Eric D. Carstens
Subscribe to Eric D. Carstens's PostsEric D. Carstens focuses his practice on state and local tax matters, assisting clients with state tax controversy, compliance and multistate planning across all states for a variety of tax types and unclaimed property. Eric engages in all forms of taxpayer advocacy, including litigation, legislative monitoring and audit defense. He works closely with several of the Firm's taxpayer coalitions focused on specific state tax policy issues such as the taxation of digital goods and services and unclaimed property. Read Eric D. Carstens' full bio.
ITFA Is Alive and Well: New York Advisory Opinion Reaffirms Sales Tax Exemption for Internet Access Services
By Eric D. Carstens and Jonathan C. Hague on Oct 2, 2024
Posted In Constitutional Issues, Local Tax, Nationwide Importance, New York, Sales Tax
In its latest Advisory Opinion, TSB-A-24(4)S (June 26, 2024), the New York State Department of Taxation and Finance (the Department) reaffirmed the broad protections offered by the Internet Tax Freedom Act (ITFA) against state and local taxation of internet access. The Petitioner, a New York-based business, sought clarity on whether its subscription to a secure...
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Action Required: Maryland Denies All Ad Tax Refund Claims
By Stephen P. Kranz, Eric D. Carstens and Mark Nebergall on Oct 27, 2023
Posted In Maryland, Nationwide Importance, Procedure
The Maryland Comptroller appears to have denied all refund claims for the 2022 digital advertising gross revenues (DAGR) tax! The denial notices were seemingly dated on or around October 11, 2023, and were sent via certified mail two weeks ago. The denial notices require immediate action by taxpayers. Read more here.
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Texas Taxing 130% of Marketplace Sales
By Stephen P. Kranz, Mark Nebergall and Eric D. Carstens on Oct 3, 2023
Posted In Audits, Nationwide Importance, Sales Tax, Texas, Transaction Taxes
Proving that everything is bigger in Texas, the state’s Comptroller is now assessing marketplace providers on 130% of their sales. It seems a sales tax on 100% was not big enough for tax officials in the Lone Star State. The additional 30% is a tax on the portion of the product sales price kept by...
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Maryland Ad Tax Denials Coming: Are You Ready for Tax Court?
By Stephen P. Kranz, Mark Nebergall and Eric D. Carstens on Sep 18, 2023
Posted In Maryland, Nationwide Importance, Procedure
Winter is coming, and so are denials of taxpayer refund claims for return of the illegally extracted Maryland digital ad tax (DAT). Sources in Annapolis report the Maryland Comptroller is preparing denial notices imminently. Taxpayers need to be prepared for quick action once that happens. According to our intelligence, the denial letters will inform recipients...
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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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New Mexico Proposes Regulations Addressing Gross Receipts Tax Treatment of Digital Advertising Services
By Eric D. Carstens, Stephen P. Kranz, Michael J. Hilkin, Mark Nebergall and Jonathan C. Hague on Aug 11, 2022
Posted In Allocation/Apportionment, Constitutional Issues, Local Tax, Nationwide Importance, New Mexico, Sales Tax, Tax Base, Transaction Taxes
On August 9, 2022, the New Mexico Taxation and Revenue Department published proposed regulations addressing the gross receipts tax (New Mexico’s version of a sales tax) treatment of digital advertising services. The Department states the proposed regulations do not reflect a change in policy but instead ensure the rules are consistent for all advertising platforms....
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Maryland Attorney General’s Office Says Taxpayers May Inform Customers of Increased Charges Resulting from Digital Advertising Tax
By Stephen P. Kranz, Michael J. Hilkin and Eric D. Carstens on May 3, 2022
Posted In Constitutional Issues, Maryland, Nationwide Importance
In a brief filed on April 29, 2022, the Maryland Attorney General’s Office (Attorney General) agreed that the “pass-through prohibition” of the state’s digital advertising tax “does not purport to impose any restriction on what the taxpayer may say to the customer, or anyone else, about” increased billing charges because of the tax. Last year,...
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Maryland Comptroller Adopts Digital Advertising Gross Revenues Tax Regulations
By Stephen P. Kranz, Eric D. Carstens and Jonathan C. Hague on Dec 3, 2021
Posted In Allocation/Appointment, Constitutional Issues, Maryland, Nationwide Importance, Procedure
On December 3, 2021, the Maryland Comptroller published notice of its adoption of the digital advertising gross revenues tax regulations (which was originally proposed on October 8, 2021). Per the Maryland Administrative Procedure Act, the final adopted regulations will go into effect in 10 calendar days, or December 13, 2021. (See Md. Code Ann., State...
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Federal COVID-19 Relief Bill Brings State Tax Policy to a Grinding Halt
By Stephen P. Kranz, Mark Nebergall and Eric D. Carstens on Mar 16, 2021
Posted In Constitutional Issues, Franchise Tax, Incentives, Income Tax, Local Tax, Nationwide Importance, Property Tax, Sales Tax, Tax Base
On March 11, 2021, US President Joe Biden signed the American Rescue Plan Act of 2021 (ARPA), the COVID-19 relief bill that includes $350 billion in relief to states and localities. To prevent states from using federal relief funds to finance tax cuts, Congress included a clawback provision requiring that any relief funds used to...
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