Meredith Smith: Sam, thank you so much for joining us today on the SALTovation Podcast. We really appreciate your time and we're so happy to have you here to converse with. So, as we usually like to start, could you tell us how you first got into state and local tax and what made you decide to stick with it?

Samantha Breslow: Sure. I think, like probably most people, I didn't envision that I was going to go into state and local tax. I think you'd have to be kind of a weird duck to maybe envision this as a kid. But no, I was an English major and a Spanish major in undergrad at the University of Texas. I always knew I wanted to go to law school. So, I went to the University of Illinois with the goal of working in Chicago. But I honestly went into law school thinking I was going to do family law. I always had a real passion for family law and litigating divorces. I handled a bit of that in an internship during undergrad and saw that I didn't know if I wanted it—it was so personal. It's these people's livelihoods and a lot of emotions. So, when I was in law school, I had the opportunity to clerk at HMB, which is my firm now, acquired by Kilpatrick this past March. So, if I say HMB, I mean my current firm. I had the opportunity to clerk there and work with our SALT group, including some of the best minds in SALT, like Fred Marcus, Jordan, Marilyn, and Dave.

Samantha Breslow: I never really thought I wanted to do tax. That wasn't what I envisioned originally, but it's a fun area of tax. You get to play with case law, the Constitution, the Commerce Clause, Due Process Clause—all these things that were esoteric concepts in law school. I've always been a numbers person. I always liked math. Excel does not scare me; I like doing equations. So, I started at my current firm as a clerk. When I graduated, I went to Deloitte Tax and did income tax compliance for a couple of years, and a little bit of sales tax, but mostly income tax compliance. That's a fancy way of saying I did a lot of tax returns. I did busy seasons and really got to understand partnerships and K-1s. I didn't understand all of it my first year, but after a couple of busy seasons, I got to understand how the mechanics of returns work. I enjoyed it and I'm glad I had the opportunity to see the other side of it. I always talk about this tax lifecycle: first, it's the drafting of the returns, then it's the audit, then you get the notices and try to resolve them at that stage, go through the audit process. You get an assessment you don't like, so you challenge it and litigate it. That's what we do now.

Samantha Breslow: At Deloitte, you can do some of that at the informal conference board in Illinois, which is like a continuation of the audit. But you reach a point where you can't take it any further, and that's where we get involved, which is a lot more fun. I would rather be coming up with fun ideas and drafting briefs than drafting tax returns. So, I was very happy for the opportunity to come back, and I've been at the firm in our SALT group for almost ten years.

Judy Vorndran: How did that pivot back happen? You were at a big firm; how did the opportunity to go back into law fall into your lap?

Samantha Breslow: I kept up with these guys. I really did want to have the opportunity to come back, and the group has always been good about right-sizing. We were never going to hire someone if we didn't have enough work to keep them busy. When I left the firm, they didn't have the need for another associate. They had just hired Chris Lutz when I was a clerk. But by keeping in touch and making them aware that if there was a need, I would love to fill that role, the opportunity arose for me to come back.

Judy Vorndran: That's interesting. You were able to go in without an undergrad in accounting or a CPA because Jordan's a CPA and an attorney, as am I. It's tough going into accounting without the CPA and understanding financial accounting. Like you said, you have to like numbers because understanding both numbers and law is a unique combination. Many number-oriented people don't understand law, and many lawyers don't understand numbers. Jordan is special in that regard with his master's in tax and undergrad in accounting.

Samantha Breslow: Yes, exactly. The only two folks in our group historically that had both the CPA and the JD were Fred and Jordan. But, yes, coming into an accounting firm without a tax background was challenging. However, at least at Deloitte, half of their tax consultant class were accountants and half were lawyers. You start at the same time and get the same training. The accountants are at a disadvantage because they don't know how to read statutes and regulations, and we were at a disadvantage because we didn't know accounting concepts or how to use Excel or really any basic things learned in undergrad. It's a unique process, but I think it works.

