Under 26 U.S.C. 6621(d), interest is calculated at a higher rate for corporate tax underpayments than for corporate tax overpayments. A corporate taxpayer could, therefore, owe underpayment interest even if the amount underpaid in one tax year (or set of tax years) was entirely offset by the amount by which it overpaid in another tax year (or set of tax years). Congress amended section 6621 in 1998 to include a provision for “global interest netting;” the interest rate differential is adjusted to yield a net interest rate of zero for periods of reciprocal indebtedness, during which the taxpayer’s overpayments in one set of tax years overlap and offset equivalent underpayments in another set,. Congress also adopted a statutory, uncodified, “special rule,” which makes section 6621(d) applicable under certain circumstances to periods of overlapping indebtedness that occurred prior to the 1998 effective date of the statute. The Second Circuit held that the language of the special rule is ambiguous, but that the structure of section 6621(d) as a whole, as well as its historical context and purpose, makes clear that taxpayers may benefit from retrospective global interest netting even when the limitations period for one of the legs of the overlap has expired. View "Exxon Mobil Corp. v. Comm'r of Internal Revenue" on Justia Law

The Bridgewater State University Foundation owns three buildings and three undeveloped parcels. One building is occupied by foundation offices and the university's alumni office; another houses the university's political science department; and the third is used by the university and the foundation for receptions and fundraising. The undeveloped parcels are used by students for recreation. None of the properties is used exclusively by the foundation. The foundation permits the university to use all the properties free of charge. The Appellate Tax Board decided that the foundation was entitled to the charitable exemption from local property taxes, G.L. c. 59, Sect. 5; the Appeals Court reversed. The Massachusetts Supreme Court concluded that the foundation is entitled to the exemption. The foundation is a public charitable trust, and it is "organized and operate[s] exclusively for the benefit of" Bridgewater State University under G.L. c. 15A, sect. 37. The foundation has qualified as a tax-exempt organization under section 501(c)(3) of the Internal Revenue Code. The university is an institution of public higher education and certifies that the foundation is operating "in a manner consistent with" the university's goals and policies and uses its money and assets solely for the benefit of the university. View "Bridgewater State Univ. Found. v. Bd. of Assessors of Bridgewater" on Justia Law

Following a trial, the Minnesota tax court affirmed an order of the Commissioner of Revenue calculating the value of the estate of Ruth Singer and assessing the estate the sum of $69,679 in taxes and interest. The Supreme Court affirmed, holding (1) the tax court had jurisdiction; (2) Minn. Stat. 291.215, which provides that any elections made in valuing the federal gross estate shall be applicable in valuing the Minnesota gross estate, is constitutional, even if it is not uniform or its application results in a regressive tax; (2) the tax court did not err in affirming the Commissioner's assessment; (3) the federal estate tax law does not preempt Minnesota's estate tax law; and (4) the tax court properly determined that the value of Singer's home should be included in her gross estate. View "Singer v. Comm'r of Revenue" on Justia Law

Plaintiffs leased state trust land and owned all structures and improvements on the land. Under the terms of the lease, the improvements that existed on the land would become the state's property upon lease termination. After the leases were entered into, the legislature created a property tax classification ("Class Nine") in which property was taxed at a lower rate than that applicable to commercial property. For certain years, Maricopa County classified the improvements under the classification applicable to general commercial property and taxed Plaintiffs accordingly. The State Board of Equalization denied Plaintiffs' request for Class Nine classification. Plaintiffs then filed a declaratory judgment action in the tax court. The tax court granted summary judgment for the County based on Plaintiffs' failure to meet the requirements of Ariz. Rev. Stat. 42-12009(A)(1)(a), which provides that improvements on land leased from the state qualify for a reduced ad valorem tax rate if they become the property of the state on termination of the leasehold interest in the property. The Supreme Court remanded, holding that section 42-12009(A)(1)(a) applies when, at the time of taxation, improvements exist on the land that, under the terms of the lease, would become the state's property upon lease termination. View "CNL Hotels & Resorts, Inc. v. Maricopa County" on Justia Law

This case required the Supreme Court to decide whether filmmakers receiving tax credits from the State of Iowa under the State's tax credit program could enjoin the State from releasing summaries of their films' final budgets to the public. The district court determined they could. The Supreme Court reversed, holding (1) the budget summaries do not qualify as trade secrets under Iowa Code 22.7(3); (2) the budget summaries cannot be considered "reports to governmental agencies which, if released, would give advantage to competitors and serve no public purpose" under Iowa Code 22.7(6); and (3) the filmmakers failed to meet Iowa Code 22.8's requirements for injunctive relief by demonstrating disclosure would not be in the public interest and would substantially and irreparably injure any person or persons. Remanded. View "Iowa Film Prod. Servs. v. Iowa Dep't of Econ. Dev." on Justia Law

