This year marks the twentieth anniversary of the U.S. Supreme Court's decision in Quill Corp. v. North Dakota, and the Supreme Court has given every indication that it will not be taking any nexus cases even though many issues still remain unsettled, Maryann B. Gall, of MB Gall Tax in Columbus, Ohio, said at New York University's 31st Institute on State and Local Taxation .
Ms. Gall was one of several tax experts discussing income tax nexus issues, including intangible property, telecommuting employees, and the use of independent contractors performing nonsolicitation activities.
A “big nexus issue that many businesses overlook is telecommuting employees who could create nexus problems,” Laura A. Kulwicki, an attorney at Vorys, Sater, Seymour and Pease in Akron, Ohio, said. Businesses may have longtime employees moving out of state for personal reasons, and the business may decide to allow these employees to telecommute without determining whether there would be a nexus problem. Employee nexus issues can depend on whether the worker is an employee or an independent contractor, said Kulwicki. States are less likely to find income tax nexus if the employee is performing an administrative function, she said. But she pointed out some recent exceptions to this rule.
Experts also addressed cloud computing, noting that states continue to take a checkerboard approach in determining whether sales tax applies to cloud computing, and only recently have buyers, more so than sellers, expressed an interest in the tax consequences of cloud computing issues.
For an in-depth coverage of the state tax highlights addressed at the conference, check out these full text articles by Steven D. Roll, Assistant Managing Editor, State Tax, at Bloomberg BNA, in this week’s issue of the Weekly State Tax Report. [ Intangibles, Telecommuting, Solicitations Top Nexus Issues ; Taxation of Cloud Computing ].
In other developments…
Tax burden for most Americans is lower than in the 1980s , the New York Times reports.
Tax hackers put more states on guard , according to Don't Mess With Taxes.
Weekly Map: Itemized deductions by state , by Nick Kasprak of the Tax Foundation.
Michigan Town Woos Hollywood, but Ends Up With a Bit Part , the New York Times reports.
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