Judy Vorndran: When I started 30 years ago, they didn't hire lawyers. I was one of the few, and then they realized the need for more lawyers for consulting work and statutory interpretation. CPAs initially felt unseated teaching lawyers how to do tax returns, but that's been resolved. They want all those brains to manage compliance.

Samantha Breslow: It takes a busy season or so to understand what you're doing and get it under your belt. I'm not saying I was in the same place as someone with a CPA, but you don't do tax returns in school either. Even in an LLM or master's in tax, you're not doing tax compliance to the degree you do during busy season. It's a learning process for sure.

Meredith Smith: I love that, Sam. What we always talk about and bring full circle is the relationship component and maintaining those relationships. You kept up with the people you worked with, and when the opportunity arose, they knew who to call. Keeping up those lines of communication, especially with state and local tax, is crucial. You can't know it all because there are multiple codes. I love that maintaining relationships brought you back, which is something we value and is the crux of this podcast.

Judy Vorndran: Yeah, because all the people that make up what we do, what we go to IPT for, and that is to professionals’ taxation. Just that network is huge. When you were at Big 4, as was I, when I left, I thought, "Oh my gosh, I don't have a SALT deck in DC anymore," but I had a SALT person in DC because I've been in different organizations. I know different people. I worked with David Hughes on a whole issue in Chicago, Illinois, about the signatory for DocuSign supplies. How do you know what the interpretation of a law is or how it gets applied without talking to people to see how it gets applied? You're looking at the law and think, "Can I get away with this? This isn't literally a wet signature." Just silly things like that are important.

Samantha Breslow: Yeah, absolutely. Being able to call a practitioner in another state and ask them— I did that with you, Judy, with Colorado, to ask you, "What's going on with the locals? This is what I'm seeing. What are you seeing?" It's important to be able to do this. At least you feel like you're not going crazy. I mean, you are crazy, but you're not going crazy. It's just part of the process.

Meredith Smith: Great. We'll come back to talking about the perception of Colorado as an out-of-state, because I thought I was giving you a segue. But I want to talk through some of the fun case stuff. Do you have some memorable cases that you'll never forget, either good or bad, best or worst, that you're open to sharing with us?

Samantha Breslow: Yeah, I'll start with the good. I think that's more fun. And I'll start with a win because there aren't that many wins in the scheme of things, at least within my career so far. We do ultimately settle a lot because it's in the best interest of the taxpayer. Even some of the strongest cases, I remember I had one with Illinois, a business/non-business income issue. Is it the factor of the subsidiary or the parent? We settled this for like 80 or 90 cents on the dollar, meaning we paid like 10 percent interest. It's hard to justify litigating a decision to the end when you're getting such a good settlement. The strongest ones often do settle. Getting a win is fun. Jordan and I just had a big win in Oregon. It's still ongoing. We won on a motion for summary judgment on the main legal issue. I won't talk about the merits of that case, but I think why that case was fun.

It was fun because we got involved halfway through the process. There are a couple lower courts in Oregon, both part of the tax court. Another firm handled that first case, that first step in the litigation process, and lost. They came to us and said, "We lost. Can you come up with another angle? Is there another theory we could pursue?" Jordan, the team, and I came up with some creative ideas. It was a case where the judge and probably the department knew the answer was egregious. It's an income tax case dealing with apportionment and what sort of apportionment rules are being applied. What was being done was egregious, but the statute has to support you. The statute has to say what you need it to say. I think we raised some creative arguments that got us over the finish line. It's always fun to win. Now we're figuring out how much this is worth, what this decision means in terms of dollars and cents. It's more fun to have those conversations when you won versus when you lost.

Judy Vorndran: If you got a motion for summary judgment, we really don't have a decision except that you got it dismissed. Is it out there for posterity that other people can rely on it? That's something I struggle with, especially when people settle. That's the value of all of us knowing one another; you have to know what's going to happen because a lot of things are behind closed doors. People don't know what position to take if it's a similar situation without talking to one another. Governments don't want some of that stuff out in the public forum.

