Knowledge Center

Thursday, May 08, 2014

HMB's Marilyn Wethekam was recently quoted in Bloomberg BNA's 2014 Survey of State Tax Departments. Her comments appear in the section of the survey devoted to addressing the nexus treatment of non-U.S. Entities.

Marilyn, a partner with Horwood Marcus and Berk's SALT Practice told Bloomberg BNA:

The permanent establishment concept is truly a federal concept which may or may not be accepted by individual states.

''Whether a state adopts it or not, I think it is correct that prior to imposing an income tax a state taxing authority must establish it has jurisdiction, or nexus, over the entity.''

But the analysis does not end with merely establishing nexus over the foreign entity, Wethekam said. ''I think there is a second part to that jurisdictional analysis, namely is there a connection between the taxing authority and the business activity generating the income it is seeking to tax. The recent U.S. Supreme Court decisions addressing the application of the Due Process Clause, in my opinion, support that conclusion.''

To see more of Marilyn's quotes, please click HERE.

Bloomberg BNA's 2014 Survey of State Tax Departments is now available for purchase.

Now in its 14th year, this annual survey clarifies each state's position on the gray areas of corporate income tax and sales and use tax administration, with an emphasis on nexus policies. New portions of the survey this year address sales tax nexus for cloud computing and services.

Topics covered in the 2014 Survey of State Tax Departments include:

  • Corporate Income Tax Nexus
  • Sales Tax Nexus
  • Cloud Computing and Services
  • State Tax Add-Backs
  • I.R.C. §338(h)(10) Elections
  • Bankruptcy Issues
  • Intangible Holding Companies
  • Non-U.S. Entities
  • Throwback/Throwout Rules
  • Income Tax Sourcing
  • Sales Tax Sourcing
  • Multistate Tax Compact Conformity and Combined Reporting

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