Justia Tax Law Opinion Summaries

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Greenville County Council implemented what it called a "road maintenance fee" to raise funds for road maintenance and a "telecommunications fee" to upgrade public safety telecommunication services. Plaintiffs, three members of the South Carolina General Assembly, claimed the two charges were taxes and, therefore, violated section 6-1-310 of the South Carolina Code (2004). The South Carolina Supreme Court agreed: the road maintenance and telecommunications taxes were invalid under South Carolina law. View "Burns v. Greenville County Council" on Justia Law

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In this appeal requiring the Supreme Court to determine the priority of tax liens levied on real property by the Georgetown Special Taxing District the Supreme Court reversed the judgment of the trial court subordinating liens acquired by Defendant to the Georgetown Fire District, holding that the fire district's tax liens were subordinate to those of Defendant, which, in turn, were subordinate to those of the town.Plaintiffs - the town of Redding, the Redding Water Pollution Control Commission, and Georgetown Fire District - brought this action to foreclose municipal liens against Defendant RJ Tax Lien Investments, LLC, who had been assigned real estate tax liens originally levied by the taxing district. The trial court granted the motions for partial summary judgment with respect to priority filed by the town and the fire district and rendered a judgment of strict foreclosure in favor of the town and the fire district. The Supreme Court reversed in part, holding that the trial court incorrectly concluded that Defendant's liens were subordinate to those of the fire district. View "Redding v. Georgetown Land Development Co., LLC" on Justia Law

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The Supreme Court affirmed the judgment of the district court holding that the "resort service fee" that Boyne USA, Inc. charges guests is not subject to Montana's lodging facilities use tax and forfeited guests deposits collected by Boyne are not subject to either the state use tax or sales tax, holding that the district court did not err.Specifically, the Supreme Court held that the district court (1) did not err in holding that Boyne's resort services fee was not subject to the lodging facilities use tax; (2) did not err in holding that the resort services fee was subject to the sales tax; and (3) did not err by holding that forfeited guest deposits are not subject to the lodging facilities use tax or the sales tax. View "Boyne USA, Inc. v. Department of Revenue" on Justia Law

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Gasoline is subject to an excise tax. The combined fuel excise taxes account for more than 80% of the annual revenue collected for the Highway Trust Fund. The 2005 Safe, Accountable, Flexible, Efficient Transportation Equity Act. introduced new credits that fuel producers could use to offset their fuel excise taxes, including one for using “alternative fuels” to create “alternative fuel mixtures” (AFM credit), 26 U.S.C. 6426(e).U.S. Venture buys fuel from various suppliers and combines it with different additives before selling the finished product to retailers. Since 2012 U.S. Venture has commonly added butane to the gasoline it produces and sells. Butane is a type of gas, made from both natural gas and petroleum. It has long been considered a fuel additive, with suppliers adding it to gasoline since at least the 1960s.In 2017. U.S. Venture first sought an AFM tax credit for producing and selling fuel that contained a mixture of gasoline and butane. The IRS rejected its position. The district court and Seventh Circuit affirmed. There is nothing alternative about gasoline containing a butane additive, as indicated by a combination of statutory provisions defining the scope of the alternative fuel mixture tax credit. View "U.S. Venture, Inc. v. United States" on Justia Law

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This appeal relates to TOT Holdings' execution of a deed that donated to Foothills Land Conservancy, a conservation easement encumbering nearly all its property. The IRS disallowed the deduction claimed by the taxpayer, and the Tax Court upheld that decision because the deed conveying the easement contained a formula for the distribution of proceeds that did not comply with the extinguishment proceeds requirement and the deed was not saved by purported interpretive provisions. The taxpayer appealed.The Eleventh Circuit concluded that the Tax Court correctly determined that the taxpayer did not comply with the extinguishment proceeds requirement and that the deed was not saved by the disputed provisions because they constitute an unenforceable condition-subsequent savings clause. The court also held that the Tax Court did not commit reversible error in approving the penalties assessed. Accordingly, the court affirmed the judgment. View "TOT Property Holdings, LLC v. Commissioner of Internal Revenue" on Justia Law

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A mining company appealed the borough assessor’s valuation of its mine to the borough board of equalization. At a hearing the company presented a detailed report arguing the borough had improperly included the value of “capitalized waste stripping”when calculating the tax-assessed value of the mine. The assessor maintained its position that waste stripping was taxable, but reduced its valuation of the mine to better reflect the remaining life of the mine. The board approved the assessor’s reduced valuation of the mine and the superior court affirmed the board’s decision. The mine owners argued that waste stripping fell within a statutory exemption from taxation. The Alaska Supreme Court construed municipal taxing power broadly, and read exceptions to that power narrowly. The Court found waste stripping was not a “natural resource,” but an improvement that made it easier for miners to access natural resources. The Court concluded that the value of this improvement, like that of other improvements at the mine site, was subject to tax by the borough. The Court therefore affirmed the superior court’s decision affirming the board’s valuation. View "Fairbanks Gold Mining, Inc. vs. Fairbanks North Star Borough Assessor" on Justia Law

