Martin Eisenstein and Nathaniel Bessey Pen State Tax Notes Cover Story

An article by managing partner Martin Eisenstein and partner Nathaniel Bessey, “Wayfair and P.L. 86-272 in a Services Economy,” is the cover story in the November 5, 2018, issue of State Tax Notes. In the piece, Eisenstein and Bessey explore the broader potential impacts of the Supreme Court’s recent opinion in South Dakota v. Wayfair on state tax issues facing service providers. While Wayfair eliminated the bright-line physical presence rule for nexus, it did not alter the protections of Public Law 86-272, and service providers, like other out-of-state retailers, may continue to argue that they are protected from a foreign state’s income tax so long as they do not engage in activities in the jurisdiction beyond solicitation. Further, as the article discusses, even after Wayfair, service providers still have arguments against the imposition of foreign state taxes under the Commerce Clause and Due Process clauses.