BLAKE BOOKSTAFF v. DAVID GERREGANO, COMMISSIONER OF REVENUE, STATE OF TENNESSEE - Articles

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Posted by: Landry Butler on Dec 20, 2017

Court: TN Court of Appeals

Attorneys 1:

Herbert H. Slatery, III, Attorney General and Reporter; Andre´e S. Blumstein, Solicitor General; Charles L. Lewis, Deputy Attorney General; and Jonathan N. Wike, Senior Counsel, for the appellant, David Gerregano, Commissioner of Revenue, State of Tennessee.

Attorneys 2:

John A. Lucas, Knoxville, Tennessee; G. Michael Yopp and Christopher A. Wilson, Nashville, Tennessee, for the appellee, Blake Bookstaff.

Judge(s): FRIERSON

In this action, the Tennessee Department of Revenue (“the Department”) sought to collect unpaid franchise and excise taxes owed by a dissolved corporation from its former shareholder. The trial court entered a judgment in favor of the shareholder, determining that the Department could not collect on the assessments originally issued in 2008 and 2009 due to the six-year statute of limitations contained in Tennessee Code Annotated § 67-1-1429. The trial court also determined that the shareholder was not a “person” or “taxpayer” subject to franchise and excise taxes because those taxes are assessed solely against entities such as corporations. Finally, the trial court determined that the shareholder had no personal liability for the taxes owed by the dissolved corporation absent proof of a fraudulent conveyance. The Department timely appealed. Determining that the trial court erred in its construction and application of the applicable tax statutes, we reverse the judgment in favor of the shareholder.

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