Reed Smith’s State Tax team prides itself on its ability to offer tax services such as multistate refund reviews, in addition to traditional legal controversy services. We are recognized as a leading state tax practice in the United States with more than 30 dedicated state tax attorneys throughout the country. Our attorneys come from private practice, state government departments of revenue and attorneys general offices, in-house, and Big 4 public accounting firms. Some of our attorneys are also CPAs or have accounting degrees and related experience. This deep and varied experience allows us to be more than just litigators; we are tax advisors, focused on reducing our clients’ tax expense to increase their bottom line.

We approach each client’s state tax issues with the resources of a global firm but the focus of a boutique state tax firm. Our attorneys typically develop a particular skill set in just a few states and build local relationships, while leveraging our national platform to truly be multistate tax advisors. We have built a Tax Intelligence system that allows us to identify specific state tax positions before they become commonly known to the public. Coupled with our team’s controversy and litigation experience, these characteristics make us the best-suited tax advisors to perform refund reviews because we have the unique knowledge of when and how a state will pursue a particular tax issue, and we advise our clients accordingly.

The Reed Smith State Tax team are leaders in tax planning and audit defense for individual taxpayers.

Personal income tax audits should be based on a neutral application of the law to the facts presented – not to raise revenue or “protect the fisc.” Taxpayers should pay no more in taxes than they legally owe. Our team’s charge is simple: to help individuals plan for large income-generating events and changes in residency, defend against audits, and prevent the payment of taxes not owed.

Reed Smith's State Tax Group’s California team consists of lawyers engaged in cutting-edge multistate cases involving apportionment (including alternative apportionment) and sourcing; the tax effect of significant dispositions, including the application of California’s “Occasional Sale” rule; examinations of unity and instant unity in the acquisition context; the treatment of dividends; the business and nonbusiness character of income; and the application of special industry rules, such as those applicable to banks and financial corporations and extractive companies. The California team is also known for taking novel approaches to issues such as the calculation and preservation of various deductions and credits and also for challenging the imposition of penalties such as accuracy-related penalties and the large corporate understatement penalty. Our team has also secured large sales tax refunds for clients, involving issues such as technology tax agreements.

Reed Smith’s State Tax Group has extensive experience handling state tax matters in our nation’s capital region, which comprises the District of Columbia, Maryland, and Virginia.

The Reed Smith State Tax Group’s Delaware tax practice has extensive experience in corporate income tax and gross receipts tax matters. Our group represents clients before the Tax Appeal Board, the Delaware Superior Court, and the Delaware Supreme Court.

Delaware is often thought of as a safe haven from state taxes. While that’s often true, it's not always the case.

Reed Smith’s State Tax Group has a long history of successfully representing and advising clients with respect to their State of Illinois and local taxes. We have experience with all Illinois taxes, including all City of Chicago and Cook County taxes. Our broad state and local tax experience allows us to craft the right solution for our clients, whether through legislative, regulatory, or other administrative representation; in litigation for local and state administrative bodies; and in the state and federal courts. Our lawyers draft proposed legislation, comment on proposed regulations, and sometimes just know the right person to contact to address our clients’ concerns.

We defend audits and settle controversies with state and local departments of revenue and with the Illinois Attorney General’s Office. Our litigation inventory includes consumer class action defense, protest and refund litigation before the Illinois Independent Tax Tribunal, Informal Conference Board, Board of Appeals, administrative hearings, and in state and federal courts at all levels.

The Reed Smith State Tax Group’s Massachusetts tax practice has extensive experience in corporate excise tax and sales tax matters and represents clients in tax planning, audits, refund claims, mediation, and appeals before the Office of Appeals and Appellate Tax Board. Our clients include leading firms in the financial, telecommunications, computer services, and pharmaceutical industries. We regularly assist clients in resolving complex issues involving apportionment, nonapportionable income, debt classification, and combined reporting.

Our commitment to obtaining the best results for clients includes exploring alternative, proactive means of resolving issues, with the Massachusetts Department of Revenue (the Department), including voluntary disclosure and the Department's early mediation program, as well as providing clients with insights on cutting-edge issues derived from our growing database of unpublished documents.

