Client Alert

New Jersey Tax Court Rules That Intercompany Payments Are Not Taxes for Purposes of the State Tax Addback

01 Feb 2019

The Tax Court of New Jersey released its state tax addback decision in Daimler Investments US Corporation v. Director, Division of Taxation on January 31, 2019. The Tax Court agreed with our assertion that amounts Daimler Investments US paid to an affiliate pursuant to a tax sharing agreement are not taxes. The Court also ruled that such amounts are not an indirect payment of tax, disagreeing with the Division of Taxation’s position.

Morrison & Foerster represented Daimler in this case. Please contact Craig B. Fields, Mitchell A. Newmark, or Nicole L. Johnson with any questions regarding this decision.

Read a copy of the decision.

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