News & Publications
In Case You Missed It: Last Week in Allyn Tax News (August 9-13)
New York Refund Denial Upheld
An administrative law judge (ALJ) has issued a decision to uphold the Division of Taxation’s denial of a taxpayer’s refund claims associated with motor fuel tax, petroleum business tax, and prepaid sales tax on 13,838,236 gallons of motor fuel.
The ALJ concluded that the taxpayer was not entitled to a refund because it has not demonstrated that it paid for the fuel at issue.
Performing a reverse tax audit, otherwise known as a “refund claim”, can be a rewarding way for companies to identify and recover overpaid sales and use taxes. The word “audit” may be received with negative feelings within some companies and perhaps reflected upon with frustration and avoidance. However, performing a reverse tax audit may be an opportunity for your business to get paid for being compliant.
Alabama Town of Oak has Repealed its Sales, Use, and Rental Tax
The Alabama Department of Revenue has issued a notice to all retailers in the Town of Oak Grove’s police jurisdiction directing all collection of the city’s sales, use, and rental tax to be discontinued effective July 1st.
Retailers of tangible personal property in the Town of Oak Grove will no longer be required to collect sales, use, and rental tax in the police jurisdiction (which is located in Talladega County). Retailers are encouraged to carefully review their sales data and ensure that these taxes are not being collected/remitted.
Illinois Uniform Unclaimed Property Law Now Includes Cryptocurrency
Effective August 6th, 2021, Illinois law amended its definition of virtual currency to mean any type of digital unit, including cryptocurrency, used as a medium of exchange, unit of account, or a form of digitally stored value, which does not have legal tender status recognized by the United States.
Currently, virtual currency is considered unclaimed 5 years after the last indication of interest in the property. After 5 years, the holder of the virtual currency must liquidate the virtual currency and remit the proceeds to the administrator. The liquidation will occur anytime within 30 days prior to the filing of the report.
What Hawaii Wants You to Know Before Making Sales of Software in the State
The Hawaii Department of Taxation (HDOT) has issued guidance for the application of the general excise tax (GET) on sales of software. The sale of prewritten or canned software is a sale of tangible personal property, regardless of how the software is delivered.
Sales of tangible personal property are subject to GET at the retail rate of 4%; however, a wholesaler of tangible personal property is subject to GET at the wholesale rate of 0.5%. If prewritten or canned software is sold or licensed by a taxpayer to a licensed seller for subsequent resale or licensing, the transaction may qualify for the wholesale rate.
If software is sold or licensed through a marketplace facilitator, the marketplace facilitator is deemed to be the retail seller and subject to GET at the retail rate of 4%. The marketplace seller, on whose behalf the sale or licensing of the software is made, is deemed to have made a sale at wholesale
Can Bundled Transactions Be Hurting Your Business?
Tennessee recently issued a letter ruling discussing the consequences of bundling taxable and nontaxable items in a single contract. Tennessee law states that if a single item of a bundled contract is taxable and sold for one non-itemized price, then the whole transaction will be taxable.
From a business perspective, bundled transactions can make sense in order to appropriately advertise and sell products as well as to increase revenue. Also, bundled transactions can reduce the administrative burden of itemizing each product in a sale and separately determining and applying sales tax. Businesses should be aware of the tax complications that may occur due to incorrectly classifying a bundled transaction and seek professional help if the taxability is unclear.
How Can We Help?
Allyn’s tax team is staffed with seasoned tax professionals experienced in all aspects of Federal, multi-state and local tax compliance and consulting for large US and global corporations. We use that experience to your advantage.
Here at Allyn, we pride ourselves on our ability to always “stay on top of it”. We use the latest in tax software and create a unique, rigorous process for each and every client’s needs, ensuring that nothing slips through the cracks. Our team is equipped to assess in-advance and quickly resolve all tax issues that a business may encounter, allowing our clients to confidently focus on what they do best.
Allyn Tax offers a full scope of corporate tax services across North America, encompassing business tax compliance and consulting, audit defense and support, nexus reviews and registrations, exemption certificate management, overpayment reviews, and mail processing solutions.
Contact us and we can provide a customized cost-effective solution to meet your company’s needs. For further information on Allyn Tax services, please contact: firstname.lastname@example.org.
For More Information
If you are interested in learning more about this topic or other tax topics, please visit our Tax Publications under News & Publications at www.allynintl.com.
Contributor: Courtney Sboro
About Allyn International
Allyn International is dedicated to providing high quality, customer centric services and solutions for the global marketplace. Allyn's core products include transportation management, logistics sourcing, freight forwarding, supply chain consulting, tax management and global trade compliance. Allyn clients range from small local businesses to Fortune 500 firms. Allyn conducts business in more than 20 languages and has extensive experience in both developed and emerging markets. Highly trained experts are positioned throughout North and South America, Europe and Asia. Allyn’s regional headquarters are strategically located in Fort Myers, Florida, U.S.A., Shanghai, P.R. China, Prague, Czech Republic, and Dubai, U.A.E. For more information, visit www.allynintl.com.