Articles Posted in Tax Law

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W. Va. Code 11-15A-10a affords taxpayers a credit for sales taxes paid to other states, which offsets the West Virginia Motor Fuel Use Tax (“use tax”) a fuel importer must pay under W. Va. Code 11-15A-13a. After it was assessed a use tax on the fuel it uses in West Virginia, CSX Transportation sought a refund of the sales taxes it had paid on its motor fuel purchases to cities, counties, and localities of other sales pursuant to section 11-15A-10a. The Tax Commissioner rejected the refund request. The Office of Tax Appeals (OTA) granted CSX’s refund request and vacated the assessment, finding that CSX was entitled to a credit under section 11-15A-10a for the sales taxes it paid to other states’ subdivisions on its purchases of motor fuel therein. The circuit court affirmed. The Tax Commissioner appealed, arguing that the circuit court erred by not limiting the credit to sales taxes paid only to other states upon the purchase of a motor fuel. The Supreme Court affirmed, holding that the sales tax credit afforded by section 11-15A-10a applies both to sales taxes paid to other states and to sales taxes paid to the municipalities of other states. View "Matkovich v. CSX Transportation, Inc." on Justia Law

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This proceeding consisted of four consolidated appeals. The issue in two of the appeals was whether the alternative-energy infrastructures installed by Petitioners for their businesses met the statutory definition of “qualified alternative fuel vehicle refueling infrastructure” for the purpose of receiving an alternative-fuel infrastructure tax credit. The issue in the other two appeals was whether the alternative-energy infrastructures installed by Petitioners for their residences met the statutory definition of “qualified alternative fuel vehicle home refueling infrastructure” for the purpose of receiving an alternative fuel-infrastructure tax credit. The circuit court affirmed the final orders of the West Virginia Office of Tax Appeals that denied Petitioners’ requests for alternative-fuel infrastructure tax credits under W. Va. Code 11-6d-4(c). The Supreme Court affirmed, holding that the circuit court did not err in its judgment. View "Martin Distributing Co. v. Matkovich" on Justia Law

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University Park at Evansdale, LLC (UPE) was the lessor of certain property owned by the West Virginia University Board of Governors commonly known as “University Park.” The Monongalia County Assessor assessed UPE’s leasehold interest in University Park at just over $9 million for the tax year 2015. UPE challenged the assessment, arguing that its leasehold interest was $0 because the leasehold was neither freely assignable nor a bargain lease. The Board of Equalization and Review (BER) affirmed, determining that UPE’s protest presented an issue of taxability, rather than valuation, reviewable only by the Tax Commissioner. The circuit court affirmed, concluding that UPE advanced a challenge that the BER had no jurisdiction to review. The Supreme Court reversed, holding that the circuit court erred in concluding that UPE’s protest presented an issue of taxability. Remanded. View "University Park at Evansdale, LLC v. Musick" on Justia Law

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The State Tax Commissioner and the Berkeley County Assessor denied an ad valorem property tax exemption to University Healthcare Foundation, Inc. for its property known as the Dorothy McCormack Cancer Treatment & Rehabilitation Center. The circuit court overruled the denial, concluding that the healthcare and recreational services provided in the Center were primarily and immediately related to the joint charitable purposes of the Center and the Berkeley Medical Center. The Supreme Court reversed, holding that the circuit court erred in concluding that the Center was being used exclusively for charitable purposes. View "Matkovich v. Univ. Healthcare Found., Inc." on Justia Law

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The parties were divorced in 2012. The original order provided that, for tax exemption purposes, the father would claim Child B. and the mother would claim Child C. In 2014, mother sought modification of child support and medical support and requested an order providing that when one of the children reaches the age of majority, the remaining exemption should be rotated between the parents annually. Father requested the court to amend the order to include details of a joint parenting plan and to allocate the tax exemptions according to West Virginia Code 48-13-801.3, which requires that tax exemptions be proportioned between the parents according to income. After a remand from the circuit court, the family court clarified that the parties had agreed to “equal custodial allocation” and that the father had requested re-allocation of the tax exemptions only if no agreement was reached and observed: “It did not appear that the [mother’s] income and child support would be greater if the payor was awarded the exemption.” The Supreme Court of Appeals of West Virginia reversed, stating that the oral agreement regarding custodial allocation and other tangential issues did not eliminate the need to allocate the exemptions according to the statutory requirements, and remanded for financial analysis under the statute. View "Eric M. v. Laura M." on Justia Law