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The real estate taxes on Brown’s mineral rights were not paid. In 2013, the Hamilton County collector sold the delinquent taxes. Castleman extended the taxes’ redemption date to October 10, 2015, and filed a petition for a tax deed on June 22, 2015. An October 2015 order under Property Tax Code (35 ILCS 200/22-40(a)) directed the clerk to issue a tax deed to Castleman. Castleman assigned the tax sale certificate to Groome. Brown sold the mineral rights to SI by quitclaim deed. In November 2015, SI moved to vacate the section 22-40(a) order. The trial court dismissed for lack of standing. Meanwhile, Groome recorded a tax deed in February 2016. In June 2017, SI sought a writ of mandamus against the Hamilton County clerk who conceded that the 2016 Groome deed did not comport with the underlying section 22-40(a) order, which directed the deed to be issued to Castleman. The court granted SI’s requests. Castleman and Groome were not parties in the mandamus proceedings.The appellate court found the motion to vacate the section 22-40(a) order "a nullity.” The Hamilton County clerk issued Castleman a “Corrective Tax Deed” in October 2017, in compliance with the original section 22-40(a) order. SI filed a “Section 22-85 Motion to Void Tax Deed” and a “[Section] 2-1401/22-45 Petition to Vacate the October 2015 Order Directing Issuance of Tax Deed.” The appellate court affirmed the dismissal of both counts.The Illinois Supreme Court affirmed. A tax deed issued and was recorded within the mandatory time limit. The deed’s failure to name the proper party created a conflict between the deed and the section 22-40(a) order. While timely filing may result in the tax deed becoming “absolutely void,” 35 ILCS 200/22-85, the conflict with the order does not. The court’s mandamus order is properly viewed as reforming and correcting the 2016 tax deed to comport with the section 22-40(a) order. View "In re Application for a Tax Deed" on Justia Law

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In filing mortgage foreclosure cases, the plaintiffs each paid a $50 “add on” filing fee under section 15-1504.1 of the Code of Civil Procedure. The plaintiffs challenged the constitutionality of section 15-1504.1 and of sections 7.30 and 7.31 of the Illinois Housing Development Act, 20 ILCS 3805/7.30, 7.31, which created foreclosure prevention and property rehabilitation programs funded by the fee.The trial court, following a remand, held that the fee violated the equal protection, due process, and uniformity clauses of the Illinois Constitution of 1970. The Illinois Supreme Court affirmed, finding that the fee violates the constitutional right to obtain justice freely. The $50 filing charge established under section 15-1504.1, although called a “fee,” is, in fact, a litigation tax; it has no direct relation to expenses of a petitioner’s litigation and no relation to the services rendered. The court determined that the plaintiffs paid the fee under duress; the voluntary payment doctrine did not apply. View "Walker v. Chasteen" on Justia Law

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California cigarette tax regulations apply to inter-tribal sales of cigarettes by a federally chartered tribal corporation wholly owned by a federally recognized Indian tribe.The Ninth Circuit affirmed the district court's dismissal of an action brought by Big Sandy, a chartered tribal corporation wholly owned and controlled by the Big Sandy Rancheria of Western Mono Indians, seeking declaratory and injunctive relief against the Attorney General of California and the Director of the California Department of Tax and Fee Administration regarding taxes applied to inter-tribal sales of cigarettes.The panel concluded that the district court properly dismissed the Corporation's fifth cause of action on jurisdictional grounds pursuant to the Tax Injunction Act, 28 U.S.C. 1341, and properly declined to apply the Indian tribes exception to the Tax Injunction Act's jurisdictional bar. The panel also concluded that the district court properly dismissed the Corporation's remaining causes of action challenging the Directory Statute and California's licensing, reporting, and recordkeeping requirements in connection with cigarette distribution. In this case, the Corporation challenged the Directory Law on two grounds: (1) applying the challenged regulations to the Corporation's cigarette sales to tribal retailers on other reservations violates "principles of Indian tribal self-governance;" and (ii) federal regulation of "trade with Indians within Indian country" under the Indian Trader Statutes preempts the challenged regulations as applied to the Corporation's intertribal wholesale cigarette business. The panel concluded that the district court properly dismissed both theories for failure to state a claim. Accordingly, the panel affirmed the district court's dismissal for lack of subject matter jurisdiction and for failure to state a claim. View "Big Sandy Rancheria Enterprises v. Bonta" on Justia Law

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An oil producer challenged an Alaska Department of Revenue advisory bulletin interpreting the oil tax code, arguing that the bulletin violated the Alaska Administrative Procedure Act (APA) and seeking a declaratory judgment that the interpretation was contrary to law. The Alaska Supreme Court determined the advisory bulletin could not be challenged under the APA because it was not a regulation, and that a declaratory judgment was not available because the tax dispute between the parties was not ripe. View "Exxon Mobil Corporation v. Alaska, Department of Revenue" on Justia Law