Justia Tax Law Opinion Summaries

Fenix Construction Company of St. Louis, Five Star Ready-Mix Concrete Company and Horstmeyer Enterprises, Inc. (collectively, Taxpayers) filed sales tax refund claims for their purchases of materials used to construct tilt-up concrete walls. Taxpayers asserted that the materials fell within the Mo. Rev. Stat. 144.054.2 tax exemption for materials used in “manufacturing…any product.” The director of revenue denied the claims. The Administrative Hearing Commission (AHC) also denied the refund claims, determining that the tax exemption was inapplicable because the tilt-up concrete walls were not a “product” pursuant to section 144.054.2. The Supreme Court affirmed, holding that the AHC correctly determined that Taxpayers did not establish that the tilt-up concrete walls were a “product” as that term is used in section 144.054.2. View "Fenix Constr. Co. of St. Louis v. Dir. of Revenue" on Justia Law

In 2014, the City of Draper passed and adopted a Resolution that levied a tax on property located within the Traverse Ridge Special Service District. Petitioners, five residents, collected certified voter signatures and asked the City to refer the Resolution to voters of the District. The City rejected the referendum petition, asserting that the tax levy was a nonreferable administrative action. Petitioners filed a petition for writ of extraordinary relief. The Supreme Court granted the relief sought, holding (1) the Resolution was properly referable to the voters because it was legislative in nature; and (2) the City’s constitutional challenge to the subjurisdictional referendum statute failed. View "Mawhinney v. Draper City" on Justia Law

Petitioners Garfield and Lucille Goodrum owned 41.54 acres in Reading; all but two acres of land surrounding their home was enrolled in the UVA Program as undeveloped forest land. The Goodrums formed Turtle Hill Farm of Vermont Animal Sanctuary, Inc. (THF), a non-profit corporation whose mission is to rescue, rehabilitate, foster, and adopt out animals, including horses, chickens, rabbits, and guinea pigs. The Goodrums leased four barns and two sheds to THF. THF is funded almost exclusively by donations, which it uses to cover its operating expenses. Most of the donations come from the Goodrums. In 2010, the Goodrums applied to enroll the barns and sheds leased to THF in the UVA Program, which would exempt the buildings from property taxation, but the Department of Taxes Division of Property Valuation and Review (PVR) determined that the buildings were ineligible. The Goodrums appealed to the Director of PVR, who also determined that the buildings were ineligible. The Goodrums then appealed to the superior court, and both parties moved for summary judgment. The court granted PVR's motion, concluding that the buildings are not eligible for enrollment because THF did not operate for gain or profit and is therefore not a farmer under 32 V.S.A. 3752(7). The Goodrums appealed. Finding no reversible error, the Supreme Court affirmed. View "Goodrum v. Vermont Department of Taxes" on Justia Law

In June 2011 the Department of Revenue assessed additional individual, sales, and corporate taxes against taxpayers Southside, Inc. d/b/a Wines, Etc. and Barry and Sarabeth Artz. They appealed a Board of Tax ruling without satisfying the statutory requirements of paying the disputed taxes under protest before appealing or posting a surety bond with their appeal. Because the chancery court lacked appellate jurisdiction to hear the appeal, the chancellor granted the Department of Revenue’s motion to dismiss. Finding no reversible error, the Supreme Court affirmed. View "Southside, Inc. d/b/a Wines, Etc. v. Mississippi Department of Revenue" on Justia Law

This case stemmed from an indirect gift made by J. Howard Marshall to various family members. After J. Howard's Estate failed to pay gift taxes pursuant to I.R.C. 6324(b), the IRS tried to collect the unpaid gift tax from the donees. The Government subsequently filed suit against the donees, seeking to recover the unpaid gift taxes and to collect interest from the beneficiaries. The Government also sought to recover from two individuals (E. Pierce Jr. and Hilliard), who, as representatives of various estates and trusts, allegedly paid other debts before paying those owed to the Government. The court rejected appellants' argument that the district court erred in finding that the donees incurred an independent interest liability as a result of the donor's unpaid gift tax and held that interest accrues on donee's liability for the unpaid gift taxes and that interest is not limited to the extent of the value of the gift. The court concluded that res judicata barred Eleanor Pierce (Marshall) Stevens from arguing that J. Howard did not make a gift to her because the court determined that Stevens was a donee. Finally, the court held that Hilliard and E. Pierce Jr. knew of the potential liability to the Government and the Federal Priority Statute applies; Hilliard and E. Pierce Jr. are liable under the Federal Priority Statue for the amount of the charitable set-aside; E. Pierce Jr. is individually liable for the value of the personal property he distributed from Stevens's Estate; Hilliard is personally liable for the amount he caused the Living Trust to pay for accounting and legal services on behalf of other charitable organizations; and E. Pierce Jr. did not breach his state law fiduciary duties because E. Pierce Jr. did not owe Stevens's Estate's creditors a fiduciary duty under Texas law. Accordingly, the court affirmed in part and reversed in part. View "United States v. Marshall, et al." on Justia Law

