Catalano, Caboor & Co.
Tax Alerts
Applicable Dollar Amount for Health Insurance Plan Fees Announced (Notice 2025-61)
The IRS has announced that the applicable dollar amount used to calculate the fees imposed by Code Secs. 4375 and 4376 for policy and plan years that end on or after October 1, 2025, and before Oc...
The IRS has announced that the applicable dollar amount used to calculate the fees imposed by Code Secs. 4375 and 4376 for policy and plan years that end on or after October 1, 2025, and before Oc...
Partnership Claimed Deduction for Wrong Year, Penalties Imposed (Corning Place Ohio LLC., CA-6)
A partnership (taxpayer) was denied a deduction for an easement donation related to a property (P1). The taxpayer claimed the deduction for the wrong year. Additionally, the taxpayer (1) substantially...
A partnership (taxpayer) was denied a deduction for an easement donation related to a property (P1). The taxpayer claimed the deduction for the wrong year. Additionally, the taxpayer (1) substantially...
IRS Grants Relief to Taxpayers Affected by Terrorist Action in Israel; Deadlines Postponed (Notice 2025-53; IR-2025-97)
The IRS has provided relief under Code Sec. 7508A for persons determined to be affected by the terroristic action in the State of Israel throughout 2024 and 2025. Affected taxpayers have until Septe...
The IRS has provided relief under Code Sec. 7508A for persons determined to be affected by the terroristic action in the State of Israel throughout 2024 and 2025. Affected taxpayers have until Septe...
Office of Appeals Begins Pilot Program on Mediation (IR-2025-100)
The IRS Independent Office of Appeals has launched a two-year pilot program to make Post Appeals Mediation (PAM) more attractive to taxpayers. Under the new PAM pilot, cases will be reassigned to an A...
The IRS Independent Office of Appeals has launched a two-year pilot program to make Post Appeals Mediation (PAM) more attractive to taxpayers. Under the new PAM pilot, cases will be reassigned to an A...
IRS Reminds Taxpayers to Safeguard Financial Records in Emergency Plans
The IRS has reminded taxpayers that emergency readiness has gone beyond food, water and shelter. It also includes safeguarding financial and tax documents. Families and businesses should review their ...
The IRS has reminded taxpayers that emergency readiness has gone beyond food, water and shelter. It also includes safeguarding financial and tax documents. Families and businesses should review their ...
AL - Statute of limitations for taxpayer refund of tax collected by seller
The Alabama Tax Tribunal ruled that the statute of limitations of three years from the date the return was filed applied even in cases where it was not the taxpayer who filed the return but the seller...
The Alabama Tax Tribunal ruled that the statute of limitations of three years from the date the return was filed applied even in cases where it was not the taxpayer who filed the return but the seller...
AK - Integrated transmission systems legislation enacted
Alaska has enacted legislation creating new energy incentives by extending tax-exempt statutes to independent power producers. An electricity generation facility or electricity storage facility that i...
Alaska has enacted legislation creating new energy incentives by extending tax-exempt statutes to independent power producers. An electricity generation facility or electricity storage facility that i...
AZ - Local tax rate table released
Arizona's Department of Revenue released the transaction privilege tax (TPT) rate chart effective January 1, 2026. There are noted changes for previously announced tax rates changes for Holbrook, Phoe...
Arizona's Department of Revenue released the transaction privilege tax (TPT) rate chart effective January 1, 2026. There are noted changes for previously announced tax rates changes for Holbrook, Phoe...
AR - Agricultural federal relief payments are exempt
Arkansas Governor, Sarah Huckabee Sanders, announced that payments received by farmers from the Emergency Commodity Assistance Program (ECAP) are exempt from state income tax for tax years beginning J...
Arkansas Governor, Sarah Huckabee Sanders, announced that payments received by farmers from the Emergency Commodity Assistance Program (ECAP) are exempt from state income tax for tax years beginning J...
CA - Extensions available for Mono County employers affected by pack fire
Employers in Mono County directly affected by the Pack Fire may request up to a two-month extension of time from the California Employment Development Department to file their state payroll reports an...
Employers in Mono County directly affected by the Pack Fire may request up to a two-month extension of time from the California Employment Development Department to file their state payroll reports an...
