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Agency erred in taxing certain money

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The Department of State Revenue erred when it concluded certain money collected from customers of a small, rural telecommunications company were subject to Indiana's utility receipts tax, the Indiana Tax Court ruled Thursday.

In Enhanced Telecommunications Corp. v. Indiana Department of State Revenue, No. 49T10-0801-TA-1, Enhanced Telecommunications challenged the imposition of the URT on subscriber line charges (SLC) and federal universal service contribution recoveries (FUSCR) for the 2003, 2004, and 2005 tax years.

As a telecommunications company, Enhanced is subject to the URT and that tax is imposed on the company's entire taxable gross receipts, per Indiana Code. The Tax Court had to decide if the SLCs and FUSCRs are excluded from Enhanced's gross receipts pursuant to I.C. Section 6-2.3-3-4(b) because they are considered fees or surcharges.

Giving those terms their plain meaning because they are not defined by the legislature in the statute, Judge Thomas Fisher concluded the SLCs and FUSCRs are fees or surcharges separate from and in addition to Enhanced's basic monthly service charges, which aren't included in a taxpayer's gross receipts for purposes of the URT.

The Tax Court also determined the distributions Enhanced received through various federal and state subsidy programs aren't subject to the URT. The Department of State Revenue argued they would be subject to the tax because they are settlements pursuant to I.C. Section 6-2.3-3-3, but only legal settlements are considered subject to the tax. The distributions Enhanced received are settlements, but consistent with the definition of "payments, satisfaction, or final adjustments of its accounts," which aren't subject to the tax, wrote the judge.

The department's argument failed that Enhanced received the distributions as a means to recover costs associated with the use and maintenance of its telephone lines, and are directly related to the delivery of utility services because the departments' argument didn't consider I.C. Section 6-2.3-3-10 in its entirety.

"Here, the distributions clearly do not meet the terms of this statute: they are not receipts received for maintenance services provided to a consumer that are directly related to the utility services of that consumer," wrote Judge Fisher. "Rather, the distributions are governmental subsidies that are used to offset the general costs of overall line use and maintenance."

Judge Fisher rejected the department's other arguments as to why the SLCs and FUSCRs should be considered taxable under the URT because the department repeatedly improperly relied on a statutory snippet to supports its position.

The case is remanded to the department for action consistent with the stipulation between Enhanced and the department to the amount of Enhanced's URT overpayment for each of the taxable years at issue if it should prevail in the appeal.

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  2. Unlike the federal judge who refused to protect me, the Virginia State Bar gave me a hearing. After the hearing, the Virginia State Bar refused to discipline me. VSB said that attacking me with the court ADA coordinator had, " all the grace and charm of a drive-by shooting." One does wonder why the VSB was able to have a hearing and come to that conclusion, but the federal judge in Indiana slammed the door of the courthouse in my face.

  3. I agree. My husband has almost the exact same situation. Age states and all.

  4. Thanks Jim. We surprised ourselves with the first album, so we did a second one. We are releasing it 6/30/17 at the HiFi. The reviews so far are amazing! www.itsjustcraig.com Skope Mag: It’s Just Craig offers a warm intimacy with the tender folk of “Dark Corners”. Rather lovely in execution, It’s Just Craig opts for a full, rich sound. Quite ornate instrumentally, the songs unfurl with such grace and style. Everything about the album feels real and fully lived. By far the highlight of the album are the soft smooth reassuring vocals whose highly articulate lyrics have a dreamy quality to them. Stories emerge out of these small snapshots of reflective moments.... A wide variety of styles are utilized, with folk anchoring it but allowing for chamber pop, soundtrack work, and found electronics filtering their way into the mix. Without a word, It’s Just Craig sets the tone of the album with the warble of “Intro”. From there things get truly started with the hush of “Go”. Building up into a great structure, “Go” has a kindness to it. Organs glisten in the distance on the fragile textures of “Alone” whose light melody adds to the song’s gorgeousness. A wonderful bloom of color defines the spaciousness of “Captain”. Infectious grooves take hold on the otherworldly origins of “Goodnight” with precise drum work giving the song a jazzy feeling. Hazy to its very core is the tragedy of “Leaving Now”. By far the highlight of the album comes with the closing impassioned “Thirty-Nine” where many layers of sound work together possessing a poetic quality.

  5. Andrew, if what you report is true, then it certainly is newsworthy. If what you report is false, then it certainly is newsworthy. Any journalists reading along??? And that same Coordinator blew me up real good as well, even destroying evidence to get the ordered wetwork done. There is a story here, if any have the moxie to go for it. Search ADA here for just some of my experiences with the court's junk yard dog. https://www.scribd.com/document/299040062/Brown-ind-Bar-memo-Pet-cert Yep, drive by shootings. The lawyers of the Old Dominion got that right. Career executions lacking any real semblance of due process. It is the ISC way ... under the bad shepard's leadership ... and a compliant, silent, boot-licking fifth estate.

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