[Chugalug] Ot: business attorney

Stephen Haywood stephen at averagesecurityguy.info
Thu Mar 28 00:33:20 UTC 2013

Makes me rethink forming my LLC in TN. :(

Stephen Haywood
Owner, ASG Consulting
T: @averagesecguy
W: averagesecurityguy.info

On Wed, Mar 27, 2013 at 7:59 PM, Mike Harrison <cluon at geeklabs.com> wrote:

> A shy chugalurker just emailed me 2 questions:
> "Where would you, and (briefly) why?  And top 3 specific reasons TN is
> on *your* suck list?
> You know, if you're feeling bored and feel like imparting wisdom, and
> I'd actually like to hear *your* answers to those questions.  Because
> you see things differently than most.... :)"
> My answers:
> As a business owner, I have been attacked by the TDR (Tn Dept of Rev)
> several times. My lawyer for the biggest one:
> http://www.bakerdonelson.com/**carl-e-hartley/<http://www.bakerdonelson.com/carl-e-hartley/>is one of the best in the country, why? Because TN has one of the more
> punative department of revenues for any state. TDR claimed the business
> (HTS Inc aka Chattanooga Online) owed the state of TN > 500k. The audits
> were insane. They wanted us to pay sales tax on vehicles, the building, and
> things we clearly had already paid sales tax on. They lost, but it cost HTS
> a fortune to fight it, approx $30k-50k (i didn't see the final bills).
> TDR also hounded several of my customers, and I got involved. In one case,
> a developer charged a few grand for a functional e-commerce website.  TDR
> "valued" the e-commerce website at the amount of annual revenue it brought
> in.. and wanted sales tax, from the programmer, for the assayed value of
> the website, not what he got paid. In the end, custom web development /
> programming was seen as work for hire, not a taxable product.
> In other case, a system was used for brokering truck loads (logistics)
> and they came after him for a percentage of the fees he made, for the
> estimated percentage of a trip across TN. For example, if the website
> brokered a load from S. Georgia to St. Louis and the brokering fee was $10
> and the truck went though TN for 20% of the trip, they wanted taxes on
> $2.00... Then they went after the value of the load.. Steve moved his
> company and servers to Alabama.
> In fact, if you wonder why some things in internet-land are not subject to
> sales tax, thank Carl Hartley and others for fighting it.
> Personally, I've now been hit up TWICE by the TDR for them claiming that
> 1099-misc income from doing programmming, networking and such, from income
> data they get from the IRS, is supposedly 1099-div (dividends) income and
> they hit me up for not filing it, with penalties. Bob Corkers office got
> involved the second time and fixed it.
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