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Current California Tax Issues: New Sales Tax Nexus Thresholds, Market-Based Sourcing Rules, Pass-Through Entities, and Local Taxes

Note: CLE credit is not offered on this program

Recording of a 110-minute CPE webinar with Q&A

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Conducted on Thursday, October 24, 2019

Recorded event now available

or call 1-800-926-7926

This course will guide SALT professionals through the complexities of California tax compliance, and provide an update on the latest developments in California business taxation, including market-based sourcing, pass-through entities, local taxes imposed by San Francisco and Los Angeles, and the recently enacted economic nexus standard for use tax registration and collection.

Description

California sales and use, income and franchise, and local tax laws have recently undergone significant changes. Our panel will discuss these changes and address the issues businesses face to comply with California’s ever-changing tax laws.

In the wake of Wayfair, California has now adopted an economic nexus threshold for use tax registration, reporting, and remittance obligations. After the California Department of Tax and Fee Administration (CDTFA) adopted a $100,000 sales or more than 200 transaction threshold on December 2018, the California legislature enacted legislation overriding the CDTFA, increasing the threshold to $500,000 and eliminating the transactions threshold. The legislation also created use tax collection obligations for marketplace facilitators, and various reporting rules for marketplace sellers.

For income and franchise tax purposes, California generally requires multistate businesses to apportion income with a single-sales factor. For sales of other than tangible personal property, California assigns sales under market-based sourcing regulations. Whether a business even has a California filing requirement often turns on the application of these regulations. The California Franchise Tax Board recently held its fourth interested-parties meeting on proposed amendments to the market-based sourcing regulations. The proposed changes could have a significant impact on California income and franchise tax liabilities.

Listen as our panel of experts explains the complex compliance demands of California's business tax requirements, including filing and remitting sales tax, applying the market-based sourcing rules, filing returns for pass-through entities, and other current developments in California business taxation.

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Outline

  1. Doing business in California
  2. Use tax collection after Wayfair
  3. Market-based sourcing rules
  4. Pass-through entity taxation
  5. Other current developments

Benefits

The panel will cover these and other essential issues:

  • When is a business liable for use tax collection in California?
  • What if a business registered for use tax collection under the lower threshold?
  • What constitutes nexus for a service-based business in California?
  • What are the California filing requirements for pass-through entities?
  • When is an LLC required to pay the LLC tax and fee?

Faculty

Cataldo, Michael
Michael J. Cataldo
Shareholder
Cataldo Tax Law

Mr. Cataldo represents corporate and individual clients in state and local tax controversies across the country during...  |  Read More

Thacher, Alex
Alex Thacher
Partner
Armanino

Mr. Thacher leads the firm’s SALT practice, primarily focused on state and local tax consulting, as well as...  |  Read More

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