CO - Guidance on filing requirements related to master settlement agreement updated
Colorado updated its guidance on the filing requirements for tobacco product manufacturers and distributors in connection with the Master Settlement Agreement (MSA). Manufacturers selling cigarettes o...
Colorado updated its guidance on the filing requirements for tobacco product manufacturers and distributors in connection with the Master Settlement Agreement (MSA). Manufacturers selling cigarettes o...
CT - The generation of electricity was not manufacturing for purposes of exemption
The generation of electricity is not manufacturing within the meaning of the statutory property tax exemption for machinery and equipment used in manufacturing. The term "machinery and equipment" is...
The generation of electricity is not manufacturing within the meaning of the statutory property tax exemption for machinery and equipment used in manufacturing. The term "machinery and equipment" is...
DE - Split rate taxation based on property classification upheld
The Supreme Court of Delaware upheld the constitutionality of a law that allows New Castle County school districts to implement temporary split-rate property tax assessments based on residential and n...
The Supreme Court of Delaware upheld the constitutionality of a law that allows New Castle County school districts to implement temporary split-rate property tax assessments based on residential and n...
FL - Governor announces his 2026-2027 budget proposal, which includes a second amendment sales tax holiday
The governor’s 2026-2027 budget proposal recommends a second consecutive Second Amendment Sales Tax Holiday, from September 7, 2026, through December 31, 2026, on the retail sale of firearms, ammuni...
The governor’s 2026-2027 budget proposal recommends a second consecutive Second Amendment Sales Tax Holiday, from September 7, 2026, through December 31, 2026, on the retail sale of firearms, ammuni...
GA - Tax rate chart for energy sold to manufacturers issued for Q1 of 2026
Georgia has released an updated chart of local sales and use tax rates for energy sold to manufacturers. The rates are effective January 1, 2026. Energy Sold to Manufacturers, Georgia Department of R...
Georgia has released an updated chart of local sales and use tax rates for energy sold to manufacturers. The rates are effective January 1, 2026. Energy Sold to Manufacturers, Georgia Department of R...
HI - Amended rule incorporates withholding tables for tax years beginning after 2025
The Hawaii Department of Taxation announced the adoption of an amended rule incorporating updated income tax formulas and withholding tables for taxable years beginning after December 31, 2025. The ...
The Hawaii Department of Taxation announced the adoption of an amended rule incorporating updated income tax formulas and withholding tables for taxable years beginning after December 31, 2025. The ...
ID: Reminder issued on exemption for small sellers
daho residents are reminded about previously enacted legislation that provides a sales and use tax exemption for certain small sellers with annual sales of $5,000 or less. The exemption is effective J...
daho residents are reminded about previously enacted legislation that provides a sales and use tax exemption for certain small sellers with annual sales of $5,000 or less. The exemption is effective J...
IL - Local tax rate changes for January 2026 updated
Illinois updated guidance showing municipal, county, and business district sales tax rate changes that are effective beginning January 1, 2026. The local rates apply to general merchandise sales repor...
Illinois updated guidance showing municipal, county, and business district sales tax rate changes that are effective beginning January 1, 2026. The local rates apply to general merchandise sales repor...
IN - Revised guidance issued on the determination of withholding for state and County income tax
Revised guidance is issued regarding the determination of withholding for state and county income tax. The purpose of the notice is to assist withholding agents in computing the correct amount of Indi...
Revised guidance is issued regarding the determination of withholding for state and county income tax. The purpose of the notice is to assist withholding agents in computing the correct amount of Indi...
IA - Local option sales tax jurisdiction changes announced
Effective January 1, 2026, the Iowa local option sales tax (LOST) has sunset date and hotel and motel tax changes. Specifically, the sunset date changes are as follows:In Black Hawk County, the cities...
Effective January 1, 2026, the Iowa local option sales tax (LOST) has sunset date and hotel and motel tax changes. Specifically, the sunset date changes are as follows:In Black Hawk County, the cities...
KS - Interest rates set for 2026 tax year
The interest rates for the underpayment and overpayment of various Kansas taxes, including income, sales and use, and motor fuel taxes, is set at 8% for the period from January 1, 2026 to December 3...
The interest rates for the underpayment and overpayment of various Kansas taxes, including income, sales and use, and motor fuel taxes, is set at 8% for the period from January 1, 2026 to December 3...
