Hodgson Russ SALT Dispatch

In a decision with significant implications for the sales taxation of artwork, the New York Tax Appeals Tribunal ruled on February 28 that a $7 million painting (at least a one-half share in the painting) was validly acquired for resale resulting in a six-figure sales tax refund for a co-owner of the painting.  Tribunal decisions on sales tax are significant in their own right, since they are somewhat rare and (as opposed to administrative law judge rulings) they become binding precedent.  But the Objet LLC ruling should have particular relevance to the art industry since it tackles two issues that factor prominently in the high-stakes sales and related tax structuring that occur in the industry:  one being the form-over-substance nature of sales tax, and the other being the proper analysis for determining when property is purchased “exclusively for resale”.

The energy-storage industry has seem a surge in the past few years—driven in part by the growth in renewable energy sources and production from those sources.  But while sales tax incentives in New York have boosted other sectors of the energy industry, the energy-storage industry is still on the outside looking in.  That could change, however, based on New York State legislation introduced in April that would provide a broad sales tax exemption for both commercial and residential energy-storage systems.