Reed Smith’s State Tax Group has one of the leading New Jersey state tax practices, with more than a dozen lawyers licensed to practice in the state.

We advise clients on corporation business tax, sales and use tax, and various New Jersey gross receipts taxes and fees. Unlike non-lawyer consulting firms, we are able to represent our clients at all appeal levels–from audit through litigation. Not only do we defend clients in connection with audits and assessments, we also conduct income tax and sales and use tax reviews to identify potential refund opportunities. We also advise clients on planning initiatives and the New Jersey tax implications of corporate reorganizations. Our team includes registered New Jersey lobbyists, which enables us to advocate for clients across all branches of government.

Our team has been at the forefront of New Jersey’s switch to combined reporting and market sourcing, which became effective in 2019. When combined reporting was first proposed, a member of our team met with each bill sponsor and testified before the Senate Budget Committee. We have continued to closely monitor the Division of Taxation’s informal policies and have conducted numerous training programs regarding potential taxpayer exposures and opportunities.

The Reed Smith State Tax team has a strong hub of knowledge and skill in handling New York state tax matters.

Below are some highlights of the team's experience, as well as some opportunities and "words to the wise" that could benefit your company.

Reed Smith’s State Tax Group has significant experience handling Ohio state tax matters. We are licensed to practice in Ohio, and our experience includes assessment and refund matters through the administrative level, at the Board of Tax Appeals (where an Ohio-licensed attorney is required), and at the Supreme Court of Ohio. In particular, our team has handled appeals and advised clients on various Ohio tax types including the Commercial Activity Tax, Sales and Use Tax, and the Financial Institutions Tax.

Reed Smith’s State Tax Group has been representing clients in Pennsylvania for more than 30 years. We have extensive experience with all types of Pennsylvania taxes. We advise clients on filing methods and positions; we settle controversies with the Department of Revenue and the Office of Attorney General; we obtain favorable letter rulings; we win cases at the Board of Appeals and the Board of Finance and Revenue; and we win cases in court.

But despite our long history of success in Pennsylvania tax matters, we don’t get complacent or rest on our laurels. Our State Tax team continually adapts to changes in Pennsylvania tax policy and continually strives to know all the latest issues and arguments advancing their way through audits and appeals. We merge this unparalleled knowledge with the latest technological innovations, such as automation, machine learning, artificial intelligence, and data analytics, to provide an exceptional client experience and to maximize results. In short, we use the right tools at the right times to help clients pay the least amount of Pennsylvania tax.

A brief summary of some Pennsylvania corporate net income tax and sales and use tax opportunities:

Sales tax

In the last decade, the Texas Comptroller has continued to weaponize taxable data processing services, aggressively subjecting a variety of electronic services and apps to Texas sales and use tax. We believe the statute is overbroad and vague. Additionally, we believe the Texas Comptroller’s policy positions violate the taxing statute. We continue to challenge audit assessments and identify refund opportunities for our clients that stem from the Texas Comptroller’s ever-expanding definition of “data processing.”

In addition to data processing, the Texas Comptroller’s rules governing construction purchases can be difficult to navigate. During an audit, such purchases can quickly be put under a microscope, potentially resulting in a sizeable assessment. Proper Texas sales tax consequences depend on a host of project-specific factors. As a result, we assist our clients in crafting contractual provisions that fit their specific needs. We also continue to represent our clients during audits and to vigorously challenge assessments that frequently stem from contract pricing disputes and misapplied exemptions. We also assist clients in securing refunds for overpaid taxes on capital improvement projects.

Texas state tax intelligence

Our team remains current on all things related to Texas tax issues. This includes monitoring issue trends and delivering accurate and timely information to our clients. We are deeply involved in a number of tax organizations, and we serve on a variety of committees in order to keep our finger on the pulse and to be proactive – not only reactive – for our clients. We also track all pending Texas tax administrative matters, lawsuits, and appeals across a variety of tribunals, and our team frequently writes and speaks on Texas tax topics.

Our State Tax Abandoned and Unclaimed Property team is made up of experienced attorneys with the insight necessary to guide you through the rapidly evolving arena of unclaimed property. From bringing your organization into compliance, to audit defense and planning opportunities, we will be your advocate to help define, manage and minimize your company’s exposure as a holder of unclaimed property.