Samantha Breslow: Yeah, absolutely. It's unfortunate for tax practitioners and taxpayers who want some certainty when they take a position. It's the disadvantage for other taxpayers when you're following a case and letting them be the lead case, hoping they'll get the resolution you want, and then they settle. We have a case in Illinois where that just happened. We're waiting, and they just settled. Now we're trying to figure out what's in that settlement agreement. In most states, there's a confidentiality clause for a settlement agreement, so technically you're not supposed to share the terms. You can probably talk more generally, like how did you settle? Did you settle on a percentage basis? Did you settle on just a number, a merit basis? Was it based on some sort of change in law? You can probably get to an answer that's helpful to your client without them telling you, "We settled for 10%," or "We paid 100 grand."

There's been a lot of back and forth with the city of Chicago, dealing with the transaction tax. You mentioned earlier, Judy, that you had an Illinois five-part test issue. Illinois applies a five-part test for whether it's taxable software. We dealt with that relentlessly with the city of Chicago. One taxpayer got a great deal, and then you're like, "Okay, give us the same deal you just gave them." But in the city of Chicago, you had a change in leadership. Previously, tax counsel was willing to work with taxpayers and resolve issues in a way that made sense, even though they knew their law was bad.

To talk more specifically, the transaction tax applies to SaaS and streaming services in Chicago, all based on the location of use. You could be an out-of-state SaaS provider, but your customers are in Chicago. Or you're not a SaaS provider; you just use SaaS. You use something like Adobe in Chicago. You've got employees working remotely there. You're subject to tax. This got complicated because the city never modified their ordinance to do this. They just put out a bulletin and ruling that suggested these things were taxable and tried to apply it retroactively. There was a constant fight over how far back they could go. We had audits where they tried to go back to 2008 or 2010, way back because the lookback period was six years. It became really complicated. I liked it because I felt I could always provide value to clients, whether shortening the lookback period or something else. It's less of an issue now, but you still see taxpayers who may not be the licensor or the licensee, and it's just not on their radar, especially if they're out-of-state companies with an employee working remotely in Chicago.

Judy Vorndran: Right. We have that issue with our home rule cities in Colorado, where they go back longer because nothing was ever filed. There's no statute, so there's no position. It's difficult to argue some of these cases in terms of facts because we just don't have compliance because it's too confusing to do, and it's de minimis until it's not.

Samantha Breslow: Yeah, when a state doesn't modify their ordinance or statute but changes the way they do things, I don't know if that's necessarily right. You could say you're clarifying the law, which is what they said. But to me, that suggests that your statute never really enforced it in the first place or anticipated it. Sales tax is so old, and nobody wants to update the statutes. They're redefining what's tangible personal property. Really? Amazon could assert they didn't have nexus when delivering in their own vehicles because it was a separate legal entity, or because they had warehouses. The separate legal entity was always interesting to me that it was not nexus-creating, but it was questionable. There are a lot of things factually about how business operates that isn't well suited to the ordinance, especially with front-door delivery now compared to going somewhere and picking it up. It's situs; it's easier to figure out. We don't really have any way when you ship stuff. Sears was Amazon before Amazon was Amazon.

Samantha Breslow: I saw a documentary on that recently, saying how disappointing it is that Sears had financial troubles because they were actually set up better than anyone to do online shopping because they had the catalog. I would read through it every Christmas, make my little marks, and get nothing I wanted. But you're right, whether it's a state like Texas that always taxed data processing or information services and tries to use those broad concepts to tax any sort of technology that's coming out now. It's a problem.

Wisconsin's statute doesn't tax data storage. Like Chicago or other states, they just put out a ruling saying, "We always kind of meant to tax data storage," and got aggressive with that over the last couple of years, taxing for sales tax.

Meredith Smith: Especially with Chicago and the personal property lease transaction tax in reference to SaaS. Companies providing SaaS are providing a service, so how am I providing a service and paying tax on a personal property lease tax? From a nomenclature perspective, it's odd. You can't just take words—words matter, and they do very much—but in some cases, the words are tossed around and ambiguous, and you can use them however you want to apply the rules because they don't get it. New products are coming out all the time, and the way they're built doesn't fit nicely into a tax box.

