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State Tax Considerations of Financial Institutions: Determining Nexus, Unique Taxes, Filing Requirements

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, August 3, 2023

Recorded event now available

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This webinar will take an in-depth look at state guidelines for taxing financial institutions. Our panel of state and local tax professionals will analyze how states define, tax, and determine nexus for businesses handling cash, credit, and similar assets. They will point out differences in specific state treatment of these institutions and advise tax preparers of the tax nuances to be wary of for this industry.


How a financial institution is defined varies by state. Its reach is far and often extends to mortgage lenders, accounts receivable factoring companies, and credit card processors. The definition is critical because businesses that handle liquid assets are regulated and subject to unique nexus standards, apportionment methods, and filing requirements. Financial institutions are often subject to additional taxes, and this designation can dictate whether a separate, combined, or consolidated return is filed.

In lieu of a corporate income tax, financial institutions could be subject to a state specific taxing regime (for instance, corporate shares tax in Pennsylvania, or an equity capital tax in Ohio, among others). California has separate tax rates for financial institutions, which are higher than those imposed on other corporations. How nexus is determined and income apportioned for financial institutions varies by state. An institution may not have a physical location within a state but may have deposits, loans, or credit card balances that could create a presence there. Tax advisers working with financial institutions and similar businesses need to grasp the current state of state taxation of this industry.

Listen are our panel of SALT experts reviews current state practices for taxing financial institutions, mortgage lenders, savings and loans, and similar organizations.



  1. State tax considerations of financial institutions: introduction
  2. Definition
  3. State taxation of financial institutions
    1. Taxes assessed
    2. Rates
    3. Filing requirements
  4. Nexus
  5. Examples


The panel will cover these and other critical issues:

  • How nexus is determined for financial institutions
  • Review of specialized apportionment rules
  • The impact of being classified as a financial institution on state-specific filing requirements
  • Avoiding potential SALT tax traps


Damin, John
John Damin
STS-SALT Senior Manager

Mr. Damin is a Senior Manager whose primary focus is in state and local income/franchise tax. His state tax experience,...  |  Read More

Lipin, Ilya
Ilya A. Lipin

Tax Principal, Atlantic Region State and Local Tax Practice Leader

Mr. Lipin provides clients with state tax advice in the area of multistate income taxes, sales and use taxes, tax...  |  Read More

Minty, Ozair
Ozair S. Minty, JD, CPA

Managing Director

Mr. Minty is a managing director and the Financial Services Practice Leader for State and Local Tax Services for BDO...  |  Read More

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