Negotiating agreements, achieving results
State and local taxes (SALT) impact our business clients at every level of their operations. Butler Snow’s tax attorneys have decades of experience successfully representing and advising clients across numerous state and local jurisdictions. We have established the credibility that allows us resolve matters quickly and put other matters on a path toward successful resolution.
State and Local Tax Credits and Incentives
Our deep understanding of state and local tax laws makes us an invaluable partner for businesses locating in a new jurisdiction. We regularly help structure and negotiate incentive packages, in conjunction with our transactional lawyers, for new and expanding businesses. Our approach ensures that our clients maximize all possible tax incentives to put them in a position to grow and prosper in their industry. We have assisted clients with negotiating fee-in-lieu agreements (FILA), payments in lieu of tax (PILOT) and other incentive agreements.
We also have full knowledge and extensive experience pairing federal incentives and programs with local incentives. For example, Butler Snow works with the New Markets Tax Credit Program, which provides federal dollars to help economically distressed communities attract business investments. This program can be effectively incorporated into state/local incentive plans for eligible business investments. For example, Mississippi has its own version of the new markets tax credit program; and we work with numerous clients to coordinate the two programs in order to maximize all available incentives for our clients.
Resolving SALT Matters
The experience and knowledge our team has garnered over the years helps us effectively negotiate agreements for existing businesses with outstanding tax issues.
We assist non-filers in negotiating acceptable terms for voluntary disclosure with state tax authorities. We also handle SALT disputes involving corporate income and franchise taxes, sales and use taxes, personal property taxes, real property taxes, telecommunications taxes and gaming taxes. We routinely represent taxpayers in filing refund claims and in the preparation and submission of requests for rulings from state departments of revenue on various SALT issues.
For our clients who are involved in audits, we can either handle all audit matters on their behalf or work with in-house professionals to develop audit strategies. We also develop strategies for our clients to minimize franchise, income, and sales and use taxes in states where they do business. We represent the interests of multi-state taxpayers involved in disputes with state and local taxing authorities by defending against improper assessments and asserting refund claims.
Our tax team strives to resolve SALT disputes through negotiated settlements at the administrative appeals level to minimize the cost to our client and the time necessary to resolve the conflict. However, we have significant experience litigating SALT disputes, as well.
Our tax attorneys actively monitor tax-law changes; and we make every effort to quickly disseminate up-to-date, relevant information to our clients. For example, promptly after federal tax law changes are announced, we routinely provide selected clients with a comprehensive analysis of how the federal changes will impact them, from both a tax and revenue perspective, at the state level.
- Represented individuals and corporate taxpayers in planning for or after assessment of state/local taxes including property, franchise, excise, sales and use, income tax and business taxes.
- Represented several warehousing and distribution centers for foodservice, department store, electronics and other enterprises for property tax abatements, income tax credits and sales/use tax exemptions, and Mississippi contractor’s tax avoidance on construction projects.
- Represented a jet engine testing facility, liquefied natural gas terminal/processing facility, automotive components manufacturer, pulp mill, electric generation facilities, plastic container manufacturer, ethanol manufacturer, petroleum refiner, engineered wood products manufacturer and numerous other types of new and expanding manufacturing/processing enterprises for property tax abatements, income tax credits, and sales/use tax exemptions, and Mississippi contractor’s tax avoidance on construction projects.
- Represented a national credit reporting company in state chancery court involving the issue of how to apportion income earned from electronic commerce.
- Represented non-resident individual taxpayers in a multimillion-dollar state income tax assessment. Taxpayers could not post jurisdictional bond. Relief was secured in a TRO action in state chancery court resulting in a favorable settlement for the taxpayers of approximately 25% of original assessment.
- Represented a multi-state corporation that had out-of-state operations operating at a loss that the Department of Revenue contended were not part of the taxpayer’s unitary business.
- Settled litigation on behalf of a Fortune 100 company in a multimillion-dollar income tax assessment and refund action in state chancery court resulting in a $4 million refund. Issue was whether gain on the sale of the business was business income or nonbusiness income under UDITPA.
- Handled appeal of a multi-state corporation in state chancery court contesting the disallowance of deductions for premiums paid to a captive insurance company.
- Represented various corporate taxpayers in defending against the reclassification of loans to affiliates as taxable capital for franchise tax purposes.
- Appeared on behalf of various corporate taxpayers to defend against the disallowance of royalty expense or interest expense paid to a non-resident intangible holding company.
- Defended corporate taxpayers against the disallowance of administrative fees paid to an affiliate.
- Represented numerous taxpayers in various industries on a multiplicity of business versus nonbusiness income and income apportionment issues.