Samantha Breslow: Yeah, Meredith, the ordinance says "non-possessory computer lease." What the heck is that? And how would I know that's SaaS or cloud computing, but for guidance that wasn't published until 2015, 2016? Again, if you don't read the tea leaves, talk to other practitioners and say, "Hey, this is what's coming down the pike. I've heard from the grapevine that this is how the city of Chicago's planning to enforce this," you could be caught off guard and potentially not comply. You always want to comply if you know about it.

Judy Vorndran: Right, exactly. So, did you have a loss that was particularly crushing or irritating?

Samantha Breslow: Yes, actually, one of my first cases when I joined Reed Smith, I didn't get a chance to argue it, but it was a Maryland sales tax case. I think the reason it was frustrating, and this was before South Dakota v. Wayfair, was because I remember the partner who argued it, he's amazing, and I'm sitting in the gallery, and he's saying, "I don't know if this is so much an apportionment issue as it's a nexus issue, right? This business doesn't have nexus in Maryland, period. So, whether or not they should pay tax here, they don't have nexus." And the judge, the Court of Appeals, he said, "Counsel, it sounds like an apportionment issue to me." It was almost like they didn't know what nexus was, and then ultimately, we lost.

It was frustrating because I felt the judge didn't understand the legal arguments. Maybe it was our fault, maybe it was the client's fault because it was really complicated, and the facts weren't super clear. That was a frustrating loss, probably because it was one of my first, and we were all new to it. You remember those ones the most.

I think some of the losses, as I've matured in my career, aren't as frustrating. I recognize that sometimes losing happens because you make decisions that make sense in the best interest of the client, and you didn't have all the right facts, or the laws weren't in your favor. Some of those losses, I think, stick with you more than others.

Meredith Smith: It does hurt, and it's frustrating to deal with things like that. Sam, we're almost out of time, but I do want to ask, you've mentioned remote work, and that's something that's still ongoing. What trends do you see happening in the tax world right now? Is there anything that we should be aware of in the next six months to a year?

Samantha Breslow: Sure. Remote work is probably the biggest issue, especially for income tax. There are a lot of states figuring out how to get money from those who are working from home in different states. Like New York, they have the convenience of employer rule. A lot of states have to figure out how to tax these employees or their companies, whether they'll try to adopt similar rules or create new ones.

Another trend I see is more focus on digital goods and services. States are figuring out how to tax things like SaaS, cloud computing, and other digital transactions, which traditionally didn't fit neatly into tax codes. This will likely continue to evolve as technology progresses.

Judy Vorndran: They pull them all down from the website? They pulled all the FYIs down.

Meredith Smith: Yes. Many years ago. They argued. They were still there. No, they redid them and took all everything down and then put some things back up. So, everything that's historical is no longer accessible.

Judy Vorndran: It's somewhere, but it's not out for public consumption. So there definitely was a sanitation program that went through under the premise that some things aren't current anymore. It's probably not valid. We have to look at everything again. So, I don't know if there's a way to caveat that now, because I wasn't the one who did it. I just remember we're like, what? We have that. We like that. We don't, we want that out there. And, um, like, could you have it and say this is good for now? I don't know what they did, but they pulled a bunch of stuff down. This is many years ago before COVID even, but it was an uproar and practitioners because, like, this helps us get solid around this unique position to at least compare and contrast.

Judy Vorndran: Yeah. Yeah. The way they got to them in Chicago

Samantha Breslow: Was a FOIA request, a Freedom of Information Act request. So, give us everything. And then they didn't. So then, um, so then they sued him to give them everything.

Samantha Breslow: But then you have to start doing stuff like redacting because, you know, we would do these for our taxpayers, or our clients and we didn't know that they were going to be published because they weren't. So, then you've got to go back and make sure there's nothing that's revealing. Right. And that's time. That's man hours. AI can't do all of that.

Judy Vorndran: No, that's why the city didn't want to publish them. So, they didn't want to have to go back and do the work. Oh, yeah, the manpower and they don't have it. They're a government. They don't have the resources to have that kind of bandwidth or time or expertise.

