KPMG reports - Alabama (sales tax); Illinois (retailer occupation tax); Indiana (apportionment); Texas (apportionment) 

January 27: KPMG’s This Week in State Tax—produced weekly by KPMG’s State and Local Tax practice—focuses on recent state and local tax developments and features a series of short podcasts presented by KPMG tax professionals. Text of the podcasts is also available.

This week’s edition includes the following topics (listen to the podcasts; to read text, click on the links below).

  • Alabama - The Alabama Court of Civil Appeals, in reversing a trial court’s decision for the taxpayer, held that an Alabama corporation with multiple out-of-state locations was not entitled to a refund of sales tax on tractors purchased from a dealer in Alabama, even when certain tractors were intended for out-of-state use. The taxpayer had accepted and titled the tractors in Alabama.

  • Illinois - The Illinois Department of Revenue filed both emergency and proposed permanent rules addressing how receipts from sales of taxable goods are to be sourced for local retailer’s occupation tax (ROT) purposes. These rules were issued in response to an Illinois Supreme Court decision invalidating the ROT-sourcing regulations (read TaxNewsFlash-United States (December 2, 2013)).

  • Indiana - The Indiana Department of Revenue concluded that a taxpayer and related entities were required to file a combined return and use an alternative apportionment factor—i.e., the “audience factor” apportionment method. The Department found the companies were interdependent and relied upon each other in the production, acquisition, and distribution of cable and satellite programming, and that the parent company’s revenue was directly linked to the number of Indiana subscribers that purchased the companies’ content.

  • Texas - A Texas district court judge, in a two-paragraph order, granted partial summary judgment for the Comptroller, thus determining that the taxpayer could not elect to use the Multistate Tax Compact’s allocation and apportionment provisions in computing Texas franchise tax liability.

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