KY - Pro rata distribution of sale proceeds to lien holders required
The Kentucky Supreme Court upheld a property tax decision requiring the distribution of proceeds from a foreclosure sale to lien holders on a pro-rata basis, rather than under the common law rule of ...
The Kentucky Supreme Court upheld a property tax decision requiring the distribution of proceeds from a foreclosure sale to lien holders on a pro-rata basis, rather than under the common law rule of ...
LA - Commercial farmer registration for exemption explained
The Louisiana Department of Revenue has issued guidance for commercial farmers and agricultural manufacturers that must register in order to claim exemption from state and local sales and use taxes on...
The Louisiana Department of Revenue has issued guidance for commercial farmers and agricultural manufacturers that must register in order to claim exemption from state and local sales and use taxes on...
ME - Rate schedules, withholding tables issued for 2026
Maine has updated the individual income tax rate schedules and withholding tables for 2026. The 2026 statutory tax rates are 5.8%, 6.75%, and 7.15%. The top rate is imposed on single or married taxpay...
Maine has updated the individual income tax rate schedules and withholding tables for 2026. The 2026 statutory tax rates are 5.8%, 6.75%, and 7.15%. The top rate is imposed on single or married taxpay...
MD - State will defer payment plans for federal employees unable to meet obligations
The Maryland Comptroller announced that the state will defer payment plans for federal employees who are unable to meet their tax obligations due to the federal government shutdown.Federal employees d...
The Maryland Comptroller announced that the state will defer payment plans for federal employees who are unable to meet their tax obligations due to the federal government shutdown.Federal employees d...
MA - Interest rates remain unchanged for the first quarter of 2026
The interest rates on the underpayment and overpayment of Massachusetts taxes are unchanged for the period January 1, 2026, through March 31, 2026. The rates have held steady at 6% for overpayments, a...
The interest rates on the underpayment and overpayment of Massachusetts taxes are unchanged for the period January 1, 2026, through March 31, 2026. The rates have held steady at 6% for overpayments, a...
MI - Construction guidance updated
The Michigan Department of Treasury has updated its guidance on the application of sales and use tax to the construction industry to reflect the enactment of PAs 181 and 207. These bills extend the ex...
The Michigan Department of Treasury has updated its guidance on the application of sales and use tax to the construction industry to reflect the enactment of PAs 181 and 207. These bills extend the ex...
MN - Guidance on coupons and discounts updated
Minnesota updated its guidance on sales and use taxes related to coupons, discounts, rewards, rebates, and other forms of payment. The guidance explains how these forms of payment impact tax calculati...
Minnesota updated its guidance on sales and use taxes related to coupons, discounts, rewards, rebates, and other forms of payment. The guidance explains how these forms of payment impact tax calculati...
MS - Broadband technology credit limits and allocation process established
Mississippi issued guidance on income and franchise tax credits for broadband technology deployment by telecommunications enterprises. House Bill 1644 enacted in 2025 limits total allowable credits to...
Mississippi issued guidance on income and franchise tax credits for broadband technology deployment by telecommunications enterprises. House Bill 1644 enacted in 2025 limits total allowable credits to...
MO - Local tax rate changes announced
The following local Missouri sales and use tax rate changes take effect January 1, 2026. Also, new rates are listed for each county, city, and special district affected by the rate changes.County Chan...
The following local Missouri sales and use tax rate changes take effect January 1, 2026. Also, new rates are listed for each county, city, and special district affected by the rate changes.County Chan...
MT - Updated wage withholding tables released
The Montana Department of Revenue has updated its wage withholding tax tables (Employer and Information Agent Guide) as well as the Montana Employee’s Withholding and Exemption Certificate (Form MW-...
The Montana Department of Revenue has updated its wage withholding tax tables (Employer and Information Agent Guide) as well as the Montana Employee’s Withholding and Exemption Certificate (Form MW-...
NE - Guidance updated on computer reporting procedures for form 1099
For corporate and personal income tax purposes, the Nebraska Department of Revenue has updated its informational guide on computer reporting procedures for 1099's, 21 CM. The guide provides informatio...
For corporate and personal income tax purposes, the Nebraska Department of Revenue has updated its informational guide on computer reporting procedures for 1099's, 21 CM. The guide provides informatio...
NV - Tax exemption criteria tightened for nonprofit organizations
Nevada's Department of Taxation has revised the criteria for nonprofit organizations to qualify for sales and use tax exemptions, requiring compliance with enhanced standards. In determining whether a...