Samantha Breslow: But to not offer the service of getting one of those rulings is asinine because I mean, let's be real. Most of the time. They're not taxpayer friendly, right? Like the decisions, not most of the time, but a lot of the time they are confirming taxability or confirming sourcing issues that aren't so favorable. And so, you know, you would think the department would want to have that on their books to get more taxpayers to comply.

Judy Vorndran: I would think that's why, I mean, we've gotten them, you know, we've always got them put back in the budget, but I mean, we definitely had some consternation over the years about them saying, we don't want to do them anymore. And advocating for not doing them and practitioners have an uproar, but, you know, it depends on who knows, like, taxpayers don't know this. Like, it's so many taxpayers know nothing, right? We know because we look, but they're not tracking to that. So, they assume the government's right or whatever, you know, so there's just there's a lot. I think a lot of people even handle audits without calling an expert. I think they can self-serve and they miss. To be honest and do things they probably shouldn't have done if they just spoke to counsel at the outset. Yeah.

Samantha Breslow: And with those, I mean, most of the time I, when I have clients that want some sort of ruling on an issue, like I did one in Mississippi on landscaping services, um, or in California, and the taxability of a subcontractor and whether that's a lease or a service, you they want those rulings because they want their competitors to be treated the same way that they are.

Samantha Breslow: Sometimes it's not like they don't want to pay the tax. They just don't want to pay the tax. If their biggest competitor is not paying the tax, they want this to all be public.

Judy Vorndran: Yeah, no, good point. That's it really does create parity. And there is a lot of that disparity, which becomes problematic for business. And that's why it's so important they be published.

Meredith Smith: So, this year at IPT, you taught the top 10 case class, which is usually generally pretty popular. So, what any case in particular of those top 10 that really sticks out, um, that like you liked or didn't

Samantha Breslow: Like? So, I've spoken for the Income Tax Committee pretty much like every year, but I never done the top 10 cases. I was kind of shocked like how big that audience was like every single chair had a button in pretty much. But, um, I also ended up having, I did a last-minute presentation on, um, taxability of digital services as well with my, with my former colleague, Chris Lutz. Uh, but, but anyway, uh, yeah. That one was fun because it was a good audience and, uh, I talked about tractor supply already. I think that's a big one for. For taxpayers to be aware of, but, um, another one that I think is really important is the case out of Ohio. It's a gross receipts tax case. Dealing with sourcing, so we had a lot we had several cases in Ohio about sourcing of services. This is sourcing of sales of TPP and the ultimate destination. Because you may remember, I feel like 2018, maybe we had the Greenscape's case and the Dixon case and all of those around how do you source service receipts under the Ohio commercial activity tax? And now we had a few more dealing with, you know, the numerator and the denominator, because under the Ohio CAT, you have to hit a certain threshold in order to file, which is like 150 grand. So, this is a very large company that had.

Judy Vorndran: We should probably stop and define what gross receipts tax is.

Samantha Breslow: So, Ohio commercial activity tax is a gross receipts tax. Meaning it doesn't matter if you make any money, if you have receipts from sales, period, you're paying a tax on it, which really penalizes, you know, low margin businesses or companies that have lost because they're still paying a tax regardless of whether they have net income or not. So, so it's different from an income tax, obviously, where you take your total gross receipts, your deductions, and you come to a taxable income. And, um, this is just pure gross receipts. And then you, you pay tax on the gross. So, the case out of Ohio, um, was you hit 150 grand and then all of your receipts above that threshold are subject to the tax. And, um, they were basically excluding receipts. They were trying to say that, um, a certain portion of their receipts should not be included because they were not sourced to Ohio. Um, because they ultimately got transported out of state. So, they went to a distribution center and then went out of state. So those receipts should be excluded from the numerator. And Ohio said, no, like, you're shipping it to an Ohio location. It stops there. We don't really care what happens. If it ultimately goes to another state, it's stopping in Ohio and we're going to source it to Ohio. And it was really about whether they were hitting the filing threshold of that 150 grand because if you exclude all of those receipts that were ultimately shipped out of state, they're, they're not hitting the threshold. They're not paying any tax. So, it was a huge, it was millions of dollars in gross receipts. So, it was a huge, huge deal for that company. And so that's another one where the department position is very, um, aggressive, I think. And then I also think other states are looking at that and going, huh, we should, we should be doing that too.

