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Showing 7 posts in Corporate Income Tax.

Tax Court Decision Highlights the Risks of Sending Your Tax Documents to the IRS Via Regular U.S. Mail

Mailing in W2 FormFor businesses and individuals, preparing tax-related documents required by the Internal Revenue Service (IRS) or United States Tax Court can be a complex process, often requiring the assistance of outside advisors such as attorneys and accountants. As a recent case in the Tax Court demonstrates, the last, seemingly simple step in the process—filing a tax document —should not be taken lightly. Indeed, all of the analysis and number-crunching that goes into a tax document could be for naught if a document isn’t delivered before the relevant deadline. Read More ›

Categories: Corporate Income Tax, Income Tax, Tax, Tax Disputes

Michigan Department of Treasury Sheds Light on Nexus Standards Related to Michigan Business Taxes

Some businesses are (unpleasantly) surprised when they learn they are responsible for taxes -such as sales and income taxes - in states in which they have no physical presence. What gives rise to liability in these situations is “economic nexus,” which relates to a business’ activity, such as the generation of sales without a physical presence, in a state. Nexus, therefore, can be a hidden trap for businesses with multistate sales and other activities, particularly because what gives rise to nexus is often uncertain and unexplained by a state’s taxing authority.

Michigan Department of Treasury (the “Treasury”) has shed light on what constitutes nexus in Michigan through the issuance of a release that explains the nexus standards for Michigan business taxes. The release (the “Release”) addresses the sales and use tax presumption for out-of-state sellers; the nexus standards for the corporate income tax; and the nexus standards for flow-through entity withholding. Read More ›

Categories: Corporate Income Tax, News & Events, Sales Tax, Use Tax

Auditing the Auditor: Microsoft Files for Information about Tax Law Firm

AuditorMicrosoft Corporation is seeking transparency. On Nov. 24 the company filed a complaint in federal court under the Freedom of Information Act, demanding that the Internal Revenue Service disclose information about its contract with a law firm tied to audits of the software maker. 

At issue in Microsoft Corp. v. Internal Revenue Service (Case 14-cv-01982, U.S. District Court, District of Columbia) is Microsoft’s request for access to the complete government contract between the IRS and Quinn Emanuel Urquhart & Sullivan LLP, the firm contracted by the IRS to examine federal income tax returns for years 2004 through 2009.  

Microsoft submitted a public records request on Sept. 22 seeking information on the $2.2 million contract entered into in May, according to the filing. To date, the IRS hasn’t disclosed and is unlawfully withholding the records, according to Microsoft. Read More ›

Categories: Corporate Income Tax, Tax

Annual Federal Reporting and Filing Obligations of Tax Exempt Entities

Who Must File?

Virtually all tax exempt entities must file an annual return with the IRS. In fact, the presumption is that a tax exempt organization must file unless they fit into one of the IRS's limited exceptions. Several exemptions apply to certain religious organizations, political organizations, and others.

What Must be Filed?

There is no single form common to all tax exempt organizations, but all will file one of the "990-Series Return" forms, including Forms 990, 990-N, 990-EZ, or 990-PF. Supplemental information may be required through any one or more of Schedule A through R too. In general, tax exempt organizations incurring gross receipts less than $50,000 will file Form 990-N, also known as the "e-Postcard." Organizations that do not qualify to use Form 990-N, but who incur gross receipts less than $200,000 and have less than $500,000 in total assets may file either Form 990 or 990-EZ, while those with receipts or assets equal to or greater than the previously mentioned benchmarks must file Form 990. Finally, private foundations must file Form 990-PF regardless of financial status. Read More ›

Categories: Corporate Income Tax, Tax-Exempt Organizations

Tribunal Holds that Bankruptcy Does Not Discharge Officer's Personal Liability for Unpaid Taxes

Certain officers may be personally liable for the unpaid taxes of a Michigan business.  MCL 205.27a(5) imposes personal liability on those officers with tax paying responsibilities if a business fails to file a return or pay a tax due. As a general matter, an officer has "tax paying responsibilities" if he signs returns, files returns, or has the power to direct others to file returns or pay taxes. Read More ›

Categories: Corporate Income Tax

Treasury Form 4913 for Quarterly Corporate Income Tax Payments

The Corporate Income Tax (“CIT”) took effect on January 1, 2012 and replaced the Michigan Business Tax (“MBT”) for most taxpayers, except those electing to continue the MBT to claim certain credits.  The CIT consists of a franchise tax for financial institutions, a premium tax for insurance companies, and a flat 6% income tax for C Corporations and entities taxed as C Corporations for federal income tax purposes. As discussed in prior blog postings, the CIT does not apply to pass-through entities, such as LLCs or partnerships. Read More ›

Categories: Corporate Income Tax, Income Tax

Proposed Corporate Income Tax Credit For Hiring Veterans

corporate income tax creditIn 2011, the Michigan Corporate Income Tax ("CIT") was signed into law.  The CIT repealed the Michigan Business Tax and replaced it with a flat 6% tax on businesses that are taxed as C corporations for federal income tax purposes. Read More ›

Categories: Corporate Income Tax, Income Tax