Category Archives: Tax Headlines
Maine ~ Sales and Use Tax: Supplemental Budget Bill Enacts Use Tax Compliance Program, Exempts Machinery and Equipment for Wood Harvesting
Maine Governor Paul LePage has signed a supplemental budget bill that establishes the 2012 Maine Use Tax Compliance Program, exempts certain purchases for commercial wood harvesting, and revises the definition of “commercial agricultural production.” Continue reading
Louisiana ~ Corporate Income Tax: Senate Passes Bill to Expand Single Sales Factor Apportionment
The Louisiana Senate has passed a bill that, if enacted, would extend use of the single sales factor apportionment formula for corporate income and franchise tax purposes to certain qualified businesses. Currently, the single sales factor formula is only available if a business’s income is derived primarily from manufacturing or merchandising. Continue reading
Indiana ~ Corporate Income Tax: Consolidated Returns Not Allowed
A taxpayer, a corporation doing business in Indiana that filed a consolidated corporate income tax return on behalf of itself and two affiliated companies, was not allowed to file consolidated returns because the affiliated corporations lacked activities in Indiana. Further, the taxpayer was not allowed to claim a research expense credit because of lack of evidence. Continue reading
Maximum Mortgage Interest Deduction Halved for Married Taxpayer Who Filed Separate Return; Spouse’s Failure to Deduct Any Interest Irrelevant; Penalty Imposed (Bronstein, TC)
The mortgage interest deduction for a married taxpayer who filed a separate return was limited to the interest she paid on $500,000 of her home acquisition indebtedness, plus the interest she paid on $50,000 of her home equity indebtedness. Although the statute clearly provided that the regular $1 million acquisition and $100,000 home equity debt limits were halved for married-filing-separately returns, the taxpayer argued that this was only to prevent married taxpayers from exceeding those limits by filing separate returns. Since no other obligee on the mortgage claimed any mortgage interest deduction, she claimed that she should be subject to the same limit on qualified residence interest that applied to other returns. However, she presented no evidence to indicate that Congress intended to allow a married couple to apply the $1 million and $100,000 limits to their combined separate returns. Continue reading
Tax Cuts and Tax Reform on Ways and Means To-Do List, Camp Says
The House Ways and Means Committee’s agenda for the remainder of 2012 will be to work on tax reform, extension of the Bush-era tax cuts and passage of the expiring tax extenders, Chairman Dave Camp, R-Mich., said on May 17. Speaking at a legislative policy seminar on tax and budget issues held by Washington-based Federal Policy Group, Camp said tax reform will consist of collapsing the six individual tax rates to just two rates of 10 percent and 25 percent, eliminating the alternative minimum tax and instituting a worldwide system of taxation. “Moving to a territorial system, along with a lower corporate rate, is critical to ensuring that we are an attractive destination for other countries looking for new places to do business,” Camp said. Continue reading