SALT specialist Attorney knows scope of 'Multistate Taxation in Digital Age' of today

By Sheila Pursglove Legal News Lynn Gandhi, a partner at Honigman in Detroit and an adjunct professor at Wayne Law, remembers when she would put a phone receiver into a black box on the desk to connect to the Internet. Students in her "Multistate Taxation in the Digital Age" class might chuckle, but they also learn that the digital age not only made on-line research fast and easy, it dramatically changed the landscape for state revenue purposes. "We live in a service economy with consumer purchases of digital consumables," Gandhi says. "Our sales tax laws were developed around a manufacturing environment where 'goods' were shipped. Today, it's not clear 'where' services are performed, or where the 'benefit' of a purchase is received. These are concepts more recently adopted by states in developing their state tax regimes, the terms are mostly undefined, not settled by case law, and create uncertainty for state governments facing revenue constraints." She enjoys the challenges in explaining a complicated area of the law in a way her students can understand. "Every time I prepare for class, and read a case I've read over a dozen times before, I'll find something new," she says. "I also hope to convert one or two students into considering a career in tax -- finding a way to differentiate yourself in today's legal market is key to success." Past president of the Michigan Women's Tax Association, and named amongst the Best Lawyers in America, Gandhi is an officer of the Tax Council -- the governing body of the State Bar Tax Section -- and sits on a few professional boards. She is also a registered lobbyist with the State of Michigan, and assists clients in tax legislative matters. "There's always something going on," she says. She is a specialist in State and Local Tax -- a.k.a. SALT. "Most law students don't know that tax isn't a mathematical field; it's about the analytics and allows creative thinking," she says. "SALT litigation is constitutionally based, and you spend most of your time arguing the implications of a tax method and whether it passes muster for commerce clause concerns. Federal tax practitioners don't get that opportunity." Tax law is always changing, so the area never gets stale, she says. "In addition, particularly in SALT, public policy and government come together when we implement new or change old tax laws," Gandhi says. Most states have credit and incentives program to encourage capital investment and development, as well as federal programs such as New Market Tax Credits and Foreign Trade Zones, both of which are driven by tax benefits, she says. Unclaimed property, while technically not a tax, is also an area in which she spends a lot of time, as the audit process and dispute resolution is within the state's Treasury Department. "Right now the biggest issues in state tax are related to the ability of the states to tax internet sales and how much of a company's overall business is subject to tax in each state - these are issues of nexus and apportionment," Gandhi says. Gandhi, who previously worked at Visteon Corporation, CMS Energy, Praxair, CBI Industries, and Arthur Young LLP, has worked at Honigman for five years. "I'm fortunate to have really great clients, and getting to interact with them every day is like working with friends," she says. She started out as a pre-med student at Kalamazoo College before switching to economics and history. "A bad result on a lab practice drove me to what I really enjoyed," she says. "Economics gave me the analytics I excelled in and history satisfied the query of 'why.' I was drawn to the law for its impact on both history and economics, which is impacted by the events occurring in society today." She holds an LL.M in Taxation from New York University School of Law, and a JD from Wayne Law School, where she was Assistant Survey Editor of the Wayne Law Review. "Most law classes I took opened my eyes to a whole new way of thinking. I enjoyed the intersection of problem solving and public policy, the puzzle-solving aspects of the transactional side of tax law, and later I was exposed to tax litigation and the excitement that litigation brings." While working at Arthur Young in Chicago, she started taking night classes in accounting to better understand the lingo of financial reporting; she accumulated enough credits to take the CPA exam, and is a registered CPA in Michigan and Illinois. "Of course, the tax classes were easy," she says. "Understanding financial reporting definitely gave me a competitive advantage and was key in landing my first in-house position. It's been a benefit ever since, and allows me to understand the concerns of CFO's, especially for publicly held companies, as well as business operations. I think it also makes me more practical in the assistance I can provide." Gandhi started in the area of federal tax law and handled state tax matters as they arose. "As the area became more and more complex, and states became more aggressive in auditing, that created an expansion in the area of litigation, which naturally followed from planning the transaction, managing the audit, contesting the assessment, and finally, litigating the issue in court," she says. "I also do a significant amount of work in the area of incentives associated with industrial and urban land development. I handled real estate matters while at Visteon, and development was a natural fit with my tax and government affairs experience." Her years at Ford/Visteon were an exciting time during the spin-off, and the challenges that the first few years brought in developing an in-house tax function for a Fortune 250 company. Gandhi moved over to the General Counsel's Office after a few years, and had the opportunity to create Visteon Village in Belleville -- now known as Grace Lake Corporate Center. "We were busy every minute at Visteon and I worked with some really amazing folks," she says. "It was my first opportunity to learn about the uniqueness of the automotive industry, and I've always loved manufacturing." A Detroit-area native and grad of Berkley High School, Gandhi as a college student enjoyed a period spent in Italy, living with a family with two children that spoke limited English and where she learned Italian and engaged in everyday life. "While they lived in a nice apartment, most clothes were still hung on a line to dry. Dinner was prepared from scratch every night, with pasta always first. I was able to travel with them to visit relatives and really lived like an Italian. And of course, I loved the amazing hot chocolate at Piazza Signorina." Gandhi is married to an attorney -- "But his specialty is Intellectual Property so our kids are spared hearing about the technical area of our work." Their son is pursuing a bachelor's degree in computer science at Lawrence Tech, while their daughter is in fourth grade. "I get the best of both in that I have wonderful IT tech support on the weekends, and all the joys of still having a child young enough to find delight in the world every day -- especially if we're having pasta for dinner." Published: Fri, Jul 13, 2012

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