Tough IRS Position Means More Trusts Will Get Hit With New ObamaCare 3.8% Tax
The companies involved in the ruling were making money, but the passive activity rules were relevant because of an AMT gotcha, that references the passive activity loss rules. In computing alternative minimum taxable income, research and development costs have to be capitalized and amortized over ten years if you are not materially participating in the activities.
Fifth Avenue Inspirational Shopping Not Doing Business
Although it was not mentioned in the ruling, it would probably be a really bad idea for New York to assert that activities like that would create corporate nexus. It would put a serious dent in convention business if sending your people to a trade show would create nexus. Trying to tax corporations because they send people to your state to look at what they might want to buy there would be really dumb. Dumber than New York turned out to be:
Follow Me
Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.