Judy Vorndran: We need more money.

Samantha Breslow: Yeah, especially Ohio. I mean, Ohio has never been an overly taxpayer friendly state in my experience.

Judy Vorndran: No, but we can talk about the commercial activities tax there too. That's a gross receipts tax. Right. So, um, Texas, Washington, Oregon.
Transcript 3 of 4.

Meredith Smith: Sam, as a non-Coloradan, how do you explain or work through some of the nuances our state has when we, as in-state practitioners, have a hard enough time explaining our nuances to in-state businesses? What's that like?

Samantha Breslow: It's a challenge. As I mentioned, I did come to Judy because I think of her in Colorado going hand in hand for the locals. I've had to shift the way I advise taxpayers. Historically, when doing multi-state taxability nexus, we'd advise them to just register in the state and maybe in some of the biggest cities like Denver or Commerce City, and not worry about the rest. That's bad guidance now. With most cities adopting the model ordinance and participating in SUTS, it's a whole revamp. I've told Judy that I represent several remote sellers that have been hammered by these localities.

One remote seller, a purely remote seller but a bigger company, did voluntary disclosures in a couple of big cities. Those were fine, but then we started getting little nibbles from other cities. Now, a private audit firm is coming on behalf of several other cities. My question for Judy was, if I give a mouse a cookie, will it ask for a glass of milk? Because the amount of liability in these cities isn't much, but typically, you sign some sort of NDA or non-solicitation in the unclaimed property space, which bars third-party audit firms from soliciting more cities. These firms won't agree to something like that, so what allows us to cut this off? Can't they just keep coming back?

Judy Vorndran: Yes, practically, maybe they don't. But that remains to be seen. Strategically, I advise clients to pay very close attention to when the cities adopted the model ordinance and began participating in SUTS. If they're trying to go back before either of those dates, I'm fighting it. I'm not going to fight it where the cost of paying me exceeds the tax, but I'm going to fight it because I don't think they have any legal basis to require collection for a remote seller.

Samantha Breslow: That is consistent with what you think, Judy?

Judy Vorndran: Yes, but it's challenging. I've found that software collects the tax without the taxpayer knowing it, leading to voluntary collection without realizing what sales tax meant at the destination. That's a problem between automation and business experience. There's a huge disconnect there and then there's the SUTS system. Collecting and remitting it might be easier, but it all depends on your facts. The future filing is problematic depending on your facts. If you're a remote seller with the capacity, already collecting tax in other places, what is it to add a few more and get activated in SUTS? Some cities have dropped the license fee, but it used to be significant, which is why people don't do it.

We have a big problem here, and its always facts and circumstances based. How much legal advocacy do you want to fight in a city like Dakota with 10,000 humans? Some cities are more assertive, and there are groups doing audits on behalf of all. These third-party auditors have the right to audit small cities, and they can do it on behalf of others. Even if there's an NDA, they still know the information and can tell another city to go after the taxpayer.
I hope before the end of my career, we have some parity. Everyone will get more money if you make it easy. But everybody's been holding firm to their rules. You're not making the taxpayer any happier, and this is a voluntary system. Be nicer to them and make it easy because people don't need hard stuff, and everyone will win. But it doesn't work that way.

Samantha Breslow: Yeah, I got yelled at once for saying that SUTS made things easier. But did you see that the city of Lakewood and Wayfair settled their case?

Judy Vorndran: Oh, I didn't see that yet.

Samantha Breslow: Yes, the settlement agreement is not public, so we don't know exactly what they agreed to. That case wasn't going to give us a complete answer on whether what the cities are doing with the model ordinance is constitutional. Wayfair is delivering big pieces of furniture, so it's not the same as a traditional remote seller delivering via common carrier. It's been something we've been following as a task force. Now that it's settled, we have no idea.