Taxpayer Erma Glasgow challenged the Tax Court’s jurisdiction, its conclusion that she was liable for personal income taxes based on wages that she earned in tax years 2007 through 2010, and its assessment of a penalty for pursuing a frivolous appeal. Finding no reversible error, the Oregon Supreme Court affirmed. View "Glasgow v. Dept. of Rev." on Justia Law

Petitioner sought review of the Tax Court's final order and decision for redetermination of deficiency brought under 26 U.S.C. 6213(a), arguing that the Tax Court erred by concluding that the $5.75 million petitioner received from the assignment of his position as plaintiff in a lawsuit constituted taxable ordinary income, rather than long term capital gains. The court held that the profit from the $5.75 million petitioner received in the sale of his position in the lawsuit is more appropriately characterized as capital gains. Therefore, the court reversed the Tax Court's decision as to this issue and remanded with instructions. The court rejected petitioner's argument that the Tax Court erred by not treating his $600,00 payment to Steelervest as a deductible "reduction of income" where petitioner has not met his burden of clearly establishing his entitlement to a particular deduction. Therefore, the court affirmed the Tax Court's decision as to this issue. Finally, because petitioner's evidence of unaccounted legal fees was insufficient and petitioner did not present sufficient evidence of a deductible expense, the court affirmed the Tax Court's decision on this issue. Accordingly, the court affirmed in part and reversed in part, remanding with instructions for further proceedings. View "Long v. Commissioner of IRS" on Justia Law

The main issue on appeal in this case was whether the purchase of electricity and natural gas utility services qualifies for a sales tax exemption. Appellant-taxpayer American Airlines, Inc., ("AA") was denied a refund for the sales tax it paid on its purchases of electricity and natural gas utility services during the 2006 calendar year. The Account Maintenance and Compliance Division of the Oklahoma Tax Commission denied the request. Appellant timely protested the denial. The Oklahoma Tax Commission, by order, adopted the Findings, Conclusions and Recommendations of the administrative law judge finding taxpayer failed to prove the denial was incorrect. Upon review, the Supreme Court held the Services Exemption (68 O.S. Supp. 2006, section 1357 (28)) provided an exemption for electricity and natural gas utility services used by AA during 2006 in aircraft repair and maintenance activities. The remaining issue concerned the appropriate methodology for determining the amount of the sales tax refund AA should have received on its 2006 purchases of utility services. The adopted Findings, Conclusions and Recommendations did not make a specific finding concerning an appropriate methodology. The Court remanded the case back to the Oklahoma Tax Commission for further proceedings. View "American Airlines, Inc. v. Oklahoma Tax Commission" on Justia Law

Canal Winchester MOB, LLC (“MOB”), the ground lessee of a medical office building, filed a complaint challenging the tax-year-2010 valuation of the building. The Board of Revision retained the auditor’s valuation. MOB, together with the record owner of the property, appealed. In its decision, the Board of Tax Appeals (“BTA”) sua sponte considered the jurisdictional validity of the complaint and held that MOB did not have standing to file the complaint. Accordingly, the BTA ordered dismissal. The Supreme Court vacated the BTA’s decision, holding that the BTA should have afforded MOB the opportunity to plead and prove its standing. Remanded. View "Diley Ridge Med. Ctr. v. Fairfield County Bd. of Revision" on Justia Law

Petitioner Merry-Go-Round Playhouse, a not-for profit theater corporation, owned real property that it used to house its staff and summer stock actors. Petitioner filed applications for real property tax exemptions under N.Y. Real Prop. Tax Law 420-a. The Assessor of the City of Auburn denied the applications. Supreme Court upheld the denial, determining that Petitioner failed to establish that its summer theater was an exempt purpose and that the use of apartment buildings to house its employees was reasonably incidental to its primary purpose. The Appellate Division reversed. The Court of Appeals affirmed, holding that Petitioner established its entitlement to the tax exemption because the use of the property to provide staff housing was reasonably incidental to Petitioner’s primary purpose of encouraging appreciation of the arts through theater. View "Matter of Merry-Go-Round Playhouse, Inc. v. Assessor of City of Auburn" on Justia Law