Taxpayer Sought Sales Tax Refunds for Tax Paid on Bad Credit Card debts
In Home Depot USA, Inc. v. State of Michigan, et al., Michigan Court of Appeals, No. 301341, May 24, 2012; leave to appeal denied, Michigan Supreme Court, Dkt. No. 145412, October 22, 2012, the Michigan Supreme Court has denied a request to review a Court of Appeals decision which held that a retailer that entered into private label credit card (PLCC) agreements with certain finance companies was entitled to a bad-debt deduction for sales taxes remitted on purchases made by PLCC holders who later failed to pay their credit card bills.
The taxpayer had sought a refund of taxes despite having received compensation for the purchases and the tax pursuant to its contracts with the finance companies. The Supreme Court did not believe that the questions presented should be reviewed by the court.