Justia Tax Law Opinion Summaries

After John Worthen amassed over eighteen million dollars in unpaid tax liabilities, the federal government placed liens on properties it claimed belonged to his alter egos or nominees. Following a court- ordered sale of the properties, Worthen sought to exercise a statutory right to redeem under Utah state law. The district court concluded there were no redemption rights following sales under 26 U.S.C. 7403. The Tenth Circuit concurred, finding neither section 7403 nor 28 U.S.C. 2001, which governed the sale of realty under court order, explicitly provided for redemption rights. Moreover, federal tax proceedings provided sufficient protection for taxpayers and third parties. View "Arlin Geophysical Company v. United States" on Justia Law

Plaintiff Ventas Realty Limited Partnership (Ventas), appealed a superior court order denying its request for an abatement of the real estate taxes it paid defendant City of Dover (City), for the 2014 tax year. The subject real estate consists of a 5.15-acre site containing a skilled nursing facility serving both short-term and long-term patients, two garages, and a parking lot. At issue was the City’s April 1, 2014 assessment of the real estate at a value of $4,308,500. Ventas alleged that it timely applied to the City for an abatement of its 2014 taxes. The City presumably denied or failed to act upon the request, and Ventas, thereafter, petitioned the superior court for an abatement pursuant to RSA 76:17 (Supp. 2018), alleging that the City had unlawfully taxed the property in excess of its fair market value. Expert witnesses for both sides opined the property’s highest and best use was as a skilled nursing facility. The experts also agreed that the most reliable method for determining the property’s fair market value was the income capitalization method, although the City’s expert also completed analyses under the sales comparison and cost approaches. Both experts examined the same comparable properties and they also used similar definitions of “fair market value.” The main difference between the approaches of the two experts is that the City's expert used both market projections and the property’s actual income and expenses from 2012, 2013, and 2014 to forecast the property’s future net income, while Ventas' expert did not. Ventas' expert used the property’s actual income and expenses for the 11 months before the April 1, 2014 valuation date, without any market-based adjustments. Despite their different approaches, the experts gave similar estimates of the property’s projected gross income for tax year 2014. The experts differed greatly in their estimates of the property’s projected gross operating expenses for tax year 2014. All of Ventas’ arguments faulted the trial court for finding the City's expert's valuations more credible than its own expert's valuations. The New Hampshire found the trial court made numerous, specific findings which were supported by the record as to why it rejected Ventas' expert's appraisal. Accordingly, the Supreme Court upheld the trial court’s determination that Ventas' expert's appraisal failed to meet Ventas’ burden of proof. View "Ventas Realty Limited Partnership v. City of Dover" on Justia Law

The Supreme Court affirmed in part and reversed in part the judgment of the trial court entering judgment in favor of the cities of Aurora, Cameron, Oak Grove, and Wentzville (collectively, the Cities) in this action for declaratory judgment and injunctive relief against CenturyLink, Inc. and its subsidiaries, holding that the trial court erred in awarding prejudgment interest and attorneys fees to the Cities.In their petition, the Cities alleged that, since 2000, CenturyLink failed to pay all license taxes owed under the Cities' respective ordinances. Further, the Cities alleged that CenturyLink failed to enter into right-of-way user agreements under Cameron's and Wenzville's respective ordinances and failed to pay Cameron's linear foot fees. The trial court entered partial summary judgments in favor of the Cities on the issue of liability. After a trial, the court entered a final judgment for the Cities on the issue of damages. The trial court then awarded the Cities attorney fees, prejudgment interest, and postjudgment interest. The Supreme Court reversed in part and remanded the cause, holding that the trial court (1) erred in awarding prejudgment interest to the Cities, and (2) erred in awarding attorney fees to three of the cities. View "City of Aurora, Missouri v. Spectra Communications Group, LLC" on Justia Law

