Justia Tax Law Opinion Summaries
Articles Posted in Maine Supreme Court
Plaintiff was a Maine-based law firm with affiliated law offices in other states. In an effort to determine the proper Maine income tax treatment for distributions to its New Hampshire partners, Plaintiff filed a Freedom of Access Act (Act) request with the Maine Revenue Service and the State Tax Assessor, ultimately seeking all allocation and apportionment formulas, methodologies, or calculations applicable to the determination of Maine income tax for nonresident partners in a partnership. The Revenue Service filed for in camera review of seven documents. After reviewing the documents in camera, the superior court determined that the documents were confidential and thus not subject to redaction or disclosure. The Supreme Court affirmed, holding that the documents that were covered by Plaintiff’s request for information consisted entirely of information deemed confidential pursuant to Me. Rev. Stat. Ann. 36, 191(1), which excepts certain tax information and records from the definition of public records pursuant to the Act. View "Preti Flaherty Beliveau & Pachios LLP v. State Tax Assessor" on Justia Law
Plaintiff was the administratrix of a Massachusetts estate appointed by a Massachusetts court. Part of the estate was a parcel of real property located in Maine that was later sold. The estate and the IRS agreed to value the back parcel at $950,000. Plaintiff later filed an amended Maine estate tax return, but insufficient funds remained in the estate to pay the Maine assessment. Plaintiff received a notice of assessment for Maine estate tax informing her that, as the estate's personal representative, she was personally liable for the money owed by the estate. Upon Plaintiff's request for reconsideration, the Assessor upheld an adjusted assessment of $98,180. The superior court vacated the Assessor's decision, concluding that the Assessor lacked jurisdiction to impose personal liability for unpaid estate taxes on a personal representative appointed by an out-of-state court to administer a foreign estate. The Supreme Court vacated the superior court's judgment and remanded for entry of judgment against Plaintiff, holding that Maine tax law provides the Assessor with the authority to hold a personal representative appointed by an out-of-state court personally liable for unpaid Maine estate taxes resulting from the sale of real property located in Maine. View "Metcalf v. State Tax Assessor" on Justia Law
Eagle Rental was a licensed used car dealer. Daniel Bickford and his wife were the company's vice president and treasurer. In 2003, Eagle Rental began purchasing Cadillac Escalades and trading them in to dealers for newer models. The Bickfords were unable to sell their Escalade inventory for several years and drove the Escalades on personal business. The tax assessor assessed use taxes on four of those Escalades. The business and consumer docket affirmed the assessment. Eagle Rental appealed, arguing it did not owe use tax because the Bickfords operated the Escalades with dealer plates for their personal use in accordance with Maine's dealer plate statute. Read together, the dealer plate and taxation statutes provide that dealers and their immediate families may use dealer plates on vehicles in a dealer's inventory for their personal use without being subject to use tax until the vehicles to which the plates are attached are withdrawn from inventory. The Supreme Court affirmed, holding that Eagle Rental did not meet its burden of proving that the Escalades were not withdrawn from inventory, and accordingly, the trial court correctly concluded they were subject to use tax. View "Eagle Rental, Inc. v. State Tax Assessor" on Justia Law
The Town of Madawaska foreclosed on Jeffrey and Jeanne Stoops' property after the Stoops failed to pay municipal taxes. The Town then conveyed the property to Richard and Betty Nelson by municipal quitclaim deed. The Stoopses subsequently filed a complaint against Richard Nelson seeking to quiet title to the property and asking the court to declare the respective rights of the parties to the property. The superior court granted the Nelsons' motion for summary judgment. The Stoopses appealed, arguing (1) the Town failed to give the Stoopses proper notice of the pending foreclosure in violation of their due process rights, and (2) the Town failed to adhere strictly to the requirements of the statutorily outlined steps a municipality must take to foreclose on a municipal tax lien. The Supreme Court affirmed, holding that because the Town complied with the requirements of the statutory scheme and gave the Stoopses sufficient notice, the trial court correctly granted summary judgment in favor of the Nelsons. View "Stoops v. Nelson" on Justia Law
Posted in: Civil Rights, Constitutional Law, Government & Administrative Law, Maine Supreme Court, Real Estate & Property Law, Tax Law
In 2010, Hebron Academy requested a tax abatement from the Town for the 2009 tax year. Because the Academy did not file the abatement request before the statutory deadline, the Town denied the request. The Board of Assessment Review denied the request on the same ground. The Academy subsequently filed a complaint seeking a declaratory judgment that its properties were exempt from taxation and that the Town must reimburse it for real estate taxes it paid on its exempt properties for the prior three years. The superior court declared that the Academy was entitled to the exemption for most of its property but that res judicata precluded the court from relieving it of its obligation to pay the 2009 taxes at issue. The Supreme Court affirmed, holding (1) Hebron Academy, as a literary and scientific institution, was entitled to a tax exemption for its real estate "owned and occupied or used solely for [its] own purpose"; and (2) the trial court correctly concluded that res judicata precluded the declaratory judgment from applying to the 2009 tax year because an administrative adjudication had been rendered on the merits of the case. View "Hebron Academy, Inc. v. Town of Hebron" on Justia Law
