Diann Smith
Subscribe to Diann Smith's PostsDiann Smith focuses her practice on state and local taxation and unclaimed property advocacy. Diann advises clients at any stage of an issue, including planning, compliance, controversy, financial statement issues and legislative activity. Her goal is to find the most effective method to achieve a client's objective regardless of when or how an issue arises. Diann emphasizes the importance of defining a client's objective - whether it is finality of a frequently audited issue, quick resolution of a stand-alone tax liability, or avoiding competitive disadvantages in the application of a tax. The defined objective then governs the choice of the path to a solution. Read Diann Smith's full bio.
Good News for SALT Taxpayers? Supreme Court Overturns Federal Agency Deference
By Stephen P. Kranz, Diann Smith and Michael J. Hilkin on Jun 28, 2024
Posted In Nationwide Importance
On June 28, 2024, in Loper Bright Enterprises v. Secretary of Commerce, the Supreme Court of the United States ruled to overturn its four-decade-old decision in Chevron USA Inc. v. Natural Resources Defense Counsel. While the Loper case addressed deference to administrative agencies under the federal Administrative Procedure Act (APA), its outcome may give state...
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Microsoft Scores Massive Win in California, Opens the Door for Others Nationwide
By Stephen P. Kranz, Diann Smith and David Jasphy on Mar 15, 2024
Posted In Allocation/Apportionment, California, Federal Tax, Income Tax, Nationwide Importance, Tax Base
The Office of Tax Appeals (OTA) handed Microsoft an enormous win in its controversy with the California Franchise Tax Board (FTB) over the inclusion of qualifying dividends in the sales factor denominator for which it also claimed a dividends received deduction (DRD). Microsoft filed a water’s-edge combined report for the years at issue and deducted...
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As Minnesota Moves Toward GILTI Taxation, New Jersey May Be Moving Away from It
By Stephen P. Kranz, Michael J. Hilkin and Diann Smith on May 23, 2023
Posted In Allocation/Apportionment, Federal Tax, Income Tax, Minnesota, Nationwide Importance, New Jersey, Tax Base, Unitary Business
We previously reported that the Minnesota Legislature was considering imposing mandatory worldwide combined reporting through an omnibus tax bill. Subsequent to our report and in the face of numerous criticisms, Minnesota Senate leaders backed away from the proposal. But ominously, those same leaders said they would examine other tax increases to make up for the...
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Be Careful What You Wish For: Minnesota May Be on the Precipice of Enacting Worldwide Combined Reporting at the Worst Possible Time
By Stephen P. Kranz, Michael J. Hilkin and Diann Smith on May 4, 2023
Posted In Federal Tax, Income Tax, Local Tax, Minnesota, Nationwide Importance, Tax Base, Unitary Business
It has been widely reported that the Minnesota Legislature has advanced an omnibus tax bill that would require the inclusion of the “entire worldwide income” of combined corporate income tax filers engaging in a unitary business. Tax press outlets have made the broad claim that mandatory worldwide combined reporting will “add foreign subsidiaries’ profits” to...
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Meaningful Statute of Limitations for Unclaimed Property Audits and Enforcement Actions? Michigan Court of Appeals Says Yes!
By Eric D. Carstens, Stephen P. Kranz and Diann Smith on Mar 10, 2023
Posted In Audits, Michigan, Nationwide Importance, Procedure, Unclaimed Property
On January 19, 2023, the Michigan Court of Appeals affirmed two 2022 trial court orders, holding that initiating an unclaimed property audit does not toll (or freeze) the running of the statute of limitations (time-bar) for the Michigan State Treasurer to commence “an action or proceeding” with respect to a duty of a holder.[1] As...
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Tax That DC?!?! FCA Suit on Residency Brings Business Intelligence Company into the Crosshairs
By Eric D. Carstens, Stephen P. Kranz, Michael J. Hilkin and Diann Smith on Sep 2, 2022
Posted In Constitutional Issues, District of Columbia, False Claims Act, Income Tax, Local Tax, Nationwide Importance, Tax Base
For the first time since the enactment of the False Claims Amendment Act of 2020, the DC Attorney General’s (AG’s) Office has used its new tax enforcement powers to pursue an alleged personal income tax deficiency. This development brings to the forefront a long-simmering constitutional problem with DC’s statutory residency law and offers a stern...
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“Voluntary” in Name Only? New Jersey Introduces Transfer Pricing Initiative
By Stephen P. Kranz, Diann Smith and Michael J. Hilkin on Jun 16, 2022
Posted In Audits, Income Tax, Interest and Penalties, New Jersey, Transfer Pricing
The New Jersey Division of Taxation (Division) has announced a “voluntary” transfer pricing initiative beginning June 15, 2022, and continuing through March 2, 2023. According to the Division, the initiative is targeted toward companies that have intercompany transactions that would be subject to transfer pricing adjustment. The initiative is broadly available to taxpayers with related...
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False Claims Act Risk for Unclaimed Property Holders
By Diann Smith, Stephen P. Kranz and Eric D. Carstens on Mar 15, 2021
Posted In False Claims Act, Nationwide Importance
In what has become an unfortunate trend, unclaimed property holders continue to be subject to lawsuits under state false claims acts (FCA – also called a qui tam or whistleblower action) for alleged underreporting and remittance of unclaimed property obligations. More than 30 states have a false claims act with whistleblower provisions and nearly all...
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DC Council Expands False Claims Act to Tax Claims
By Stephen P. Kranz, Diann Smith and Eric D. Carstens on Dec 1, 2020
Posted In District of Columbia, False Claims Act, Nationwide Importance
The DC Council has passed an amended bill (the False Claims Amendment Act of 2020, B23-0035) that beginning as early as January 2021 will allow tax-related false claims to be raised against large taxpayers for up to 10 years of prior tax periods! This troubling legislation creates a real and imminent possibility of prior tax...
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False Claims Act Tax Expansion Bill Advanced by DC Council
By Stephen P. Kranz, Diann Smith and Eric D. Carstens on Nov 17, 2020
Posted In District of Columbia, False Claims Act, Illinois, Nationwide Importance, New York
The DC Council has once again advanced a bill (the False Claims Amendment Act, B23-0035) that would allow tax-related false claims against large taxpayers! The bill passed a first reading of the Committee of the Whole on Tuesday, November 17, 2020, by a vote of 8-5. The bill is sponsored by Councilmember Mary Cheh, who...
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