Cover Your SaaS - Issue IIJune 22, 2020
Welcome to the second edition of Cover Your SaaS, your new favorite(ish) semi-regular publication from HMB Legal Counsel’s State & Local Tax team. Far from accepting a sophomore slump, this edition boldly delves into SALT developments in the digital products sphere, the importance of separately stating charges, and the dangers of straying into taxable telecommunications.
Cover Your SaaS: A Semi-Regular Publication on State and Local Tax Developments in the Cloud Computing and Digital Space - 4/10/20April 10, 2020
Welcome to the first edition of Cover Your SaaS, a new semi-regular publication from HMB Legal Counsel’s State & Local Tax team. Using the latest in news-scanning technology, i.e., the daily emails that land in our inbox, our goal is to keep you updated on key SALT developments in the digital and cloud computing space.
Illinois House Bill Requires Public Corporations with Principal Executive Offices in Illinois to Report to Secretary of StateJanuary 7, 2020
House Bill 3394, approved by the Governor on August 27, 2019 and effective immediately (Public Act 100-589), amends the Business Corporation Act of 1983 (“BCA”) to add new Section 8.12 and amend Section 14.05.
Applying the Chicago Lease Transaction Tax to “Cloud” Software ProductsSeptember 11, 2019
In a prior post, I explained the basics of the Chicago Personal Property Lease Transaction Tax (“Transaction Tax”), including the applicability of the tax to tangible personal property and software, potentially applicable exemptions and exclusions from the tax, and collection issues. This follow-up post in the Practitioner Series further clarifies the application of the Transaction Tax to “cloud” software products and explores the interplay with the Illinois Retailers’ Occupation Tax (“ROT”).
Cook County Taxes: Parking Lot and Garage Operations TaxDecember 11, 2018
The "Parking Lot Tax" has recently been targeted by the Cook County Department of Revenue. In the past 3-5 years, we have seen a significant uptick in the Department's audit activity, and challenges to Taxpayer positions. Their efforts have primarily focused on the enforcement of its Amusement, Tobacco, and Gasoline and Diesel Taxes. However, more recently, the Department has turned its attention to its Parking Lot Tax.
Illinois' Unique Treatment of Leases and Traps for the Unwary LessorMay 22, 2018
Illinois? treatment of leases is an anomaly when compared to almost all other jurisdictions. While most jurisdictions impose sales tax on the lease receipts collected from the lessee, the user of the equipment, Illinois differs by treating the lessor as the user of the equipment. As such, the lessor is subject to Illinois use tax.
Navigating a Cook County Department of Revenue Audit and the Procedure for a Formal ProtestApril 17, 2018
A recent national trend in the practice field of state and local tax has been the uptick in local jurisdictions' audit activity. The Cook County Department of Revenue has taken aggressive positions in the interpretation of its tax ordinances which has led to increased litigation in the administrative proceedings before the Cook County Department of Administrative Hearings. This post provides an overview of the Department's audit and ensuing D.O.A.H. processes and will highlight some of the procedural differences compared to other jurisdictions such as Chicago and Illinois.
What Illinois Auto Dealers, Financial Institutions and other Lessors Need to Know About Taxing Post Lease ChargesMarch 12, 2018
Three years ago, Illinoisans cheered the changes to the motor vehicle leasing law that were to lead to tax savings for lessees and level the playing field with other state's leasing laws. Now, as the first wave of three-year leases comes to an end, lessors can no longer afford to overlook these changes regarding the post-lease charges.
City of Chicago Department of Finance Changes the Terms of its Voluntary Disclosure ProgramDecember 14, 2017
With no formal announcement it appears that the City of Chicago Department of Finance (?City?) has changed the terms of its voluntary disclosure program (?VDA Program?).
The Cubs Won the World Series and Illinois Finally Has a Budget!July 7, 2017
Today marks the first time in over two years that Illinois will be operating under a budget. This is a result after the House voted to override Governor Rauner?s veto of Senate Bill 9. The House garnered the necessary votes to end the two year stalemate full of political puffery and sparring. Some of the relevant changes that Illinois? taxpayers should be aware of are noted below. All changes are effective July 1, 2017, unless otherwise noted.
If at First You Don't Succeed, Try, Try AgainNovember 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.?) ? 4-156-020. The tax is nine-percent (9%) of the ?admission fees or other charges.? M.C.C. ? 4-156-010. But is this tax legal?
It's About Time--Hopefully This Trend ContinuesNovember 4, 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…
Quinn Signs the Illinois Amazon Tax into LawAugust 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 U.S. Constitution?s Supremacy Clause, which prohibits States from passing laws that conflict with federal law. Illinois? original affiliate tax fell because it directly conflicted with the Internet Tax Freedom Act, a federal law that prohibits discrimination against electronic commerce...