This appeal was the latest iteration of a decade-long dispute between the Miller Brewing Company and the Indiana Department of Revenue over Miller's Indiana adjusted gross income tax liability. The Department here appealed the tax court's determination that Miller owes no tax on certain sales to Indiana customers. The Supreme Court reversed, holding (1) the relevant statute was unambiguous; and (2) an example in the statute used by Miller in its argument was specifically designated as an example and not a rule and did not have the force of law, and therefore, the tax court erred in determining that the example operated to exempt Miler from liability for Indiana tax on income from sales of good delivered by common carrier to Indiana customers. View "Ind. Dep't of Revenue v. Miller Brewing Co." on Justia Law

The Mississippi Department of Revenue (MDOR) issued a subpoena to Pikco Finance, Inc. (Pikco), requesting documentation pertaining to Pikco's nonpayment of finance company privilege taxes. Pikco filed a petition to quash the subpoena on the basis that MDOR's ability to audit and tax under Mississippi's Finance Company Privilege Tax law was preempted by the National Bank Act. The circuit court granted Pikco's petition to quash, and MDOR appealed. The issue on appeal was whether MDOR's use of its statutory subpoena power in administration of the Finance Company Privilege Tax was preempted by the National Bank Act. Upon review, the Supreme Court reversed and remanded, finding that Pikco was subject to the subpoena. View "Mississippi Dept. of Revenue v. Pikco Finance, Inc." on Justia Law

Bancorp owns the 792 and 037 patents, for tracking value of life insurance policies in separate accounts, under which the policy owner pays a premium beyond that required for the death benefit and specifies types of assets in which additional funds are invested. Corporations use the policies to insure employees’ lives and fund retirement benefits on a tax-advantaged basis. The value of a separate account policy fluctuates; owners must report the value of their policies. The patents provide a computerized means for tracking book and market values and calculating stable value guarantee. Bancorp sued Sun Life for infringement. In another suit, the court invalidated the 792 patent for indefiniteness. Bancorp and Sun Life stipulated to conditional dismissal on collateral estoppel. The Federal Circuit reversed the other case. The district court vacated dismissal then granted summary judgment of invalidity under section 101 (ineligible abstract ideas) without addressing claim construction and analyzing each claim as a process claim. Applying “the machine-or-transformation test,” specified computer components are only objects on which claimed methods operate, and the central processor is a general purpose computer programmed in an unspecified manner for a process that can be completed manually. The claims “do not transform the raw data into anything other than more data and are not representations of any physically existing objects.” The Federal Circuit affirmed. View "Bancorp Servs., L.L.C. v. Sun Life Assurance Co. of Canada" on Justia Law

The Government filed suit against Defendant, Barbara Coney, to reduce to judgment the tax liability owed by Barbara and her deceased husband, Curtis, for the tax years 1996-2001. The district court granted summary judgment in favor of the Government and rendered judgment in the amount of $2,687,408. Barbara appealed, primarily claiming that the couple's tax liability had been discharged in a prior bankruptcy proceeding. The Fifth Circuit Court of Appeals affirmed, holding (1) Curtis willfully attempted to evade or defeat his tax liabilities for the tax years at issue; (2) Barbara willfully attempted to evade or defeat her tax liabilities for the tax years at issue; and (3) the district court did not err in awarding the Government a money judgment, and the court awarded the judgment in a proper amount. View "United States v. Coney" on Justia Law

In 2008, Stearns County changed the tax classification of property co-owned by Respondent from residential nonhomestead to commercial. Respondent filed a petition under Minn. Stat. 278.01, claiming the property was misclassified, unequally assessed, and undervalued. The tax court dismissed the petition as untimely. Respondent did not appeal from the tax court's dismissal of its petition and instead filed a verified claim under Minn. Stat. 278.14 for a refund of taxes paid in 2009, claiming the property was misclassified for taxes payable in 2009. The County denied the refund claim. The tax court denied the County's motion to dismiss the section 278.14 appeal (Matter A11-1479). In the meantime, Respondent filed a timely petition under Minn. Stat. 278.01 with respect to property taxes assessed in 2009. The tax court ruled the property was properly classified as residential nonhomestead, its original classification (Matter A11-1480). The County petitioned for writ of certiorari in both matters. The Supreme Court dismissed the writs of certiorari, concluding that it lacked jurisdiction in each case. View "Beuning Family LP v. County of Stearns" on Justia Law