About This Blog
Sales tax is one of the most interesting, and challenging, taxes. It’s interesting because it involves clients in every possible industry. Every active business has potential sales tax exposure, no exceptions! And unfortunately sales tax compliance is particularly difficult for two, specific reasons. First, the tax is perhaps the most fact-dependent – seemingly inconsequential changes in the underlying facts can transform a nontaxable sale into a taxable one. Second, these rules are constantly changing. It’s tough enough to keep up with these changes in just one state. But many vendors, especially those selling over the internet, have to keep abreast of these changes in multiple states. So it’s easy to fall behind on sales tax compliance.
With this blog, we hope to keep you up to date on impactful changes in the sales tax compliance, especially in New York State. We’ll review legislative and administrative changes in the sales tax; we’ll discuss new sales tax case law; and we’ll highlight the enforcement initiatives and tactics we’re seeing while defending businesses in sales tax audits. We hope you find this content as interesting as we do. Please contact us with any questions.
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Sales Tax Cases from the TiNY Blog for September 28, 2023
Here are the sales tax cases from the TiNY Blog for the week of September 28, 2023.
ALJ Determinations:
Matter of Uddinzaman, SALJ Gardiner (August 24, 2023); Div’s Rep. Karry Culihan, Esq.; Pet’s Rep. pro se; Articles 28 and 29.
Matter of Piacquadio, ALJ Behuniak (August 24, 2023); Div’s Rep. Bruce Lennard, Esq.; Pet’s Rep. Scott Ahroni, Esq.; Articles 28 and 29.
Petitioner was found to have been a responsible office of the Eden Ballroom LLC, and therefore liable for its sales tax underpayments. Petitioner was a member of the LLC and active in its management. As such he was a responsible person per se. In addition, he exercised many of the management prerogatives that indicate a responsible officer. Thus, even if he were not an LLC member, he would nonetheless be a person responsible for the sales tax obligations of the Eden Ballroom LLC.
Matter of Seneca, ALJ Behuniak (August 24, 2023); Div’s Rep. Bruce Lennard, Esq.; Pet’s Rep. Scott Ahroni, Esq.; Articles 28 and 29.
Petitioner was determined to be a responsible officer of Eden Ballroom LLC for only a portion of the tax periods at issue. Even though he mistakenly signed certain documents as “managing member,” he provided sufficient evidence that he was not, in fact, a member of the LLC. In addition, third-party affidavits showed that for some of the tax periods at issue he did not exercise most of the other management prerogatives that would result in his being a responsible person. For those periods, it was determined Petitioner was not liable for the sales taxes owed by the LLC. However, for the periods outside of the coverage of the affidavits, Petitioner did not provide sufficient evidence to disprove that he was a responsible officer of Eden Ballroom LLC. Of note: If you think it unusual that the same attorney would represent two petitioners taking the position that they were not responsible officers of a particular business, you are not alone.
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