Posted in: Government & Administrative Law, Maine Supreme Court, Real Estate & Property Law, Tax Law
Sears, Roebuck & Company appealed a judgment which concluded as a matter of law that the Supreme Court's holding in "Linnehan Leasing v. State Tax Assessor," (898 A.2d 408) applied retroactively. Sears argued that Maine recognizes the practice of retroactively applying certain legal holdings of a decision in a case to the parties in that case but only prospectively in all other instances. Sears urged the Supreme Court to adopt the three-part test enumerated in "Chevron Oil Co. v. Huson" (404 U.S. 97, 106-07 (1971)) when deciding whether to apply the holding of a decision retroactively to other cases. Sears further argued that "Linnehan Leasing" should not apply retroactively because the three Chevron factors weigh in favor of applying the holding with selective prospectivity. Finally, Sears argued that the Court should have reaffirmed its holding in "Myrick v. James" (444 A.2d 987, 1001-02 (Me. 1982)). Without addressing the issue of retroactivity, the Court applied the plain meaning of the statute at issue and affirmed. View "Sears, Roebuck & Company v. State Tax Assessor" on Justia Law
Victor Bravo Aviation, LLC purchased an aircraft in Connecticut in 2004 that was flown to Victor Bravo in Connecticut. Victor Bravo did not register the aircraft in Maine but used it regularly in Maine during the first twelve months of ownership. In 2007, the State Tax Assessor assessed Victor Bravo a use tax on its aircraft plus interest, penalties and costs. Victor Bravo appealed. The Business and Consumer Docket entered summary judgment for the Assessor affirming the assessment of the tax and interest, and judgment for Victor Bravo waiving and abating the non-payment penalty. The Supreme Court affirmed except vacated and remanded the issue of interest waiver or abatement. On remand, the court declined to waive or abate the interest as of the date of the reconsideration decision. Victor Bravo appealed. The Supreme Court affirmed, holding that the court properly considered Victor Bravo's arguments for failure to pay the use tax and deemed them unsatisfactory to warrant a waiver or abatement of interest under the statutory scheme. View "Victor Bravo Aviation, LLC v. State Tax Assessor" on Justia Law
Humboldt Field Research Institute and Eagle Hill foundation applied for a property tax exemption pursuant to Me. Rev. Stat. 36, 652(1)(A) and (B), which the Town assessors denied. The county commissioners upheld the Town's denial, and the superior court affirmed. Humboldt and Eagle Hill appealed, arguing (1) the Town was required to continue Humboldt's and Eagle Hill's tax exemptions from the prior year, which were based on their status as charitable institutions, absent evidence of an organizational change; and (2) the organizations were exempt as literary and scientific institutions. The Supreme Court affirmed, holding (1) Maine law consistently places the burden on the taxpayer to prove entitlement to a tax exemption, even when an exemption has been granted in prior years, if the assessor challenges the exemption; and (2) the commissioners did not err in determining that Humboldt and Eagle Hill did not meet their burden to prove entitlement to an exemption.
After Dorothy Leighton failed to pay taxes on her property and the Town of Blue Hill recorded a tax collector's lien certificate on the property, the Town filed a complaint against Leighton for forcible entry and detainer (FED), seeking possession of the property and costs. The district court entered judgment in Leighton's favor. The superior court vacated the district court's judgment and remanded with instructions to issue a writ of possession in favor of the Town. On appeal, Leighton contended that the Town was required, as a matter of law, to prove that it held current title to the property in the FED action. The Supreme Court affirmed, holding that because the Town produced evidence that it held title superior to Leighton by virtue of the statutorily-foreclosed tax lien mortgage on the property, the Town presented sufficient evidence that it was entitled to possession of the property.
Following a jury trial, appellant Michael Skarbinski was convicted on several counts, all of which arose from appellant's filing requests for tax refunds claiming no taxable income for three years when appellant had received substantial income. The supreme judicial court affirmed, holding (1) the court did not err when it instructed the jury on principles of tax law, and the court's instructions did not infringe upon the jury's role as fact-finder; (2) the court did not err in instructing the jury that if appellant believed the tax laws to be unconstitutional or illegal, or otherwise disagreed with them without an objectively reasonable good faith belief, his belief was not a defense to the charges; (3) the State's closing argument was not inflammatory and it did not improperly interject irrelevant issues into the case; and (4) the jury could have found each element of the offenses charged beyond a reasonable doubt, and the evidence was sufficient to support the convictions.