Samantha Breslow: Whenever I bring this up, folks say there's a case pending, but I don't think it will give us the resolution we want. And it didn't, it settled.

Judy Vorndran: Lakewood was arguing retroactive nexus, but it wasn't the same framework as the model ordinances. These have been adopted over a varied period for the last 10 years. How can it be constitutional if every city is not in it?

Samantha Breslow: I think these third-party audit firms know you're stuck between a rock and a hard place. I've been able to cut some breaks in a couple of cities by negotiating. I'm curious if you've engaged in any settlement activities.

Judy Vorndran: I just settled a half million down to 175, which I thought was disheartening. If we had more cities like that, imagine how cumbersome it would be for a good faith taxpayer trying to do the right thing. We didn't even talk about leveling the playing field.

Judy Vorndran: Comparing our state to Illinois, leveling the playing field is so complicated to enforce. Illinois had a 6.25 state rate, and remote sellers were subject to both state and local taxes, having to deal with destination sourcing for sales versus origin sourcing for in-state businesses. It's a mess.

Samantha Breslow: There are a couple of pending cases as to whether it's constitutional. There's pending legislation to get rid of the wonky exception for having a little bit of physical presence in the state. It's a mess for remote and in-state sellers.

Judy Vorndran: Well, thinking about people drop shipping from foreign markets into the customer, it's problematic at best. Amazon doesn't always source from the local warehouse, so how is anyone supposed to track that stuff? Once again, it goes to origination, destination, and all that stuff.

Samantha Breslow: When a state needs a flow chart to decipher its law, it's probably a sign that it violates due process because it's so cumbersome to use.

Judy Vorndran: I was just in Michigan. They haven't changed their sales tax since 1996. No local taxes, and it has to be voted in. I've been in like Michigan, Chicago, but I have family that lives off Lake Huron now. And, um, of course, I got to look at the sales tax stuff more tightly now that I'm there.

Judy Vorndran: And, you know, they haven't changed their sales tax since 1996. It's been 6.25 percent or whatever forever. It has to be voted in. There's no local taxes. And I thought, you know, why is it that Michigan has not changed a lot, like, 28 years? And all our other states are going crazy, wonky, you know, Indiana has one rate.

Judy Vorndran: I mean, why can't we see more of that? And then they disperse the, you know, based on population or something, you know what I mean? So why do we have all these crazy little jurisdictional problems? And I get they want autonomy and they have to pay for their services, and they should get it based on their population needs.

Judy Vorndran: But also certain basic services are just a necessity. So it is challenging to deal with that and how each state kind of approaches it is so different, which, of course, is why we have a career.

Samantha Breslow: Yeah, if I were a state, I would do more Texas way, broadening the base, taxing more services and not increasing the rate.

Judy Vorndran: Or South Dakota. You know, they tax massages and CPA services. They don't have legal services, by the way. Yeah. I was at a firm that had a very big office in South Dakota. I never cared about South Dakota until I had some audits there and dealt with clients in South Dakota. And I thought, Oh my gosh, this is a very interesting tax structure.

Judy Vorndran: Compared to a lot of other states. Um, yeah, and I mean, massage is like, you got to be kidding me. So, like, all services are taxable, but the lawyers are smart enough to advocate for not having legal services taxable, but the CPAs were not.

Samantha Breslow: Yeah, I don't know why states do some of these ways. They think that the taxpayers will view it more favorably one way or the other.

Judy Vorndran: Yeah, we have two political and not always beneficial to taxpayers, voluntarily complying.

Meredith Smith: Well, yeah, I think then on that note, Sam, thank you so much for your time, your collaboration, your partnership with us. We really appreciate having you here.

Samantha Breslow: I have to somehow push Jordan's record of two appearances though. So we'll have to do this again.

Meredith Smith: All right. We'll work on that. When your leveling the playing field case comes back or comes out, we'll have you back and you can talk through that. You can give us a little straight from the horse's mouth. So that is another episode of Saltivation. Till next time.