Nevada's Department of Taxation has revised the criteria for nonprofit organizations to qualify for sales and use tax exemptions, requiring compliance with enhanced standards. In determining whether a...
NH - Amnesty application steps outlined
New Hampshire has outlined steps that taxpayers must take to apply for the tax amnesty authorized by the New Hampshire Legislature during the 2025 session.Amnesty runs from December 1, 2025, through F...
New Hampshire has outlined steps that taxpayers must take to apply for the tax amnesty authorized by the New Hampshire Legislature during the 2025 session.Amnesty runs from December 1, 2025, through F...
NJ - Assessed interest rate on outstanding balances for 2026 announced
New Jersey issued guidance on the assessed interest rate for outstanding tax balances for the calendar year 2026. Effective January 1, 2026, the interest rate is 10%. The rate is calculated as the pri...
New Jersey issued guidance on the assessed interest rate for outstanding tax balances for the calendar year 2026. Effective January 1, 2026, the interest rate is 10%. The rate is calculated as the pri...
NY - Publication revised to reflect extended expiration dates of additional taxes in various localities
New York has revised a publication setting out the enactment and effective dates of local New York sales and use tax rates to reflect changes in the expiration dates for additional taxes imposed in va...
New York has revised a publication setting out the enactment and effective dates of local New York sales and use tax rates to reflect changes in the expiration dates for additional taxes imposed in va...
NC: Guidance issued on weight-based snuff tax, alternative nicotine products tax, and inventory tax
Guidance is issued regarding recently enacted legislation, effective July 1, 2025, that changed the North Carolina excise tax rate methodology for snuff, imposed a new excise tax on alternative nicoti...
Guidance is issued regarding recently enacted legislation, effective July 1, 2025, that changed the North Carolina excise tax rate methodology for snuff, imposed a new excise tax on alternative nicoti...
ND - Local rate changes announced
North Dakota has announced the following local sales and use tax changes effective January 1, 2026: (1) the city of Medina will impose a 1% local lodging and restaurant tax; (2) the city of Sherwood w...
North Dakota has announced the following local sales and use tax changes effective January 1, 2026: (1) the city of Medina will impose a 1% local lodging and restaurant tax; (2) the city of Sherwood w...
OH - 2026 first quarter PAT average wholesale prices released
Ohio has released the petroleum activity tax (PAT) statewide average wholesale prices for the first quarter of 2026.The average prices per gallon for the first quarter are:$2.021 for unleaded gasoline...
Ohio has released the petroleum activity tax (PAT) statewide average wholesale prices for the first quarter of 2026.The average prices per gallon for the first quarter are:$2.021 for unleaded gasoline...
OK - Employer’s Withholding Guide Updated
The Oklahoma Tax Commission has released its withholding guide for employers withholding personal income tax from their employees’ wages in 2026. The guide contains general information regarding reg...
The Oklahoma Tax Commission has released its withholding guide for employers withholding personal income tax from their employees’ wages in 2026. The guide contains general information regarding reg...
OR - Oral nicotine products tax begins January 2026
The Oregon Department of Revenue (DOR) is encouraging businesses that distribute and sell oral nicotine products to plan ahead for a new tax that applies to all oral nicotine products sold and distrib...
The Oregon Department of Revenue (DOR) is encouraging businesses that distribute and sell oral nicotine products to plan ahead for a new tax that applies to all oral nicotine products sold and distrib...
PA - Fuel tax rates announced
The Pennsylvania Department of Revenue (DOR) has announced motor fuel rates for 2026. The aviation gasoline tax rate remains at 5.7¢ per gallon, and the jet fuel rate remains at 1.7¢ per gallon thro...
The Pennsylvania Department of Revenue (DOR) has announced motor fuel rates for 2026. The aviation gasoline tax rate remains at 5.7¢ per gallon, and the jet fuel rate remains at 1.7¢ per gallon thro...
RI - Definition of OTP includes nicotine
Rhode Island reminds taxpayers that the definition of "other tobacco products" has been amended to include nicotine products. Thus, effective October 1, 2025, products containing nicotine, whether nat...
Rhode Island reminds taxpayers that the definition of "other tobacco products" has been amended to include nicotine products. Thus, effective October 1, 2025, products containing nicotine, whether nat...
