions. Lessors did not challenge the validity of Article IV generally. Rather, they observed that the LTEA’s general grant of power in this regard is subject to an exception stating that such local authorities lack the ability to “levy, assess, or collect . . . any tax on . . . leases or lease transactions[.]” Lessors argued their real property rental activities fell within the scope of this exception. The trial court granted the Township's motion, denied the Lessors' motion and dismissed the complaint. A divided Commonwealth Court reversed, but the Supreme Court agreed with the trial court's judgment, reversed the Commonwealth Court and reinstated the trial court's order dismissing the complaint. View "Fish v. Twp of Lower Merion" on Justia Law

A series of cross-appeals involved tax credits and refunds for overpayments of the City of Philadelphia’s Business Privilege Tax (BPT). The City appealed the Commonwealth Court’s decision affirming the award of credits to Keystone Health Plan East, Inc., and QCC Insurance Company (collectively, Taxpayers), who appealed the same decision affirming the denial of their refund requests. The Philadelphia Department of Revenue agreed Taxpayers overpaid their taxes, but denied the refund requests as untimely. Taxpayers appealed to the Philadelphia Tax Review Board, arguing the net income corrections effectively reset the “due date” since they had 75 days from the completion of an IRS audit to file the amended returns. The Review Board rejected Taxpayers’ argument, determining “due date” referred to the date the returns were initially due (April 15, 2004 and 2005, respectively). Notwithstanding this denial of refunds, the Review Board, sua sponte, awarded Taxpayers credits for their overpayments. The trial court affirmed the Review Board’s decision. Both parties appealed, and a divided three-judge panel of the Commonwealth Court affirmed. The majority further held the trial court did not err in affirming the award of credits. Finding no reversible error in the Commonwealth Court's decision, the Supreme Court affirmed. View "City of Phila. v. Tax Review Bd." on Justia Law

The Department of Revenue assessed additional inheritance taxes on an estate. The court of appeals affirmed the Department’s assessment of tax. At issue on appeal was whether inheritance taxes may be deducted from the value of distributive shares of an estate and whether inheritance tax paid from the estate on behalf of a beneficiary - a bequest of tax - is itself a taxable event. The Supreme Court affirmed, holding (1) a reviewing court does not owe any deference to the Kentucky Board of Tax Appeals as to questions of law; (2) inheritance taxes paid by the estate on behalf of a beneficiary of the estate are not “costs of administration” under a will’s tax-exoneration provision but, rather, are separate bequests that are subject to inheritance taxes; (3) the payment of inheritance tax by an estate on behalf of a beneficiary under a tax-exoneration clause is itself a taxable “bequest of tax”; and (4) like the Department, the court of appeals did not properly apply the law to the facts of this case, but because the end result of the court of appeals’ opinion was to uphold the Department’s assessment of additional tax, its judgment upholding the assessment is affirmed. View "Estate of McVey v. Dep’t of Revenue, Fin. & Admin. Cabinet" on Justia Law