Eric D. Carstens
Subscribe to Eric D. Carstens's PostsEric D. Carstens focuses his practice on state and local tax matters, assisting clients with state tax controversy, compliance and multistate planning across all states for a variety of tax types and unclaimed property. Eric engages in all forms of taxpayer advocacy, including litigation, legislative monitoring and audit defense. He works closely with several of the Firm's taxpayer coalitions focused on specific state tax policy issues such as the taxation of digital goods and services and unclaimed property. Read Eric D. Carstens' full bio.
A welcome course correction: Texas proposes to end tax on marketplace commissions
By Stephen P. Kranz, Eric D. Carstens, Michael J. Hilkin, Mark Nebergall and Jonathan C. Hague on Oct 23, 2026
Posted In Audits, Nationwide Importance, Sales Tax, Tax Base, Texas, Transaction Taxes
For several years, we wrote about the prior Texas comptroller’s position that the commissions marketplace providers charge sellers are taxable “data processing services.” The practical result was a tax on both the full price paid by the customer and the share of that price retained by the marketplace as its commission – a result we...
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Texas comptroller moves to end tax on marketplace fees
By Stephen P. Kranz, Eric D. Carstens, Michael J. Hilkin, Mark Nebergall and Jonathan C. Hague on Sep 30, 2026
Posted In Audits, Nationwide Importance, Sales Tax, Tax Base, Texas, Transaction Taxes
On September 30, 2026, Texas Comptroller Don Huffines announced that he signed an executive order directing the comptroller’s office to propose an amendment to Rule 3.330 that would remove marketplace and platform fees from the definition of “data processing services” subject to sales and use tax. The move represents a significant reversal of the comptroller’s...
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Incoming from Delaware: Unclaimed Property VDA Program invitation notices have been sent out
By Stephen P. Kranz, Eric D. Carstens and Vanessa S. Torres on Apr 13, 2026
Posted In Audits, Delaware, Interest and Penalties, Unclaimed Property
The Delaware Office of the Secretary of State (SOS) confirmed that on April 10, 2026, invitation notices were sent to businesses (holders) identified as potentially out of compliance with Delaware’s unclaimed property law. The notices encourage holders to enroll in the SOS Unclaimed Property Voluntary Disclosure Agreement (VDA) Program within 90 days of receipt of...
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Congress passes resolution blocking District of Columbia decoupling legislation
By Stephen P. Kranz, Michael J. Hilkin and Eric D. Carstens on Feb 13, 2026
Posted In District of Columbia, Federal Tax, Income Tax, Nationwide Importance
US Congress has passed H.J.Res.142, a joint resolution to nullify legislation enacted by the District of Columbia City Council to decouple from certain One Big Beautiful Bill Act (OBBBA) provisions, including: Modifications of the limit on interest that businesses may expense under Internal Revenue Code (IRC) Section 163(j). The allowance of first-year expensing for new...
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Maryland sales tax multiple points of use exemptions: Is the juice worth the squeeze?
By Eric D. Carstens, Stephen P. Kranz and Mark Nebergall on Jun 27, 2025
Posted In Allocation/Apportionment, Maryland, Nationwide Importance, Sales Tax, Tax Base
In the waning days of its 2025 session, the Maryland Legislature passed the Budget Reconciliation and Financing Act, and Governor Wes Moore signed it into law.[1] This bill expands the sales tax base to include sales of various data and information technology and cloud computing services.[2] The sales tax rate on these new categories of...
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Unclaimed Property Laws and the Health Industry: Square Peg, Round Hole
By Stephen P. Kranz, Eric D. Carstens and Vanessa S. Torres on Mar 18, 2025
Posted In Audits, False Claims Act, Unclaimed Property
The healthcare industry has recently become the target of increased scrutiny from multistate unclaimed property audits, likely due to the high volume of mergers, acquisitions, and private equity deals. These audits have shed light on the many complexities and challenges within the sector. Healthcare industry holders are often pressured by state auditors and administrators to...
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ITFA Is Alive and Well: New York Advisory Opinion Reaffirms Sales Tax Exemption for Internet Access Services
By Eric D. Carstens and Jonathan C. Hague on Oct 2, 2024
Posted In Constitutional Issues, Local Tax, Nationwide Importance, New York, Sales Tax
In its latest Advisory Opinion, TSB-A-24(4)S (June 26, 2024), the New York State Department of Taxation and Finance (the Department) reaffirmed the broad protections offered by the Internet Tax Freedom Act (ITFA) against state and local taxation of internet access. The Petitioner, a New York-based business, sought clarity on whether its subscription to a secure...
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Action Required: Maryland Denies All Ad Tax Refund Claims
By Stephen P. Kranz, Eric D. Carstens and Mark Nebergall on Oct 27, 2023
Posted In Maryland, Nationwide Importance, Procedure
The Maryland Comptroller appears to have denied all refund claims for the 2022 digital advertising gross revenues (DAGR) tax! The denial notices were seemingly dated on or around October 11, 2023, and were sent via certified mail two weeks ago. The denial notices require immediate action by taxpayers. Read more here.
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Texas Taxing 130% of Marketplace Sales
By Stephen P. Kranz, Mark Nebergall and Eric D. Carstens on Oct 3, 2023
Posted In Audits, Nationwide Importance, Sales Tax, Texas, Transaction Taxes
Proving that everything is bigger in Texas, the state’s Comptroller is now assessing marketplace providers on 130% of their sales. It seems a sales tax on 100% was not big enough for tax officials in the Lone Star State. The additional 30% is a tax on the portion of the product sales price kept by...
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Maryland Ad Tax Denials Coming: Are You Ready for Tax Court?
By Stephen P. Kranz, Mark Nebergall and Eric D. Carstens on Sep 18, 2023
Posted In Maryland, Nationwide Importance, Procedure
Winter is coming, and so are denials of taxpayer refund claims for return of the illegally extracted Maryland digital ad tax (DAT). Sources in Annapolis report the Maryland Comptroller is preparing denial notices imminently. Taxpayers need to be prepared for quick action once that happens. According to our intelligence, the denial letters will inform recipients...
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