Federal Preemptions on State Tax: Updates on the ITFA and P.L. 86-272 (Completed)

Date: Wednesday, November 29, 2023
Instructor: K. Craig Reilly, Debra Silverman Herman, Hodgson Russ LLP
Begin Time:  10:00am Pacific Time
11:00am Mountain Time
12:00pm Central Time
1:00pm Eastern Time
CPE Credit:  2 hours for CPAs

The U.S. Congress has enacted several key pieces of legislation that limit the taxing authority of state and local governments. Key among these provisions are: (1) the Internet Tax Freedom Act, which established a moratorium on the imposition of state and local taxes that would interfere with the free flow of interstate commerce over the internet, and (2) P.L. 86-272, which prohibits states from imposing a net income tax on income derived from interstate commerce if the only business activity within the state is the solicitation of orders of tangible personal property. During this two hour seminar, the state and local tax attorneys from Hodgson Russ LLP will summarize recent developments impacting the scope of these federal protections, including recent taxpayer protests in which taxpayers have successfully argued that the Internet Tax Freedom Act preempts various state taxes, along with the Multistate Tax Commission’s (MTC) recent model language interpreting P.L. 86-272, which has the potential to drastically limit the protections of P.L. 86-272 for many internet vendors.

Topics Covered

  • Federal preemption of state taxing authority
  • Internet Tax Freedom Act (ITFA)
  • P.L. 86-272
  • Multistate nexus principles
  • Taxes on internet access
  • Taxes on digital goods and services
  • Taxes on internet vendors

Learning Objectives

  • Identify various federal preemptions on state and local tax enforcement
  • Recognize current trends in states' efforts to limit the scope of federal preemptions on state taxes
  • Learn how to advise clients on when to pursue state tax appeals based on federal preemption principles
  • Understand recent litigation trends involving preemption of state taxing authority


Instructional Method
Group: Internet-based

NASBA Field of Study
Taxes (2 hours)

Program Prerequisites

Advance Preparation

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