Diann Smith
Subscribe to Diann Smith's PostsDiann 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.
False Claims Act Risk for Unclaimed Property Holders
By Diann Smith, Stephen P. Kranz and Eric Carstens on Mar 15, 2021
Posted In False Claims Act, Nationwide Importance
In what has become an unfortunate trend, unclaimed property holders continue to be subject to lawsuits under state false claims acts (FCA – also called a qui tam or whistleblower action) for alleged underreporting and remittance of unclaimed property obligations. More than 30 states have a false claims act with whistleblower provisions and nearly all...
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DC Council Expands False Claims Act to Tax Claims
By Stephen P. Kranz, Diann Smith and Eric Carstens on Dec 1, 2020
Posted In District of Columbia, False Claims Act, Nationwide Importance
The DC Council has passed an amended bill (the False Claims Amendment Act of 2020, B23-0035) that beginning as early as January 2021 will allow tax-related false claims to be raised against large taxpayers for up to 10 years of prior tax periods! This troubling legislation creates a real and imminent possibility of prior tax...
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False Claims Act Tax Expansion Bill Advanced by DC Council
By Stephen P. Kranz, Diann Smith and Eric Carstens on Nov 17, 2020
Posted In District of Columbia, False Claims Act, Illinois, Nationwide Importance, New York
The DC Council has once again advanced a bill (the False Claims Amendment Act, B23-0035) that would allow tax-related false claims against large taxpayers! The bill passed a first reading of the Committee of the Whole on Tuesday, November 17, 2020, by a vote of 8-5. The bill is sponsored by Councilmember Mary Cheh, who...
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New York Legislation Proposes to Retroactively Remove FCA Culpability Standard for Tax Law Claims
By Stephen P. Kranz, Diann Smith and Eric Carstens on Oct 14, 2020
Posted In False Claims Act, Nationwide Importance, New York
With Halloween just a few weeks away, a scary proposal is brewing in the New York State Legislature that should give taxpayers chills. Companion bills Assembly Bill 11066 and Senate Bill 8872 were recently introduced by committee chairs (Assembly Ways and Means Chairwoman Helene Weinstein and Senate Committee on Judiciary Chairman Brad Hoylman). This legislation...
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Business Victorious in Unclaimed Gift Card False Claims Case
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....
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Déjà Vu – Marketplace Model Debate May Resume Again
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...
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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...
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BREAKING NEWS: New York Considers 5% Gross Receipts Tax on Almost Every Corporation
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...
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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...
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New Trend Developing? Another Digital Advertising Tax Proposal
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...
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