Winter 2019

Message From the Chair

Happy New YearAs we usher in 2019, many of us resolve to make improvements in an area of our lives that feels lacking, or we add a new activity with the goal of fostering personal growth. As the SBM Taxation Section’s governing board, the Tax Council also resolves to bring members new programs and organizational improvements in the New Year, including:

  • The Taxation Section’s first ever Law Student Writing Challenge.
  • A new Tax Highlights summary, compiling selected legislative and regulatory tax developments of general interest that Council will endeavor to keep updated based on input and interest from members.
  • A re-vamped 2019 Annual Tax Conference format, offering dedicated break-out tracks in federal income tax, state and local tax, estates and trusts, and employee benefits.

And in the spirit of continuously improving communication with members and providing education on the latest tax developments impacting Michigan taxpayers, see below for updates on:

  • The Michigan Supreme Court granting the City of Detroit’s application in Honigman v. Detroit regarding service providers’ calculation of city income tax.
  • Tax Court rulings in marijuana cases.
  • The federal interest deduction disallowance for unrented renovated property.
  • An update from the Michigan Tax Tribunal.
  • The most recent final opinions and orders issued by the Michigan Court of Claims in tax cases.

Pleasjcook.jpge feel free to contact me if you have content ideas or feedback about how we can make Tax in the Great Lakes State better in 2019. And please scroll to the bottom of Tax in the Great Lakes State for an announcement about the “newest future” members of the Taxation Section!

Jackie J. Cook, Taxation Section Chair
The Mike Cox Law Firm, PLLC
jcook@mikecoxlaw.com

Introducing the Tax Section’s Law School Writing Challenge

Law School WritingThe Taxation Section is pleased to announce a new program that commenced in January—the Law Student Writing Challenge. This Writing Challenge gives law student participants the opportunity to write a short paper on a pre-selected question in one of the following areas: federal income taxation, state and local taxation, estates and trusts, and employee benefits. Submissions are due April 15, 2019, and the top entries will be announced at the Taxation Section’s Annual Tax Conference at the Inn at St. John’s on May 23, 2019. This program focused on increasing the participation in Section activities of law students at Michigan law schools who have an interest in tax law. Scholarships will be awarded to an overall winner and to the top entries in each category. More details, including the eligibility requirements, are set forth on the Taxation Section’s web page for the Writing Challenge. For more information, contact the Writing Challenge chair, James Combs at jcombs@honigman.com.

Registration Open: Annual Tax Conference on May 23 at the Inn at St. John’s

Register

Registration is now open for the Taxation Section's 32nd Annual Tax Conference. Based on feedback from you—our members—we are excited this year to offer specialty break-out tracks in the afternoon, hosted by the following Tax Council Committees: State and Local Tax, Federal Income Tax, Estates and Trusts, and Employee Benefits. The plenary sessions in the morning also offer something for everyone with presentations by Wayfair's SCOTUS lawyer, Washington insiders, a representative from the Michigan Department of Treasury's new administration, and a session on purchase price allocation.

See more information on sessions and speakers and to reserve your seat today.

There are a few sponsorship opportunities still available for a limited time. Please contact Conference Chair Michael Monaghan if you are interested in becoming a sponsor today at mike.monaghan@plantemoran.com.

New Tax Highlights Legislative Update

LegislationThe Tax Section is now offering to members a Tax Highlights summary of selected legislative and regulatory tax developments of general interest. This is not a comprehensive reporter of all tax developments. Your input is welcome. You can submit proposals for topics to include by sending a message to Sean Cook at scook@wnj.com. See the latest edition of Tax Highlights.

City Income Tax Act Developments and Honigman v. City of Detroit

W. Roberts

By Wayne D. Roberts, Partner, Varnum LLP

By order dated November 21, 2018, the Michigan Supreme Court granted the City of Detroit's application for leave to appeal in its city income tax litigation against the Honigman Law Firm (the "Plaintiff"). The issue in dispute is the methodology used to source legal services for purposes of computing the proper city income tax liability under the Michigan Uniform City Income Tax Ordinance. 

Read More or Comment

Tax Court Issues Rulings in Marijuana Cases

E. HosnerBy Erick W. Hosner, Attorney and Counselor, Howard and Howard, PLLC

The Tax Court recently decided two cases that have important implications for businesses that sell marijuana. The cases are Patients Mutual Assistance Collective Corp. d.b.a. Harborside Healthcare Center v. Comm. 151 T.C. No. 11 (Harborside) and Alternative Health Care Advocates v. Comm. 151 T.C. No. 13 (Alternative).

Read More or Comment

Interest Deduction Disallowed for Unrented Renovated Property

D. Elkus

By Daniel Elkus, Bloomfield Hills, Georgetown University Law Center JD Candidate, graduating in May 2019.

