Tax Court Coming to Georgia?

The Daily Report Online had an interesting article about a possible development in GA that most tax advisors would welcome -- a dedicated Tax Court. This court would handle mostly income tax cases, but it would also take some complex sales tax cases. It goes (almost) without saying, that a dedicated court makes good sense to specialized state tax attorneys also. Here's a quote from the article:

 

"Some attorneys and the state's top tax official want the state to establish a new court for hearing complex tax disputes. The attorneys, working through the State Bar's Taxation Law Section, hope to have a pilot program approved in 2009.

"Currently, businesses and individuals who want to dispute their taxes can either bring a suit against the state Department of Revenue or county government in Superior Court or in the Georgia Office of State Administrative Hearings. Both avenues have limitations, according to tax attorney Peter G. Stathopoulos.

"Judicial rulings published in Superior Court aren't published in a recorder, making it difficult for tax attorneys to track developments in case law, Stathopoulos said.

"Right now you only can read about tax cases when they go up to the state Court of Appeals," said Stathopoulos, an accountant with the Atlanta firm Bennett Thrasher and a former tax attorney at Morris, Manning & Martin and McGuireWoods.

"This tax court would actually publish its decisions, and it would create a lot more uniformity," he said. "

Win this $100 Raffle and You Could Owe $150K in Income Taxes

The Herald-Mail newspaper had a story about a house being raffled off for charity purposes. The house was appraised for $390,000. The newspaper asked a CPA to figure out what taxes the winner would owe. In this case, a $100 purchase would net you a tax bill of $150K. But, it would still be worth it, of course. Here's why:

 

"Nonetheless, paying $100 for a ticket in the ongoing San Mar Children's Home raffle for a $390,000 house still could be a pretty good investment, according to an official with Smith Elliott Kearns & Co. LLC.

"You've basically gotten $240,000 worth of house for nothing" if you deal with the tax load by getting a home-equity loan on it for $150,000, said Kristi Glass, a certified public accountant and tax manager for the accounting firm.

"I mean, most people don't have that low a mortgage on their house. ... So as long as you can afford the payments on the home-equity loan," you're still a winner, Glass said.

Bruce Anderson, executive director of San Mar, has an alternative solution: You can sell the house.

"I'm saying even if the winner was to turn around and put it on the market for $300,000, they would have no problem at all selling it," Anderson said. "With all this publicity, there's any number of people interested." risis.

Even General Partnerships Subject to Franchise Tax in Texas

Wait a minute! I thought general partnerships were not subject to the new franchise tax? 

I guess in Texas, you're presumed taxable until proven nontaxable. Even though general partnerships made up of only natural persons as general partners are not subject to the revised Texas franchise tax, to preserve that non-taxable status, the comptroller requires the partnership to report certain information. Last June the comptroller published a form for such partnerships to file to preserve their non-taxable status, stating: "If the form is not returned, the partnership will be presumed to be subject to the revised franchise tax and will have an annual report due on May 15, 2008."

Again I ask this question: Why are Texas legislators trying to turn Texas into California?

Another State with a Surplus -- Credit the Income Tax

Here's the headline and story from the Missouri newspaper the Columbia Tribune:

State tax income higher than expected

Published Thursday, December 6, 2007

JEFFERSON CITY (AP) - Missouri's tax revenue is coming in ahead of what was budgeted.

The state Office of Administration says November's net general revenue was up more than 6 percent compared to November 2006. Missouri's annual budget takes effect in July. Through the first five months of its fiscal year, net general revenue was up about 4.5 percent compared to last year. The state budget was built on an assumption that revenue would grow by 3.8 percent this year.

The larger-than-projected increase is largely because of income taxes. Individual income tax revenue was up more than 7.5 percent during the first five months of the budget year. Sales tax collections were up barely 1 percent over last year.