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Illinois Qui Tam Update: Where is the False Claim? Where is the Fraud?06/17/2015

Sadly, most qui tam defendants make the unappealing business decision to settle by paying extortion dollars, rather than having to proceed all the way to trial. Hopefully the State will step in to help soon or some positive legislation will pass, so this trend will …

City of Chicago Issues Guidance Regarding the Applicability of the Amusement and Transaction Taxes to Electronic Transactions06/12/2015

On June 9, 2015, the Chicago Department of Finance (“Department”) issued two rulings regarding the City’s Amusement Tax and the Personal Property Lease Transaction Tax. The rulings are intended to clarify the City’s position on when electronically delivered amusements or services will be subject to …

Illinois Qui Tam Update: April Brings Blows to the Whistleblower – But Will It Continue?05/06/2015

The month of April (2015) brought us two of the more significant updates in the 10-year history of the Stephen B. Diamond (“Diamond”) whistleblower lawsuits, filed under the Illinois False Claims Act (the “Act”), 740 ILCS ?175/1et seq…

State Tax Developments for Pass-Through Entities: Apportionment of Income for Corporate Partners03/17/2015

State taxation of corporate partners in multistate partnerships raises interesting issues. In many circumstances, the corporate partner is subject to multistate taxation and is therefore engaged in the process of allocating and apportioning its income on a multistate basis. The difference between allocating and apportioning …

Myths and Considerations Regarding Market Based Sourcing02/18/2015

This is the myth that states are touting these days: market based sourcing is more easily administered and it levels the playing field between in-state and out-of-state businesses. A flood of states are jumping on the bandwagon. In the past week alone, the Tennessee and …

Airbnb Voluntarily Agrees to Collect and Remit Hotel Taxes in D.C. and Chicago02/02/2015

Airbnb Inc. (“Airbnb”) announced January 28 that it has voluntarily agreed to collect and remit hotel taxes in the District of Columbia and Chicago.

The Transferability and Monetization of Tax Credits01/28/2015

State tax credits have been in existence since the 1980s and can be found in 46 states. The credits offer a "dollar-for-dollar reduction" of a taxpayer's tax liability. However, the problem encountered early on in the promotion of these credits was what to do if the credit could not be fully utilized by the taxpayer. Transferability allows tax credits to remain attractive to…

Tax Deficiencies and Automatic Penalties: Challenging by Reasonable Cause?12/12/2014

Increasingly, taxpayers are seeing the imposition of penalties on deficiency assessments. In fact in a number of situations the imposition of the penalty is automatic upon the issuance of the assessment. The penalties, which may range from 20% to 25% of the liability, are imposed …

If at first you don’t succeed, try, try again.11/13/2014

The City of Chicago imposes an amusement tax (?Amusement Tax? or ?Ordinance?) on the patrons of any amusement within Chicago based on ?the admission fees or other charges for the privilege to enter, witness, view or participate in the amusement.? Municipal Code of Chicago (?M.C.C.?) …

Maryland v. Wynne: Sammy Sosa’s Revenge?11/05/2014

Some have called it the most important state and local tax case that the United States Supreme Court has heard in 20 years. The case is Maryland v. Wynne and it concerns the extent to which a state must provide credits for taxes paid to …

It’s about time. Hopefully this trend continues.11/04/2014

On October 23, 2014, Judge Mulroy, a Cook County Circuit Court judge, ruled against Schad, Diamond & Shedden, P.C. ("Diamond") in one of the hundreds of qui tam tax cases that Diamond currently has pending before him. During a two-day bench trial in August, National Business Furniture's financial officers said they had relied on a completed Illinois Department of Revenue…

Taxpayer Bills of Rights and Alternative Apportionment10/22/2014

The applicability of the Tennessee Taxpayer Bill of Rights to the Vodafone decision is not unique. In many cases, departments of revenue invoke alternative apportionment at a later stage than taxpayer bills of rights permit. Taxpayers should be wary of such treatment, and consider whether …

Quinn Signs the Illinois Amazon Tax into Law08/28/2014

Quinn signed into law the Illinois “Amazon tax” that requires the online retailer with affiliates in Illinois to collect a ?use tax? for all sales to Illinois customers. Illinois’ first attempt at an Amazon law was struck down by the Illinois Supreme Court under the …

Taxing and Legitimizing the Sharing Economy08/26/2014

The so-called ?sharing economy? has recently gained a lot of steam. This model, which helps owners of nascent high value assets pair up with possible users of those assets, has been cited among the most dynamic and exciting types of start-ups over the past few …

Michigan IBM Decision May Provide More Opportunities Than the 3-Factor Election08/12/2014

On July 14, 2014, the Michigan Supreme Court ruled in IBM v. Department of Treasury, Docket No. 146440, that the taxpayer, IBM, was entitled to a refund of income taxes paid to the state by virtue of its election to apportion its income using the …

A Taxpayer Conundrum07/25/2014

What do Papa John?s Pizza, delivery charges and whistleblower lawsuits have in common? When it comes to state sales tax, a lot as it turns out.

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