Posted in: Family Law, Tax Law

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Mark and Tammy Davis owned property that secured a credit line deed of trust held by Huntington National Bank. The Davises failed to pay their 2005 and 2006 real property taxes, resulting in a notice of delinquency being published. The Davises subsequently filed for Chapter 7 bankruptcy. A second notice of delinquency was then published announcing that the tax lien would be sold. A notice of the tax lien sale was mailed to the Davises but was returned undeliverable. The Davises received a discharge in bankruptcy, after which the tax lien was sold. No party redeemed the property, and the tax deed was issued to Rebuild America, Inc. The Davises then filed this action seeking to set aside the tax sale. The circuit court granted relief, finding that the issuance of the two statutory notices of delinquency while the Davises were under the protection of a bankruptcy stay voided the tax deed. The Supreme Court affirmed, holding that the bankruptcy stay rendered the statutory notices void ab initio, and therefore, the tax lien sale did not comply with the required statutory procedure. Accordingly, the tax deed issued in this matter must be set aside. View "Rebuild America v. Davis" on Justia Law

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EB Dorev Holdings, Inc. purchased tax liens on certain properties from Kanawha County. The West Virginia Department of Administration, Real Estate Division (WVDOA) later filed a complaint against EB Dorev and Kanawha county seeking to prevent the issuances of the tax deeds to EB Dorev. The circuit court granted summary judgment in favor of the WVDOA and voided the sale of the tax liens. The Supreme Court affirmed, holding (1) the circuit court erred in ruling that the properties were entered exempt from 2009 real estate taxes upon the WVDOA’s purchase of the properties from private entities in August and September of 2008; but (2) the circuit court’s alternative finding that the tax liens at issue were extinguished through the doctrine of merger was not in error. View "EB Dorev Holdings v. W. Va. Dep’t of Admin., Real Estate Div." on Justia Law

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The United Hospital Center, Inc. appealed from the State Tax Commissioner’s ruling regarding the 2011 assessment of ad valorem property taxes for the Hospital’s newly-constructed facility located in Bridgeport, asserting that, given the charitable purpose of its operations, it was entitled to exemption from property taxes. The circuit court granted summary judgment for Respondents, concluding that the Hospital was not entitled to a property tax exemption because the Bridgeport location was not physically housing and treating patients on July 1, 2010, the date used by law for property tax assessment purposes. The Supreme Court reversed, holding that a healthcare corporation that qualifies as a charitable organization under federal law, whose construction of a replacement hospital facility is substantially complete on the legal date of assessment, and who has significant departmental staff on site, comes within the spirit, purpose, and intent of exempting charitable organizations from ad valorem taxation under the statutory exemptions at issue. View "United Hosp. Ctr. v. Romano" on Justia Law

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These consolidated cases involved tax assessments for Petitioner's property. In the first appeal, Petitioner challenged the 2010 tax assessment to his property. The Board of Review and Equalization determined that Petitioner's appeal was not timely filed, and the circuit court affirmed. In the second appeal, Petitioner sought to adjust the 2011 assessment of his property, asserting that the Assessor erred in using a cost approach analysis to determine the value of the property to be $7.5 million. The Board ordered that the assessed value be reduced to approximately $6.5 million. The circuit court affirmed the Board's reduction in value. The Supreme Court reversed the circuit court's orders pertaining to both the 2010 and 2011 assessments, holding (1) the circuit court erred in finding that Petitioner's appeal of the 2010 tax assessment was untimely; and (2) the Board abused its discretion in utilizing a hybrid income approach to adjust the 2011 assessment, and because Petitioner failed to establish that the Assessor's cost approach assessment was erroneous, the 2011 tax assessment for the property should be adjusted to reflect the Assessor's initial cost approach assessment value. View "Lee Trace LLC v. Raynes" on Justia Law

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Respondents, owners of coal-bearing properties in Taylor County, challenged tax assessments on their properties during the 2010 tax year. The County Assessor challenged the State Tax Commissioner's appraisals of Respondents' property in hearings before the Board of Equalization and Review after she had previously accepted those appraisals. The Board of Equalization and Review accepted the Assessor's proposed changes and changed the valuations of Respondents' properties, thus increasing the natural resources property tax owed by Respondents. The circuit court reversed the Board's valuation changes, finding that the Assessor violated W. Va. Code 11-1C-10(g) by challenging the Commissioner's appraisals. The Supreme Court affirmed, holding (1) pursuant to section 11-1C-10(g), upon receiving the appraisal of natural resources property from the Commission, a county assessor may either accept or reject that proposal; (2) if the assessor rejects the appraisal, the assessor must show just cause for doing so; and (3) if the assessor accepts the appraisal, the assessor is foreclosed from later challenging the appraisal. View "Collett v. Eastern Royalty, LLC" on Justia Law