While 2019 was a busy year in state and local tax (SALT) world, 2020 promises to be just as eventful. With cases pending in various courts dealing with personal income taxes and corporate income taxes, there’s exciting SALT news on the horizon for almost everyone.
- Steiner v. Utah State Tax Commission, No. 20180223, 08/14/2019: A refund opportunity for taxpayers with taxes paid to foreign countries.
In a controversial opinion entered during 2019, the Utah Supreme Court held that the dormant commerce clause did not require Utah to grant credits for taxes paid by individuals to foreign jurisdictions and declined to extend the U.S. Supreme Court’s ruling in Comptroller of the Treasury of Maryland v. Wynne, 575 U.S. ___ (2015), to the issue. Steiner arose out of Robert and Wendy Steiner’s Utah joint income tax returns, particularly the taxation of Robert Steiner’s business income. Robert Steiner was a shareholder of an S corporation (Steiner LLC) and a beneficiary of the G.A. Steiner Trust, which was Steiner LLC’s majority shareholder. Steiner LLC was the only shareholder of Alsco Inc., a textile rental company that generated income from business in both U.S. and foreign locations. Alsco and its subsidiaries were taxed as qualified S subsidiaries, as such all income from those subsidiaries ultimately passed through to Steiner LLC’s shareholders, including Robert Steiner.
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