Category Archives: State and Local Tax

Avoiding Massachusetts Taxation After the Bank of America Case: What Works and What Doesn’t Work

Massachusetts families of means often establish trusts with Massachusetts resident fiduciaries for the benefit of unborn and unascertained beneficiaries. Later, some of these families leave Massachusetts and reestablish themselves as domiciliaries and residents of other states or even foreign countries. Their unborn children and unascertained beneficiaries may never become Massachusetts ...

Use State Voluntary Taxpayer Disclosure When Complying with Expanded Nexus

I. Introduction

Over the past 25 years new types of expanded non-physical nexus have come to be recognized. These types of expanded nexus are:
  • Economic Nexus: Income Taxes
  • Click-Through or Agency Nexus: Sales Taxes
  • Affiliate and Attributional Nexus: Sales Taxes and Income Taxes
Failing to comply with those expanded nexus standards can be ...

The Power of Voluntary Taxpayer Disclosure

Today the Boston Globe reported that PTC, Inc. (“PTC”) voluntarily disclosed that its Chinese subsidiaries allegedly provided about $1.5 million in bribes to foreign officials over a period of five years (from 2006 through 2011) in violation of the United States Foreign Corrupt Practices Act. PTC is a publicly held ...

State Voluntary Taxpayer Disclosure Programs: An Overview

State Voluntary Disclosure Programs: An Overview[1]

By Attorney Morris N. Robinson, CPA, LLM[2]

What is Voluntary Disclosure? Most state departments of revenue[3] allow certain categories of noncompliant taxpayers to come forward voluntarily and pay taxes accrued during a limited lookback period.[4] Taxpayers ...

Flynn v. Commissioner of Revenue: What Are the Prerequisites for a Massachusetts Tax Appeal?

Recent decisions by the Massachusetts Appellate Tax Board (ATB) illustrate that a taxpayer must fulfill three prerequisites in order to obtain ATB jurisdiction in tax appeals against the Commissioner of Revenue:
  • File all required tax returns.
  • File a Form CA-6: Application for Abatement, with the Department of Revenue. The CA-6 filing
  • ...

    Amnesty for Massachusetts Non-Filers Might Occur in 2016

    Taxpayers who failed to file their Massachusetts income tax returns, or who underreported their income, might be given a two-month window in April and May 2016 to enter into a tax amnesty program.  The program is still in the planning stages.  It has not yet received final approval, and details ...

    The Bank of America Case: May Massachusetts Tax the Trust Fund Income of Non-Resident Families with Unborn and/or Unascertained Members?

    Background  Before addressing the Bank of America case,[1] it is necessary to understand the Massachusetts taxation of trustees and their beneficiaries, which is described in 830 CMR 62.10.1: Income Tax on Estates and Trusts (the “Regulation”).  Massachusetts Jurisdiction to Tax Trusts When dealing with jurisdiction to tax, the Regulation distinguishes between testamentary trusts and inter vivos trusts, as follows:

    MassTaxConnect: Massachusetts Business Taxpayers and Tax Professionals Await Rollout of New Secure Website on November 30, 2015

    The Massachusetts Department of Revenue (“DOR”) released a training video about MassTaxConnect, the new secure website for tax administration in Massachusetts, on September 18, 2015. MassTaxConnect is scheduled for a rollout on Monday, November 30, 2015—the first business day after Thanksgiving.

    How Taxpayers Are Identified for the Massachusetts Domicile Audit

    Every year hundreds of former Massachusetts residents are selected for a Department of Revenue domicile audit. It is very easy to be selected for audit. Former Massachusetts residents with high incomes and net worths are particularly vulnerable. How are these taxpayers identified for audit? Perhaps the most important Department of Revenue ...

    Making the Move from Massachusetts: Changing Your Domicile May Prove Challenging

    Labor Day will soon be upon us and with that a change of seasons here in Massachusetts. While it’s not quite time to take out the winter woolies, the dismal 2016 winter weather predictions for the Northeast may have already prompted you to order a new snow blower ahead of ...