Economic Nexus and State Income Taxes: Responding to Latest Developments

Avoiding Traps Triggered by Royalty Income, Support Activities, Excess Sales and Other Indirect Presence

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


Conducted on Thursday, September 13, 2012

Recorded event now available

or call 1-800-926-7926
Program Materials

This teleconference will provide tax professionals with a review of the latest important developments in court actions, legislation and regulations affecting state economic nexus standards and the practical impact on multi-state corporate income tax compliance.

Description

Tax professionals at multi-state companies must be vigilant about states' economic nexus standards for corporate income taxes. The West Virginia high court recently invalidated assessments against a company with nationwide licensing of trademarks and no other presence in the state.

In addition, Tennessee lawmakers decided to require state pre-approval of any subtraction of inter-company intangible expenses. An Oklahoma court held no nexus for an affiliate that just held trademarks, while a Virginia ruling found nexus based on the presence of a Web server in the state.

As the ranks of economic nexus states swell, tax pros must understand regulatory subtleties, state law variations, and impact of case law to ensure full, accurate compliance. You need a proactive approach to identify where and how nexus is triggered in order to avoid penalties and unexpected tax burdens.

Listen as our panel of experienced state tax advisors thoroughly examines the latest federal and state developments in economic nexus and explains how those changes affect corporate income tax compliance.

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Outline

  1. Recent court developments
    1. W.Va. Supreme Court of Appeals No. 11-0252, Griffith v. State Tax Commissioner
      1. Company with no physical presence did not trigger nexus based on royalty income from licensing trademarks nationwide
    2. Okla. Supreme Court No. 108943, In re: Scioto Insurance Co.
      1. Affiliate in different industry didn't create nexus by holding the taxpayer's trademarks
    3. Minn. Tax Court Decision No. 8168-R, Skagen Designs Ltd. v. Commissioner
      1. Use of in-state merchandisers who made reports and trained customers triggered nexus
    4. Va. Tax Commissioner's Ruling No. 12-36
      1. Virginia server for marketing website triggered nexus
    5. Others
  2. Recent legislative and regulatory developments
    1. Tenn. Senate Bill 2234,
      1. State pre-approval required for any subtraction of inter-company intangible expenses
    2. Others
  3. Related issue: extent to which non-resident partners and LLC members create nexus
    1. Court interpretations
  4. Actions to consider by corporate tax departments
    1. Nexus reviews
    2. Voluntary disclosure agreements
    3. Amnesty program participation
  5. Developments on the horizon in key states and Congress

Benefits

The panel will provide an in-depth analysis of these and other developments and trends:

  • What you need to know about federal and state court decisions and legislative and regulatory developments.
  • How combined reporting, addback and throwback laws indirectly widen states' economic nexus nets.
  • Whether voluntary disclosure or amnesty programs offer opportunities to mitigate penalties.

Following the speaker presentations, you'll have an opportunity to get answers to your specific questions during the interactive Q&A.

Faculty

Jaye Calhoun
Jaye Calhoun

Member
McGlinchey Stafford

Her practice specializes in business state and local taxation and regulatory issues. She has chaired an ABA Taxation...  |  Read More

Karen Currie
Karen Currie

Jones Day

Her practice is in multi-state taxation, particularly in the state and local tax aspects of business acquisitions,...  |  Read More

Mary Reiser
Mary Reiser
Supervising Consultant
BKD

She is attached to the firm's State and Local Tax Services Division and works on returns and compliance issues for...  |  Read More

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