Quitting Quill: State Laws Challenge Quill’s Physical Presence Standard for Out-of-State Tax Collection

By Timothy Yuhasz

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Over the last fifty years, one of the bedrock principles of state and local tax jurisprudence has been the physical presence standard. The rise of E-commerce and a shifting economy, however, have for years called into question its validity. States, too, have taken notice, and new state laws are being crafted that either bypass this requirement or challenge it head-on. It may not be long before the physical presence standard becomes a thing of the past.… Read the rest

The Danger of the Gas Tax: to People, Businesses, and even to the Environment

By: Joe Zender

Representative Earl Blumenauer of Oregon proposed an amendment earlier this year to raise the federal ‘gas tax’ from 18 cents per gallon to 33 cents.[1] While the proposal failed, this 82 percent increase is endemic of the exorbitant gas taxes and increases around the country, both at the federal and state levels. Even as gasoline consumption has leveled off in the U.S., national production of gasoline has increased drastically, leading to lower gas prices.[2][3] Even so, legislatures have moved to increase the burden on each gallon consumed by the taxpayers. The gas tax is now to a point where it unduly burdens businesses, citizens, and even potentially the environment. It should be eliminated and replaced with a more efficient and effective system for funding infrastructure.

The retail cost of a gallon of gasoline across the U.S. on October 1, 2015 was $2.42.[4] At the … Read the rest

Lessons from Hartney: How to Reduce Tax Forum Shopping by Illinois Retailers

            The Illinois’ Local Retailers’ Occupation Tax Acts (ROT Acts) allows “municipal governments and the Regional Transportation Authority (RTA) to impose a retail occupation tax ‘upon all persons engaged in the business of selling tangible personal property at retail within the county, municipality, or metropolitan region.”[i] Leading up to the recent Illinois Supreme Court decision in Hartney Fuel Oil Co. v. Hamer, a number of Illinois retailers with selling activities in multiple jurisdictions sought to pay Illinois Local Retailer Occupation Taxes only in the lowest tax rate jurisdictions where they accepted purchase orders, even when their predominant selling activities occurred in other places.[ii]  This narrow interpretation of the “business of selling” in the ROT Acts complies with the Department of Revenue (DOR) regulations regarding the Acts, which establish a bright-line rule for purchase order acceptances.[iii]

            Although the ability to tax Read the rest

Legal and Tax Considerations for Retirees Choosing a Retirement Destination

There are quite a few factors to consider for seniors facing retirement in the United States.1 While retirees will still owe federal taxes regardless of where they choose to retire, various states’ tax laws will often play at least some role in weighing a retirement destination. For example, some states are especially tough on retirees since, in addition to levying tax on most pensions and other retirement income, they also have high top tax brackets. “Economic security of seniors is being challenged by dramatically increasing expenses, such as for healthcare and housing. These fundamental changes in the lives of older Americans make it not only more difficult for seniors to enter retirement with economic security but also to remain economically secure throughout retirement.” 2

            Since at the time of retirement retirees’ income will most likely be fixed, it is important to take into account various factors which Read the rest

Should Tax Credits as an Incentive for Higher Education be Eliminated?






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One of the biggest contributors to rising disparity in America today is the widening earnings gap between workers with college degrees and those without.[1] Higher education remains a good investment, even though some new grads are currently struggling to get jobs. Over the past two decades, lawmakers have progressively asked the tax code to direct all manner of social and economic objectives (e.g. home buying, adoption, attending college, trading in a clunker for a newer car, etc.). In regards to federal assistance for higher education expenses, tax credits and deductions are relatively new.[2]


Lawmakers have increasingly used tax credits to aid students in covering the cost of college. From 1997 [3], the first year these credits Read the rest

The Non-Deductibility of Juris Doctorate Degree Expenses Under Treasury Regulation 1.162-5


