Texas Justices Told Tax Deductions Apply To Machine Rentals

Law360 (October 9, 2019, 4:13 PM EDT) -- A heavy equipment leasing company told the Texas Supreme Court in oral arguments Wednesday that the business should be allowed to claim a state franchise tax deduction for delivery and pickup costs it incurs in getting the machinery to its customers.

Sunstate Equipment Co. LLC is trying to overturn a January 2017 ruling by the Third Court of Appeals in Austin that it could not include the delivery and pickup costs in state “cost of goods sold” deductions — totaling about $140,000 with interest and penalties — it claimed for tax years 2008 and 2009.

The case asks the state’s high...

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