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Delaware High Court Tosses State Operating Losses Policy (1)

Nov. 30, 2021, 4:45 PMUpdated: Nov. 30, 2021, 6:18 PM

The Delaware Supreme Court struck down a state tax policy on the application of net operating loss deductions for multistate corporate taxpayers, clearing Verisign Inc. of liability for $1.7 million in back taxes and fees.

The high court invalidated a “longstanding, but non-statutory” policy of the Delaware Division of Taxation, finding that the agency had exceeded its statutory authority. The policy in question prohibits corporate taxpayers that file their federal tax returns with a consolidated group from claiming a net operating loss deduction in Delaware that exceeds the consolidated net operating loss deduction on the federal return.

Verisign, a ...

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