Justia Tax Law Opinion Summaries

The case revolves around Outfront Media LLC (Outfront), a company that entered into a contract with the Massachusetts Bay Transportation Authority (MBTA) to advertise on outdoor signs owned by the MBTA. The city of Boston assessed real estate tax for fiscal year 2021 on Outfront for the signs. Outfront sought an abatement of the tax, arguing that the signs were exempt from taxation under § 24. The city denied Outfront's claim for abatement, and Outfront appealed to the Appellate Tax Board (board), which upheld the tax assessment.The Appellate Tax Board upheld the city of Boston's tax assessment on Outfront Media LLC for the use of outdoor advertising signs owned by the Massachusetts Bay Transportation Authority (MBTA). Outfront had argued that the signs were exempt from taxation under § 24, but the board disagreed, leading to Outfront's appeal.The Supreme Judicial Court of Massachusetts affirmed the decision of the Appellate Tax Board. The court held that Outfront's use of the MBTA's outdoor advertising signs to post advertisements and generate advertising revenue constituted a "use" of the MBTA's property "in connection with a business conducted for profit" under § 24. The court distinguished such businesses from those merely providing a service for the MBTA such as a janitorial service. Therefore, Outfront used the signs within the meaning of § 24 and the decision of the board was upheld. View "Outfront Media LLC v. Board of Assessors of Boston" on Justia Law

The court examined a case involving a divorcing couple, Amy Sue Openshaw and Glen Romney Openshaw, who had a custom of regularly saving a portion of their income throughout their marriage. The husband contested the judge’s alimony decision, arguing that the judge should not have considered the couple's practice of saving as part of the marital lifestyle in setting the amount of alimony.The court held that where a couple has a customary practice of saving during the marriage, such saving can be considered as a component of the couple's marital lifestyle in determining alimony. Therefore, the judge did not err in considering the parties' regular savings practice in setting the alimony amount.The husband also disputed the division of liabilities, as the judge assigned the wife only $5,032 in liabilities, while the husband was assigned $343,280, primarily for the family's unpaid tax debt. The court found the division of liabilities to be erroneous as the judge did not explain why the tax debt, a significant marital liability, was assigned solely to the husband. The court ordered a remand to reevaluate the division of liabilities in the judgment. View "Openshaw v. Openshaw" on Justia Law

The Supreme Judicial Court held that when an otherwise qualifying entity sells an urban redevelopment project during the forty-year tax window set forth in Mass. Gen. Laws ch. 121A, 18C, the tax concession extends to the capital gain from the sale.The tax exemption at issue provides an incentive for private entities to invest in constructing, operating, and maintaining urban redevelopment projects in deteriorated areas. At issue was whether the sale of an urban redevelopment project during the forty-year tax-exempt window is "on account of" the project, thus extending the tax concession to the capital gain from the sale. In this case, the Commission of Revenue issued notice of assessment to Appellants related to their capital gains from the sales of certain ch. 121A projects. The Supreme Judicial Court reversed, holding that the capital gain from the sale of the ch. 121A project fell within the tax concession. View "Reagan v. Commissioner of Revenue" on Justia Law

The Supreme Judicial Court affirmed the decision of the appellate tax board permitting an abatement requested by a nondomiciliary seller, holding that 830 Code Mass. Regs. 64H.1.7 did not by its plain terms permit the Commissioner of Revenue to apply the Court's new rule, which replaced a bright-line rule, to the tax period at issue in this case.The bright-line rule was adhered to by the United States Supreme Court as it pertained to the constitutional limits of a State's authority to impose an obligation on a nondomiciliary seller to collect and remit a sales or use tax when a consumer purchases goods or services for use or consumption in the state. In 2018, the Court concluded that the rule's requirement that the nondomiciliary seller have a "physical presence" was no longer required. Here, the Commissioner argued that the pre-2018 regulation at issue in this case incorporated the Court's new rule retroactively. The Supreme Court disagreed and affirmed the appellate tax board's decision, holding (1) the regulation incorporated the bright-line rule set forth in pre-2018 jurisprudence and did not permit the Commissioner to apply the new rule to this case; and (2) the existence of what the Commissioner described as "electrons" in the Commonwealth did not satisfy the applicable physical presence test. View "U.S. Auto Parts Network, Inc. v. Commissioner of Revenue" on Justia Law

The Supreme Judicial Court reversed the decision of the Appellate Tax Board in this case concerning the constitutional restraints on the Commonwealth's ability to tax a nondomiciliary corporation on the capital gain it repealed from the sale of its fifty percent membership interest in an in-State limited liability company, holding that the tax in question was invalid.On appeal, the Commissioner of Revenue conceded that, under the unitary business principle as applied to the facts of this case, the capital gain at issue in this case was not taxable in the Commonwealth, but that the capital gain may nonetheless be taxed because it reflects the in-State entity's growth in the Commonwealth. The Supreme Judicial Court disagreed, holding (1) the capital gain could be subject to the Commonwealth's tax; but (2) the Commissioner lacked the requisite statutory authority to tax the capital gain. View "VAS Holdings & Investments LLC v. Commissioner of Revenue" on Justia Law