SC - Revised guidance issued on exemptions for farmers
South Carolina revised a recent revenue ruling concerning farmers in order to clarify what evidence retailers must maintain for exempt sales of agricultural items. The revised revenue ruling addresses...
South Carolina revised a recent revenue ruling concerning farmers in order to clarify what evidence retailers must maintain for exempt sales of agricultural items. The revised revenue ruling addresses...
SD - City of Clark implements new municipal gross receipts tax
South Dakota announced that the City of Clark will implement a new 1% municipal gross receipts tax effective January 1, 2026. News Release, South Dakota Department of Revenue, November 5, 2025...
South Dakota announced that the City of Clark will implement a new 1% municipal gross receipts tax effective January 1, 2026. News Release, South Dakota Department of Revenue, November 5, 2025...
TN - Treatment of federal employee retention credit explained
Tennessee issued guidance on the excise tax treatment of the federal employee retention credit (ERC). The ERC is included in the excise tax base because it reduces the federal income tax deduction for...
Tennessee issued guidance on the excise tax treatment of the federal employee retention credit (ERC). The ERC is included in the excise tax base because it reduces the federal income tax deduction for...
TX - List of jurisdictions that impose local sales tax on telecommunications services updated
Texas has revised its list of jurisdictions that impose local sales tax on telecommunications services to add the city of Cooper as well as the Delta County Emergency Services District. Publication 9...
Texas has revised its list of jurisdictions that impose local sales tax on telecommunications services to add the city of Cooper as well as the Delta County Emergency Services District. Publication 9...
UT - Governor’s budget proposal includes expanding the child tax credit
Utah Gov. Spencer J. Cox released his Fiscal Year 2027 budget proposal that includes:expanding the state child tax credit to provide an additional average benefit of $200 to families with children age...
Utah Gov. Spencer J. Cox released his Fiscal Year 2027 budget proposal that includes:expanding the state child tax credit to provide an additional average benefit of $200 to families with children age...
VT - Projected increase in tax bills announced
Vermont announced the release of the education tax rate letter, which forecasts the education tax yields for resident homeowners and the non-homestead tax rate for upcoming fiscal year 2027. The lette...
Vermont announced the release of the education tax rate letter, which forecasts the education tax yields for resident homeowners and the non-homestead tax rate for upcoming fiscal year 2027. The lette...
VA - City of Richmond enacts disposable plastic bag tax
Effective January 1, 2026, the city of Richmond adopts the Virginia disposable plastic bag tax. The tax is imposed at the rate of 5 cents on each disposable plastic bag provided to shoppers in local g...
Effective January 1, 2026, the city of Richmond adopts the Virginia disposable plastic bag tax. The tax is imposed at the rate of 5 cents on each disposable plastic bag provided to shoppers in local g...
WA - Guidance provided on use of the direct pay permit
The Washington Department of Revenue has provided guidance on its sales and use tax direct pay program. A taxpayer may apply for a direct pay permit if it meets one of the following conditions:is expe...
The Washington Department of Revenue has provided guidance on its sales and use tax direct pay program. A taxpayer may apply for a direct pay permit if it meets one of the following conditions:is expe...
WV - Variable and combined motor excise tax rates announced for 2026
West Virginia announced the variable and combined motor excise fuel tax rates for the 2026 calendar year. The excise tax consists of a flat rate and variable rate based on the average wholesale fuel p...
West Virginia announced the variable and combined motor excise fuel tax rates for the 2026 calendar year. The excise tax consists of a flat rate and variable rate based on the average wholesale fuel p...
WI - Questions remain regarding possible arm's-length relationship
The taxpayer appealed a Wisconsin Department of Revenue finding that funds transferred from the sole shareholders to a business were non-deductible returns of capital contributions. The taxpayer argue...
The taxpayer appealed a Wisconsin Department of Revenue finding that funds transferred from the sole shareholders to a business were non-deductible returns of capital contributions. The taxpayer argue...
WY - Tax guidance updated for federal facility deliveries, nicotine pouches
In its quarterly newsletter, the Wyoming Department of Revenue noted that it has changed its position regarding the taxability of tangible personal property delivered to federal facilities. It will no...
In its quarterly newsletter, the Wyoming Department of Revenue noted that it has changed its position regarding the taxability of tangible personal property delivered to federal facilities. It will no...
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