The effects of the recent economic recession and the relatively high unemployment rates that ensued are still felt across the country. According to “The American Workforce,” a survey conducted for The Springboard Project, approximately eight in ten workers, regardless of income or education level, show keen interest in pursuing further training and education.[i][ii] Fortunately, given the relative generosity of the U.S. Tax Code, there are several ways to deduct qualified educational expenses. For example, adults may be able to claim the Lifetime Learning Credit, 20% of the first $10,000 of qualified education expenses, for a maximum amount of $2,000.[iii] However, the income cutoff for Lifetime Learning begins to phase out for singles with modified adjusted gross income above $48,000 and couples above $96,000.[iv] (See IRS Publication 970). Luckily, there’s another option, and the focus of this article, which is deducting educational expenses as Read the rest

Weeding out the Odds: Analysis of Oregon and Washington’s Constitutional Amendments to Legalize Recreational Use of Marijuana



Far away in the backdrop of the 2012 Presidential election, laid a secondary story that would make for primetime headlines on any other given day. That particular secondary story was none other than the states of Colorado and Washington successfully passing constitutional amendments that legalized recreational use of marijuana.  Unlike California and fifteen other states, citizens in Colorado and Washington will not be required to have a medical prescription from a physician to legally possess marijuana.[i] Instead, personal possession of up to an ounce of marijuana will be legal for anyone who is 21 years of age or older.[ii] Though the passing of the law reflects a growing national support for measures that either legalize the drug or aim to reduce the criminal punishments associated with it, federal law still dictates that marijuana is an illegal substance.  Consequently, who wins? Does the argument of … Read the rest

What to Do about the Bush Tax Cuts to Avoid Going Two Steps Forward and One Step Back


I was six years old when my father first told me “there’s no such thing as a free lunch.”  However, as a six year old, I had no concept of money, taxes or other individuals, so this declaration meant nothing to me.  All I cared about was nap time, lunch and recess.  My dad must have been crazy, because as far as I was concerned, some nice lady gave me my lunch every day and it certainly didn’t cost me anything.  However, now as a twenty something, in my seventeenth year of education, I realize that even if something seems free, someone somewhere is paying for it (likely through taxes).  So, thanks dad, for paying for my lunches all those years ago (and my seventeen years of education).  

As 2010 slowly – or quickly – draws to a close, one thought on everyone’s mind is what is going … Read the rest

Temporal Folly in the Creating Small Business Jobs Act of 2010


The Creating Small Business Jobs Act of 2010, Pub. L. No. 111-240, 124 Stat. 2504 (Title II, H.R. 5297) became law on September 27, 2010. The Joint Committee on Taxation (Committee) estimates that the tax provisions will provide $56 billion in relief to small businesses in 2011. Congress had taken a revenue-neutral approach to the relief, much of it in the form of accelerating depreciation on recent investments in capital assets. The Committee gives an in-depth technical explanation of the new provisions, some of which include:


One-year extension of bonus depreciation

Prior to the new law, the fifty percent bonus depreciation deduction on the cost of qualified property investments had expired. Congress has extended the allowance to qualified property acquired and put into service in 2010. This deduction is allowed in conjunction with the otherwise applicable depreciation deduction. The Committee projects that the extension will provide $40 … Read the rest

Provena Covenant Medical Center v. Department of Revenue: The Decision That May End Charitable Exemptions for Nonprofit Hospitals

  I.  Introduction  

The recent decision by the Illinois Supreme Court regarding tax exemption for hospitals is troubling for the already volatile and uncertain future of many hospitals that are facing increasing difficulties in the current economic market.  The Illinois Supreme Court held that Provena Medical Center in Urbana does not provide enough charity care to qualify for the tax exemption provided for hospitals that care for uninsured and poor patients without generating a profit or collecting fees.[1]  The decision has generated significant criticism for relying on old precedent, failing to take into account current economic conditions, and for failing to provide clear guidelines for nonprofit hospitals that want to qualify for tax exemption in Illinois.[2]  The implications of this decision while not precisely known can have wide ranging consequences for hospital financing and access to healthcare for low income and uninsured Read the rest