The Supreme Judicial Court affirmed the decision of the Appellate Tax Board granting certain vendors' applications for refunds through the general abatement process for the portion of sales tax they had paid to the Commonwealth that was attributable to out-of-state use of software, holding that Mass. Gen. Laws ch. 64H, 1 creates a statutory right to apportionment for software transferred for use in multiple states.The vendors in this case sold or licensed software to Hologic, Inc., a medical device company headquartered in Massachusetts. At the time sales taxes were due, the vendors remitted tax payments to the Commonwealth based on the entire value of the transactions. When the vendors were informed that only a portion of the software was to be used in the Commonwealth, they applied for refunds. The Commissioner of Revenue denied the applications for abatement on the grounds that the regulations for apportionment were not followed. The Board granted the requested abatements. The Supreme Judicial Court affirmed, holding (1) the vendors had a statutory right to apportionment; and (2) the general abatement process was available to the vendors, despite their having paid sales tax in excess of that properly apportioned to sales in the Commonwealth. View "Oracle USA, Inc. v. Commissioner of Revenue" on Justia Law

The Supreme Judicial Court affirmed the decision of the Land Court judge ruling that the statutory scheme set forth in Mass. Gen. Laws ch. 60, 52 did not permit assignees of tax title accounts to include their own subsequent tax payments in the amount required for redemption, holding that the judge did not err.In 2011, City took tax title to Owners' property. Owners did not pay their real estate taxes in 2012 through 2015. In 2016, City assigned Appellant its tax title to the property. Appellant initiated proceedings to foreclose Owners' right to redeem the property. Owners exercised their right of redemption. In 2018, Appellant asked the Land Court to find that the redemption amount include the taxes owed to City at the time Appellant was assigned the tax title account, the taxes that Appellant had paid on the property from 2016 through 2018, and statutory interest on the unpaid real estate taxes and the taxes paid by Appellant. The judge concluded that tax payments made by section 52 assignees subsequent to the assignment of the tax title account could not be included in the redemption amount. The Supreme Judicial Court affirmed, holding that section 52 assignees of tax title accounts may not include their own subsequent tax payments, and interest thereon, in their redemption demands. View "Tallage Lincoln, LLC v. Williams" on Justia Law

The Supreme Judicial Court affirmed the decision of the appellate tax board (board) upholding the Commissioner of Revenue's assessment of an additional Massachusetts estate tax based on the value of a qualified terminable interest property (QTIP) trust in computing a decedent's Massachusetts estate tax return, holding that there was not a constitutional or a statutory barrier to the assessment.Robert Chuckrow created a QTIP trust in New York. Adelaid Chuckrow (decedent) was the lifetime income beneficiary of the QTIP trust and deed domiciled in Massachusetts. The decedent's estate (estate) did not include the value of the QTIP trust assets in computing her Massachusetts estate tax return. After an audit, the Commission assessed an additional Massachusetts estate tax of almost $2 million based on the value of the QTIP assets. The board upheld the assessment. At issue before the Supreme Judicial Court was whether the intangible assets in the QTIP trust were includable in the gross estate of the decedent for purposes of calculating the Massachusetts estate tax under Mass. Gen. Laws ch. 65C, 2A(a). The Supreme Judicial Court affirmed, holding that the QTIP assets were includable in the estate for purposes of the Massachusetts estate tax. View "Shaffer v. Commissioner of Revenue" on Justia Law

The Supreme Judicial Court affirmed the decision of the Appellate Tax Board (the Board) upholding sales tax assessments for fees charged for subscriptions to use online software products, holding that the subscription fees were subject to sales tax.Appellant sold subscriptions for three online software products. The Commissioner of Revenue determined that Appellant's subscription fees constituted sales of software subject to sales tax and assessed sales tax against Appellant for the taxable periods April 2007 through June 2009 and October 2009 through December 2011. The Board upheld the sales tax assessments. The Supreme Judicial Court affirmed, holding that receipts from sales of subscriptions for the online software products were subject to Massachusetts sales tax. View "Citrix Systems, Inc. v. Commissioner of Revenue" on Justia Law

The Supreme Judicial Court affirmed the decision of the board of assessors of Boston, holding that taxed personal property owned by and assessed to Veolia Energy Boston, Inc. consisting principally of pipes that Veolia used to produce, store, and distribute steam is exempt from local taxation and that the great integral machine doctrine remains an appropriate means by which to determine whether certain property constitutes machinery.At issue was whether the pipes were exempt from local taxation in accordance with Mass. Gen. Laws ch. 59, 5, clause 16 (3), which provides that property owned by a manufacturing corporation "other than...pipes" is exempt from local taxation. The board found that Veolia's networks of pipes and appurtenant equipment operate in concert as a single, integrated machine and, as a result, concluded that the pipes constituted machinery exempt from local taxation in accordance with clause 16 (3). The Supreme Judicial Court affirmed, holding that the board's reasoning in all material aspects was sound and that there was no basis for disturbing the board's decision. View "Veolia Energy Boston, Inc. v. Board of Assessors of Boston" on Justia Law