The Colorado Title Board set a title for Proposed Ballot Initiative 2019–2020 #3 (“Proposed Initiative”) that reads, in pertinent part, “An amendment to the Colorado constitution concerning the repeal of the Taxpayer’s Bill of Rights (TABOR), Article X, Section 20 of the Colorado constitution.” The Board also ultimately adopted an abstract that states, regarding the economic impact of the Proposed Initiative. A challenge to the Proposed Initiative was presented for the Colorado Supreme Court's review, and after such, the Court concluded the title and abstract were clear and not misleading, and that the phrase “Taxpayer’s Bill of Rights,” as used in the title, was not an impermissible catch phrase. Accordingly, the Court affirmed the decision of the Title Board. View "In re Proposed Ballot Initiative 2019" on Justia Law

In 2016, Chicago imposed a municipal tax on units of noncigarette “other tobacco products” purchased in the city. Entities with interests in tobacco products sought injunctive relief, arguing that the ordinance was preempted by the Illinois Municipal Code (65 ILCS 5/8-11-6a). The Illinois Supreme Court ruled in favor of the plaintiffs. Section 8-11-6a contains seven specific exemptions to its otherwise broad restrictions on a home rule unit’s power to tax, allowing those units to impose certain taxes on alcoholic beverages, cigarettes, or other tobacco products; motel or hotel rooms; sale or transfer of real property; lease receipts; food prepared for immediate consumption and alcohol sold by businesses that make food for immediate consumption on-site; and other taxes not based on the selling or purchase price or gross receipts from the use, sale, or purchase of tangible personal property. The tobacco products exemption refers to “a tax based on the number of units of cigarettes or tobacco products (provided, however, that a home rule municipality that has not imposed a tax based on the number of units of cigarettes or tobacco products before July 1, 1993, shall not impose such a tax after that date).” The statute allows only those municipal taxes on cigarettes or other tobacco products enacted prior to July 1, 1993. The city’s public policy arguments are better directed to the General Assembly, which has rejected prior requests to amend the statute. View "Iwan Ries & Co. v. City of Chicago" on Justia Law

In this action brought by Great Lakes Minerals, LLC against the State of Ohio and Joseph Testa, the Supreme Court reversed the decision of the circuit court denying Ohio's motion to dismiss, holding that Ohio was protected by sovereign immunity and that Testa was immune from suit in his official capacity as Tax Commissioner of Ohio and that Testa, in his personal capacity, was dismissed based on the principle of comity.Great Lakes sued Defendants seeking a declaratory judgment that it was not subject to Ohio's commercial activity tax, monetary relief for the forced collection of taxes not owed, and a determination that it would be inequitable to require Great Lakes to defend an action in a foreign state. Ohio unsuccessfully moved to dismiss the complaint. The Supreme Court reversed, holding (1) the State of Ohio and Testa in his official capacity were protected by sovereign immunity; and (2) under the principle of comity Testa is dismissed in his personal capacity. View "State of Ohio v. Great Lakes Minerals, LLC" on Justia Law

Plaintiffs, two private citizens and eighteen states, filed suit challenging the individual mandate requirement of the Patient Protection and Affordable Care Act (ACA). The individual mandate required individuals to maintain health insurance coverage and, if individuals did not maintain this coverage, they must make a payment to the IRS called a shared responsibility payment.Plaintiffs argued that the individual mandate was no longer constitutional because: (1) Nat'l Fed'n of Indep. Bus. v. Sebelius, 567 U.S. 519, 538 (2012), rested the individual mandate's constitutionality exclusively on reading the provision as a tax; and (2) a 2017 amendment, which changed the amount of the shared responsibility payment to zero dollars, undermined any ability to characterize the individual mandate as a tax because the provision no longer generates revenue, a requirement for a tax. Plaintiffs further argued that the individual mandate was essential to, and inseverable from, the rest of the ACA and thus the entire ACA must be enjoined.The Fifth Circuit affirmed in part and vacated in part the district court's judgment, holding that there is a live case or controversy because the intervenor-defendant states have standing to appeal and, even if they did not, there remains a live case or controversy between plaintiffs and the federal defendants; plaintiffs have Article III standing to bring this challenge to the ACA because the individual mandate injures both the individual plaintiffs, by requiring them to buy insurance that they do not want, and the state plaintiffs, by increasing their costs of complying with the reporting requirements that accompany the individual mandate; the individual mandate is unconstitutional because it can no longer be read as a tax, and there is no other constitutional provision that justifies this exercise of congressional power; and, on the severability question, the court remanded to the district court to provide additional analysis of the provisions of the ACA as they currently exist. View "Texas v. United States" on Justia Law

