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Varnum SALT Attorney Weighs in on Retroactive Repeal of Michigan's Multistate Tax Compact for IBM

May 28, 2015

Varnum attorney Wayne Roberts was among a few State and Local Tax (SALT) attorneys who provided insight into a recent court order that is likely to have far reaching implications for the State of Michigan and out-of-state businesses which pay taxes in Michigan.

The issue stems from a recent opinion and order by Michigan Court of Claims Chief Judge Michael Talbot in the matter of IBM Corp. v Department of Treasury, in  which he applied the state's 2014 retroactive repeal of the Multistate Tax Compact. The State enacted the repeal following a Michigan Supreme Court ruling which found IBM Corp. had the ability to elect to use the apportionment formula in the Multistate Tax Compact. The State enacted the repeal to avoid paying an estimated $1.1 billion in refunds to out-of-state companies.

"Based on the IBM holdings to date, the question whether retroactive legislation is good policy appears to be separate from the question of whether such legislation is legally allowable," Roberts told Tax Analysts reporter Amy Hamilton. "But the story likely is not over. There is little doubt that there will be additional litigation to more fully develop the remaining questions presented by the IBM case."

Read the full text of the TaxAnalysts.com article at http://www.taxanalysts.com/www/features.nsf/Features/760841DB418F940185257E51006CA7E2

Roberts is a member of Varnum’s Tax Team. His practice includes all aspects of federal and state tax planning and tax litigation. He represents both closely-held and Fortune 100 companies in tax disputes with the IRS, the Michigan Department of Treasury, and revenue departments in Pennsylvania, Indiana, Tennessee, New York, California and numerous other state and local taxing jurisdictions.

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