Taft state and local tax attorney Don Mottley recently obtained a major Ohio income tax victory in an Ohio Supreme Court decision: Ohio cannot tax out-of-state business owners on capital gains earned on the sale of businesses partially located in Ohio.
In a decision with favorable ramifications to non-Ohio residents with business interests in Ohio, Mottley won a major victory regarding the limits on Ohio’s ability to tax nonresidents. In Corrigan v. Testa, Slip Opinion No. 2016-Ohio-2805, Mottley successfully argued that a provision of Ohio’s income tax law was unconstitutional as applied to that taxpayer in attempting to tax the capital gains that the Ohio nonresident earned when he sold his interest in a business partially located in Ohio.
The 7-0 ruling found that the provision imposing the tax on an Ohio nonresident was unconstitutional under the due process clause of the 14th Amendment as applied to the nonresident taxpayer in the case. Nonresident taxpayers who have paid Ohio income tax on such gains may now have refund claims, and nonresident taxpayers who have pending audits or appeals regarding this type of tax liability may also be able to use this decision in their favor.
For more information regarding the potential impact of this decision, contact Don Mottley or any Taft tax attorney.
Taft’s State and Local Tax Practice
Attorneys in Taft’s State and Local Tax practice provide a wide range of services with respect to state and local income tax, commercial activities (gross receipts) tax, franchise tax, sales and use tax, personal property tax and real property tax, among others. We provide advice concerning compliance, nexus issues, structuring transactions, representation in connection with audits and assessments, including litigation, abatement and exemption applications, tax incentive programs and a myriad of other tax matters.
- Business Income Taxes and Gross Receipts
- Personal Income Tax
- Real Property and Personal Property Tax
- Sales and Use Taxes
- Tax and Economic Incentives
- Tax Dispute Resolution
Mottley focuses his practice on state and local tax matters, tax issues involving non-profit organizations, tax controversies (federal, state and local) and public agency law. As a public agency lawyer, Mottley both represents public agency clients and represents other clients before public agencies. He has been able to draw upon 25 years of experience as a public official and as an attorney and financial manager to the benefit of his clients. Mottley also serves as a director of Focused Capitol Solutions LLC, a Taft business affiliate that provides governmental relations and public policy services from its offices in Cincinnati and Columbus, Ohio. In this role, Mottley represents clients before Ohio state government agencies and the Ohio General Assembly.