In a recent decision, Keefe v. Commissioner, 115 T.C.M. (CCH) 1113, T.C.M. (RIA) 2018-028, the Tax Court ruled that Petitioners who purchased a residential property with the intention of renovating it and renting it out, but who ultimately did not rent out the property, were not permitted to deduct interest because the property was not a capital asset.

Read More or Comment

Update from the Michigan Tax Tribunal

S. Welton

By Samantha Snow Welton, Chief Clerk of the Michigan Tax Tribunal

The Tribunal would like to thank those who attended the Administrative Law Luncheon with the Michigan Tax Tribunal this past December. Based on positive feedback, the Tribunal will be implementing a revised Prehearing General Call order in February. Currently, the Prehearing General Call requires the filing of Valuation Disclosures and Prehearing Statements 60 days prior to the start date of the call.

Read More or Comment

Recent Court of Claims Tax Decisions Available

New Court of Claims opinions and orders issued in tax cases have been added to the Taxation Section’s website. Please visit the Taxation Section’s Court of Claims Orders and Opinions page.

Tax Council sincerely appreciates Negah McKevitt of General Motors for her continuing efforts to compile a comprehensive summary about Court of Claims tax cases.

Did You Miss the Annual Fundamentals of Tax Program?

On October 25, 2018, the Tax Section hosted its second annual Fundamentals of Taxation Boot Camp at Honigman's Detroit office. The Boot Camp is designed for tax practitioners who are new to taxation or need a basic refresher. The Boot Camp provides a comprehensive overview of basic tax concepts, merger and acquisition tax considerations, state and local tax insights and discussion of other practical tax issues (e.g., entity selection in light of tax reform). Several experienced taxation attorneys presented during the Boot Camp and shared their knowledge through real-life, practice proven approaches. Approximately 65 Tax Section members and law students attended the Boot Camp. Tax Council appreciates Ryan Peruski’s efforts in putting together a fantastic event this year. We are already looking forward to our third annual Boot Camp, which is expected in the Fall of 2019. Stay tuned for more information.

Announcing the NEWEST Future Members of the Tax Section!

There was much excitement on Tax Council the week after Thanksgiving as THREE Council members each welcomed their FIRST babies into the world (two on the same day two hospital rooms away from one another)! Please join us in congratulating Ryan Peruski (Honigman), Tax Council’s Strategic Planning director; Rebecca Pugliesi (Plante Moran), our Young Lawyers Committee Chair; and Tom Fabbri (Clark Hill), who oversees our Public Communications.

Read More or Comment

Join Us: Meetings & Conferences Coming Up

Please join us at an upcoming Taxation Section event. To stay current on Section events, please visit our Events page.


Feb. 7, 8-9 a.m., Troy, MI

Employee Benefits Event: Identifying the Top ACA Reporting Errors that Lead to Penalties

Please join the Taxation Section for a presentation and roundtable discussion on Identifying the Top ACA Reporting Errors that Lead to Penalties. Joanna Kim-Brunetti, Esq., and Gregg Kasubuchi of First Capitol Consulting Inc., based in Los Angeles, will shed light on the numerous employer compliance issues they have encountered as a part of their national consulting practice, including issues with vendor preparation of 1094-C and 1095-C, Letters 226J, and the latest with ACA reporting and compliance. About First Capitol Consulting, Inc. First Capitol is a RegTech company that unlocks the value of workforce data. First Capitol provides services to optimize risk management and regulatory compliance, workforce management, data quality management and financial performance optimization, all powered by the use of a proprietary data consolidation process and regulatory risk models. First Capitol's regulatory services include ACA compliance, pay equity auditing and analytics and employment tax credits. A continental breakfast will be provided. Register online.


February 21, 5-6 p.m., Oakland County: Federal Income Tax Event

Save the date! Event details to come. Check back to the Section Events Page for more information.


March 14, 5:30-7:30 p.m., Detroit: Estates & Trusts Event

Save the date! Event details to come. Check back to the Section Events Page for more information.


April 18, 6-8 p.m., Grand Rapids: Employee Benefits Committee Happy Hour

Save the date! Event details to come. Check back to the Section Events Page for more information.

Get Involved with the Tax Section Today

Join the Taxation Section today.Join Us

If you’re already a Taxation Section Member, make sure to Join a Committee today. Members of our five Committees have unique opportunities to get involved, such as writing opportunities or presenting at a conference or seminar.

Have an idea for an article? Contact our Michigan Tax Lawyer Editor, Mindi Johnson, mjohnson@fosterswift.com.

Are you a newer tax attorney looking for other ways to contribute and get involved with the Tax Section? Contact Tax Section Chair, Jackie Cook, jcook@mikecoxlaw.com

Section Information

Chair: Jackie J. Cook

Taxation Section Website