Video Gaming Technologies, Inc. (VGT), appeals from the district court's grant of Tulsa County Assessor's motion to dismiss for lack of subject matter jurisdiction. VGT brought a claim for relief from assessment of ad valorem taxes. The Tulsa County Assessor moved to dismiss for lack of subject matter jurisdiction as VGT had not paid the past-due taxes pursuant to 68 O.S.2011 section 2884. The district court granted the motion to dismiss. The Oklahoma Supreme Court determined the underlying question to this case was whether title 68, section 2884 applied to appeals from the Board of Tax Roll Corrections pursuant to title 68, section 2871. The Court concluded title 68, section 2884 did not apply to appeals pursuant to title 68, section 2871: "Timely payment of taxes is not a jurisdictional prerequisite for appeals from orders of the Board of Tax Roll Corrections. The district court erred in finding it did not have jurisdiction." Therefore, the Court reversed the order of dismissal and remanded for further proceedings. View "Video Gaming Technologies v. Tulsa County Bd. of Tax Roll Corrections" on Justia Law

Video Gaming Technologies, Inc. ("VGT") contended the district court improperly granted summary judgment to the Rogers County Board of Tax Roll Collections ("Board"), the Rogers County Treasurer, and the Rogers County Assessor. VGT is a non-Indian Tennessee corporation authorized to do business in Oklahoma. VGT owns and leases electronic gaming equipment to Cherokee Nation Entertainment, LLC (CNE), a business entity of Nation. Nation was a federally-recognized Indian tribe headquartered in Tahlequah, Oklahoma. CNE owned and operated ten gaming facilities on behalf of Nation. The questions presented to the Oklahoma Supreme Court was whether the district court properly denied VGT's motion for summary judgment and properly granted County's counter-motion for summary judgment. VGT argued that taxation of its gaming equipment was preempted by the Indian Gaming Regulatory Act (IGRA) because the property was located on tribal trust land under a lease to Nation for use in its gaming operations. The County argued that ad valorem taxation was justified to ensure integrity and uniform application of tax law. Due to the comprehensive nature of IGRA's regulations on gaming, the federal policies which would be threatened, and County's failure to justify the tax other than as a generalized interest in raising revenue, the Oklahoma Supreme Court found that ad valorem taxation of gaming equipment here was preempted, and reversed the order of summary judgment, and remanded for the district court to enter an appropriate order of summary judgment for VGT. View "Video Gaming Technologies v. Rogers County Bd. of Tax Roll Corrections" on Justia Law

The Supreme Court dismissed this appeal challenging the circuit court's order denying Appellants' motion for summary judgment and granting summary judgment for Appellees, holding that the circuit court's order was not a final order.Appellees filed a class-action complaint against Appellants, online travel companies (OTCs), alleging that the OTCs had failed to collect or collected and failed to remit the full amount of gross-receipts taxes imposed by government entities on hotel accommodations. The circuit court granted partial summary judgment for Appellees on the issue of liability. Appellants appealed. The Supreme Court dismissed the appeal, holding that where the circuit court stated that its order was preliminary and that it was retaining jurisdiction to determine the appropriate relief, and where the court did not enter an Ark. R. Civ. P. 54(b) certification, the order was not final. View "Hotels.com, L.P. v. Pine Bluff Advertising" on Justia Law