Justices Get Chance to Shore Up Internal Consistency Test

Law360

08/02/2019

Mitchell A. Newmark

State + Local Tax

Reprinted with permission.

Morrison & Foerster partner Mitchell Newmark discusses Edelman v. NY Department of Taxation and Finance in the Law360 article “Justices Get Chance to Shore Up Internal Consistency Test.” The case, which has been brought to the Supreme Court, challenges New York’s denial of offsetting credits for taxes paid to another state on intangible income. The plaintiffs are asking the Court to apply the internal consistency test, which prevents the same income from being taxed more than once, as it did in its 2015 holding in Comptroller of the Treasury v. Wynne.

Mitchell told Law360 that New York state does not get to decide when a domiciliary of Connecticut gains or loses protection from double taxation.

“Does a Connecticut domiciliary have any more or less constitutional protection depending on whether New York has a statutory residency standard of more than 300 days, 183 days or 50 days?” he said. “How can the Constitution's protections be dependent on whether New York in its infinite wisdom wants to say you are here in New York, too? The Edelmans are, as are we all, deserving of an answer as were the Wynnes.”

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