State tax laws go to Supreme Court

[YoUDeeMan]

We all can agree on one thing...there are too many taxes.

Uh, nevermind...the Donks, who want more free things, want more taxes on anyone who earns more than them, and the Conks want more taxes so that our great nation's borders can be closed to the unwashed masses.

But, besides that, none of us like when Uncle Sam comes to take his pound of flesh from us as individuals.

Note: the West Coast folks can pretty much ignore this issue since they can travel for several light years before they get to the neighboring state's border, but the East Coast folks, who can travel to 3-4 states in 45 minutes on a tricycle, should get ready for the massive battle that will take place if the lower court ruling stands.

Pay attention folks:

http://www.cnbc.com/id/101707036" onclick="window.open(this.href);return false;

"The Supreme Court is taking up a dispute over how a state may tax income its residents earn in another state.

The high court on Monday agreed to hear an appeal from Maryland officials who want to overturn a lower court ruling that found the state's tax law unconstitutional.

Maryland law allows residents to deduct income taxes paid to other states from their Maryland state tax. But it does not apply that deduction when it comes to local "piggyback taxes" the state collects for county and city governments.

Last year, the Maryland Court of Appeals said the tax violates the Constitution's Commerce Clause and discourages Maryland residents from earning money outside the state.

Maryland Attorney General Douglas Gansler says the state has authority to tax all income of its residents."

My wife works in PA. DE state taxes are higher than PA's (we have no sales tax), so we always owe more taxes on her income.

It will be interesting to see if the Supreme Court tears down the ability for states to tax income earned in other states. Of course, the states will respond with higher property taxes (or some other form of tax), but it will be an interesting ride for a lot of people. Heck, it might even push us closer to a flat tax...if that didn't mean a zoo full of tax prep folks and accountants for each person would lose their jobs and go on welfare.

[CID1990]

Dud e when I saw the thread title I thought to myself, "I bet Maryland is involved"

[Ibanez]

SC politicians are looking at eliminating the income tax. But that's an election year ploy. Much like the candidate that ran on eliminating property taxes.

[bluehenbillk]

Cluck are you talking about a local earned income tax?

[YoUDeeMan]

Cluck are you talking about a local earned income tax?

It's a short article, but MD is taxing income earned in another state (other states do that, too). The lower court apparently said some part, or maybe all, of that tax was illegal.

"The high court on Monday agreed to hear an appeal from Maryland officials who want to overturn a lower court ruling that found the state's tax law unconstitutional.
Maryland law allows residents to deduct income taxes paid to other states from their Maryland state tax. But it does not apply that deduction when it comes to local "piggyback taxes" the state collects for county and city governments.

Last year, the Maryland Court of Appeals said the tax violates the Constitution's Commerce Clause and discourages Maryland residents from earning money outside the state."

I know DE doesn't give credit for local taxes paid in PA. They give credit for the state tax, but PA's state tax is lower than DE's, so we have to pay extra on her PA earned income.

If the SCOTUS rules that MD's state income tax on income earned in another state is illegal, it will set off fireworks in state legislatures.

[andy7171]

Maryland: If you can do it, we can tax it.

[bluehenbillk]

Sounds like a waste of time if you ask me.

It may be different people paying different amounts but we all know what will happen if Maryland loses. They'll have a revenue shortfall & will raise taxes elsewhere to make up for it.....

[89Hen]

Maryland Attorney General Douglas Gansler says the state has authority to tax all income of its residents.

Our next Governor.

[tribe_pride]

Those of us who work in DC and live in VA or MD would like the SC to rule that it is unconstitutional. DC is forbidden by Federal law to impose income taxes on employees who work in DC but live out of the District.