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Diann 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.
By Diann Smith, Stephen P. Kranz and Eric Carstens on Jun 26, 2020
Posted In Delaware
The Delaware Supreme Court gave Overstock.com a win in a False Claims Act (FCA) suit alleging the retailer failed to remit unclaimed gift card funds to the state. Overstock.com Inc. v. the State of Delaware and French, DE Sup. Ct., No. 327,2019 (June 25, 2020). A jury previously found Overstock liable for approximately $7.3 million....
By Diann Smith, Stephen P. Kranz and McDermott Will & Emery on Apr 20, 2020
Posted In Nationwide Importance, Nexus, Sales Tax, Transaction Taxes
The debate over state marketplace laws may resume again, after the Uniform Law Commission (ULC) announced it has set up a committee to study whether to draft a uniform state law on online sales tax collection, focusing on marketplaces. The study committee is chaired by Utah Sen. Lyle Hillyard. The lead staffer (“reporter”) will be...
New State Digital Ad Taxes? Will Maryland’s Take Effect? Which States Will Follow? Litigation Guaranteed!
By Diann Smith and Stephen P. Kranz on Mar 25, 2020
Posted In Allocation/Apportionment, Constitutional Issues, Maryland, Nationwide Importance, Tax Base, Transaction Taxes
On March 18, 2020, Maryland legislature sent a massive new tax on digital advertising services to Governor Hogan for consideration. The tax imposes a rate of up to 10% on annual gross revenue in the state derived from digital advertising services. This tax is on a sliding scale based on companies’ global revenues and would...
By Diann Smith and Stephen P. Kranz on Jan 22, 2020
Posted In Constitutional Issues, Gross Receipts Tax, Local Tax, New York, Tax Base
On January 21, A. 9112 was introduced in the New York Assembly. An identical Senate companion bill, S. 6102, has been referred to the Senate Budget & Revenues Committee after being introduced in May 2019. The bills would impose an additional 5% tax on the gross income of “every corporation which derives income from the...
Victory? Delaware Suggests an End to Contingency Compensation for Unclaimed Property Contract Auditors
By Diann Smith and Stephen P. Kranz on Jan 17, 2020
Posted In Audits, Delaware, Unclaimed Property
For years, Delaware has used contract audit firms to enforce their unclaimed property laws and paid them based, at least partially, on the amount recovered. Motivated by this financial reward and empowered as an agent of the state, the contract-auditing firms with the State’s complicity harass holders, inflate liabilities by deploying aggressive estimation techniques and...
By Diann Smith and Stephen P. Kranz on Jan 15, 2020
Posted In Constitutional Issues, Nationwide Importance, Nebraska, Sales Tax, Tax Base, Transaction Taxes
On January 14, LB 989 was introduced in the Nebraska Legislature, which would impose sales and use tax on “the retail sale of digital advertisements.” The bill defines “digital advertisement” as “an advertising message delivered over the Internet that markets or promotes a particular good, service, or political candidate or message” (see pages 5-6 of...
BREAKING NEWS: Maryland Proposes (French) Tax on Advertising – Digital Platforms and Advertisers Beware!
By Diann Smith and Stephen P. Kranz on Jan 10, 2020
Posted In Constitutional Issues, Maryland, Sales Tax, Transaction Taxes
On January 8, SB 2 was introduced to establish a new digital advertising gross revenue tax of up to 10% on “annual gross revenues of a person derived from digital advertising services in the state.” This uncharted new tax would make Maryland the first state or locality in the United States to impose a targeted...
By Diann Smith and Stephen P. Kranz on Sep 24, 2019
Posted In Constitutional Issues, Gross Receipts Tax, Local Tax, Nationwide Importance
“Generally, the only places with gross receipts taxes today are U.S. states and developing countries.” –Professor Richard Pomp, University of Connecticut As the economy shifts to a digital one, we are finding that states are turning toward unconventional revenue options. One trend we’re seeing is the surprising comeback of the gross receipts tax (GRT): Oregon’s...
By Charles Moll, III, Diann Smith, Stephen P. Kranz and Troy M. Van Dongen on Aug 26, 2019
Posted In California, False Claims Act, Interest and Penalties, Nationwide Importance, Procedure
Legislators in Sacramento are mulling over one of the most (if not the most) troubling state and local tax bills of the past decade. AB 1270, introduced earlier this year and passed by the Assembly in late May, would amend the California False Claims Act (CFCA) to remove the “tax bar,” a prohibition that exists...
By Mark Nebergall, Diann Smith and Stephen P. Kranz on May 14, 2019
Posted In Audits, Constitutional Issues, Income Tax, Local Tax, Nationwide Importance, Sales Tax
Judicial deference to state tax agencies puts taxpayers at a steep disadvantage and wastes time and resources on costly tax disputes. A united advocacy effort can help promote passage of state-level legislation that takes the tax administrator’s thumb off the scales of justice in administrative and judicial review of tax determinations. Access the full article....