Tax Advisers Expect Legal Challenges to Michigan’s Retroactive IBM Fix

Overview


Peter Faber assessed possible issues from Michigan’s retroactive withdrawal from the Multistate Tax Compact. He noted that “the whole concept of retroactivity has been very controversial,” and Michigan’s six-year timeframe is “a long time, so that could be an issue.” Mr. Faber continued that “there are extreme situations where retroactivity is clearly OK. But I think most people feel that in general, retroactive anti-taxpayer legislation is dirty pool, and that the burden ought to be really on the states to show that there’s a good reason for retroactivity.”