Multi-jurisdictional Tax Issues Flashcards

1
Q

Nexus: minimum level of contact a taxpayer may have with a jurisdiction to be subject to its tax

A

following may trigger nexus in a state in which a company operates:

owning or leasing tangible personal or real property
sending employees into the state for training or work
soliciting sales in a state
providing installation, maintenance, to customers within a state
accepting or rejecting sales orders within the state or accepting returns.

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2
Q

Calculation of apportionment factor

A

([Property and rent expense located within state / total property] +
[Payroll paid to employees within the sate / total payroll]
+
[Sales from sources within the state / total sales] ) / 3

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3
Q

Allocation of Nonbusiness Income and Apportionment of Business Income

A

multistate corporations approach to the apportionment and allocation of its income; corporation will allocate its nonbusiness income and its business income

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