Tennessee clarifies tax regulations for lobbyists and investment advisers

Tennessee's Revenue Department has clarified key aspects of the Professional Privilege Tax during a recent government meeting, providing essential guidance for lobbyists, attorneys, and investment advisers. The tax is determined based on individual licenses for these professionals, as well as registrations for securities agents and broker-dealers.

A significant point of discussion was the tax payment options available for single-member LLCs. Individuals registered as investment advisers who also operate a broker firm can choose to pay the tax under either their individual license or their business license, but not both. This flexibility aims to prevent double taxation and simplify compliance for professionals navigating multiple licenses.

The meeting also addressed exemptions from the Professional Privilege Tax. Notably, in-house counsel without an active Tennessee license, suspended attorneys, and individuals registered solely as investment adviser representatives are not liable for the tax. Additionally, active U.S. military members who have served more than 180 days in the previous year are exempt from this tax obligation.

These clarifications are expected to ease confusion among professionals regarding their tax responsibilities and ensure compliance with state regulations. As Tennessee continues to refine its tax policies, these discussions highlight the importance of clear communication and understanding of tax obligations for licensed professionals in the state.