Barrons State Tax Consulting, PLLC offers a broad range of state
and local tax services. The following services are examples of the consulting assistance
we can provide to your business. However each client's situation is unique and will
dictate the nature and scope of the services to be provided.
Over time how a company does business, where it does business and the type of business
it is involved in can change dramatically. Acquisitions, mergers, divestitures,
new locations, expansion and contraction of existing facilities can all impact the
state tax landscape for a business. The best time to effectively manage the state
tax implications of these events and transactions is before the events take place.
Barrons State Tax Consulting can provide the analytical skills and due diligence
necessary in these situations to not only determine the state tax impact of such
changes but where possible, provide a tax management approach that fits with the
business model of the enterprise.
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Taxing authorities at the state level as well as locally across America have become
increasingly aggressive not only in their interpretation of state tax law but also
in regard to the federal protections granted by Congress as they apply to interstate
commerce. Recently several states have enacted legislation or promulgated rules
effectively limiting the deductibility of certain expenses between related parties
in response to the perceived vulnerability to manipulation, of separate entity filing.
Other states have enacted laws requiring mandatory unitary combined filing to address
some of the same issues. With the advent of the digital age states have increasingly
expanded their interpretation of the definition of tangible personal property as
it applies to sales or use tax to include areas of ecommerce. Barrons State Tax
Consulting is there to provide its clients with the professional resources necessary
to defend against incorrect assessments; prepare, support and pursue refund claims;
and in the preparation of tax technical support for classifications, elections and
filing statuses as they apply to positions taken by the taxpayer.
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The lack of uniformity in definition amongst the states in tax base, filing status
and apportionment for both income and franchise taxes have made tax compliance for
a multistate or multinational enterprise complex as well as costly. The statutes
and regulations associated with these issues can even change yearly based on the
budget constraints for each of the states. With the implementation of FIN48 for
publicly held entities, it is no longer possible for many enterprises to take a
"wait and see" approach with regard to positions taken on state tax filings or whether
to file at all. Barrons State Tax Consulting can help your business evaluate its
multistate tax exposure as well as identify filing opportunities to help manage
your state tax burden, as part of a State Tax Review.
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In today's economy it is often necessary for a business to reach out to new markets
beyond the boundaries of its state of organization or commercial domicile. A business
seeing growth in new markets often experiences a growth in tax administrative responsibilities
as well. When the customer base is found in multiple states, a business must determine
whether it has a taxable presence or "nexus" in some or all of those states. This
is not an easy task since the tax structures and the laws governing those tax structures
differ from state to state as well as by tax. In fact the laws governing nexus may
differ based on the type of business a taxpayer is in. As a result a business enterprise
must constantly monitor its activities across state lines to determine the state
tax impact of entering new markets.
At Barrons State Tax Consulting we have significant experience addressing the tax
implications of interstate transactions for those businesses entering a new market
as well as helping businesses with an established presence resolve tax filing uncertainties.
Some of the specific Nexus Services we offer are:
- Voluntary Disclosure Negotiation
- State Activity Reviews ñ including assistance with FIN48 analysis
- Reviews of Allocation and Apportionment
- Analysis of State Tax Filing Options including Entity Structuring
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When a business looks at its state tax burden it often focuses on state income and
franchise taxes. Remarkably, transaction taxes and property taxes paid by business
across the United States exceed the amounts paid in income and franchise tax. In
fact, transaction taxes are often a much bigger exposure item on state audits. Part
of the reason for this is that the types of transactions subject to tax vary greatly
from state to state as well as the definitions of property that may be subject to
tax. In mergers and acquisitions that are often tax free for federal income tax
purposes there can be a hidden cost for sales tax as well as real estate transfer
taxes. There has been an effort by some states as well as the business community
to bring consistency to the transaction tax landscape through the Streamlined Sales
Tax Project (SSTP). While the Streamlined Sales Tax Project has produced some definitional
consistency for those states participating, the project was mired in political infighting
amongst the states and the end result was far from the consistent treatment that
was promised.
Barrons State Tax Consulting is able to help your business determine the transaction
tax cost of proposed projects, asset purchases and operational changes before the
deal is done as well as after the transaction is completed. Some of the areas where
we may be of service include:
- Analysis of the Tax Implications of Bundled Transactions
- Transaction Tax Analysis of Mergers, Acquisitions and Divestitures
- State Tax Due Diligence of Target Acquisitions
- Voluntary Disclosure Negotiation
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