Question 1

A taxpayer wishing to reduce the negative tax effects of the application of the unitary theory might:

Accepted Answer

A) affiliate with a service division, like one in marketing. 
B) add a profitable entity to the unitary group. 
C) disengage unitary operations with the most profitable affiliates. 
D) a and c 
E) All of the above. 
A) affiliate with a service division, like one in marketing. 
B) add a profitable entity to the unitary group. 
C) disengage unitary operations with the most profitable affiliates. 
D) a and c 
E) All of the above.

Question 2

Almost all of the states tax a limited liability company as a ____________________ entity for income tax purposes.

Accepted Answer

Falselow-t

Question 3

In determining taxable income for state income tax purposes,state income tax refunds typically constitute a(n)____________________ modification.

Accepted Answer

The answer of In determining taxable income for state income...

Question 4

A few states recognize an entity's S corporation status,such that taxable income flows through directly to shareholders,but they still assess a state-level tax on the entity.

Accepted Answer

A) True 
 B)False

Question 5

Double weighting the property factor effectively increases the tax burden on taxpayers based in the state,such as corporations with in-state headquarters.

Accepted Answer

A) True 
 B)False

Question 6

Match each of the following terms with the appropriate description, in the state income tax formula.
a.Addition modification
b.Subtraction modification
c.No modification
-Treasury Bond interest income

Accepted Answer

The answer of Match each of the following terms with...

Question 7

The model law relating to the assignment of income among the states for corporations is:

Accepted Answer

A) The Uniform Division of Income for Tax Purposes Act (UDITP
A) . 
B) The Multistate Tax Treaty. 
C) Public Law 86-272. 
D) The Multistate Tax Commission (MT
C) . 
A) The Uniform Division of Income for Tax Purposes Act (UDITP
A) . 
B) The Multistate Tax Treaty. 
C) Public Law 86-272. 
D) The Multistate Tax Commission (MT
C) .

Question 8

Match each of the following items with the appropriate description, in determining whether sales/use tax typically must be collected.
a.Taxable
b.Not taxable
-Prescription drugs

Accepted Answer

The answer of Match each of the following items with...

Question 9

State B applies a throwback rule,but State A does not.General Corporation is taxable in a number of states and made a $100,000 sale from its A headquarters to a customer in B.This activity is not sufficient for General to create nexus with B.In which state(s)will the sale be included in the sales factor numerator?

Accepted Answer

A) Only in A. 
B) Only in B. 
C) In both A and B, according to the apportionment formulas of each. 
D) In neither state, under the doctrine of indeterminate destination. 
A) Only in A. 
B) Only in B. 
C) In both A and B, according to the apportionment formulas of each. 
D) In neither state, under the doctrine of indeterminate destination.

Question 10

In computing the property factor,property owned by the corporation typically is valued at its ____________________,plus the cost of additions and improvements,but without adjusting for ____________________.

Accepted Answer

original (

Question 11

Typically exempt from the sales/use tax base is the purchase of seed and feed by a farmer.

Accepted Answer

A) True 
 B)False

Question 12

Node Corporation is subject to tax only in State X.Node generated the following income and deductions.State income taxes are not deductible for X income tax purposes.
   
a.The starting point in computing the X income tax base is Federal taxable income. Derive this amount.
b.Determine Node's X taxable income, assuming that interest on X obligations is exempt from X income tax.
c.Determine Node's taxable income, assuming that interest on X obligations is subject to X income tax.

Accepted Answer

The answer of Node Corporation is subject to tax only...

Question 13

Net Corporation's sales office and manufacturing plant are located in State X.Net also maintains a manufacturing plant and sales office in State W.For purposes of apportionment,X defines payroll as all compensation paid to employees,including contributions to § 401(k)deferred compensation plans.Under the statutes of W,neither compensation paid to officers nor contributions to § 401(k)plans are included in the payroll factor.Net incurred the following personnel costs.
 
Net's payroll factor for State W is:

Accepted Answer

A) 0%. 
B) 21.05%. 
C) 28.57%. 
D) 50.00%. 
A) 0%. 
B) 21.05%. 
C) 28.57%. 
D) 50.00%.

Question 14

State A applies a throwback rule,but State B does not.General Corporation is taxable in a number of states and made a $100,000 sale from its A headquarters to a customer in B.This activity is not sufficient for General to create nexus with B.In which state(s)will the sale be included in the sales factor numerator?

Accepted Answer

A) Only in A. 
B) Only in B. 
C) In both A and B, according to the apportionment formulas of each. 
D) In neither state, under the doctrine of indeterminate destination. 
A) Only in A. 
B) Only in B. 
C) In both A and B, according to the apportionment formulas of each. 
D) In neither state, under the doctrine of indeterminate destination.

Question 15

Helene Corporation owns manufacturing facilities in States A,B,and C.A uses a three-factor apportionment formula under which the sales,property and payroll factors are equally weighted.B uses a three-factor apportionment formula under which sales are double-weighted.C employs a single-factor apportionment factor,based solely on sales.
Helene's operations generated $1,000,000 of apportionable income,and its sales and payroll activity and average property owned in each of the three states is as follows.
 
Helene's apportionable income assigned to A is:

Accepted Answer

A) $422,200. 
B) $333,333. 
C) $322,200. 
D) $316,500. 
E) $300,000. 
A) $422,200. 
B) $333,333. 
C) $322,200. 
D) $316,500. 
E) $300,000.

Question 16

Identify several transactions by business taxpayers where state and local tax issues are important.

Accepted Answer

Businesses operating in a mult

Question 17

-Tripp Corporation owns manufacturing facilities in States A,B,and C.A uses a three-factor apportionment formula under which the sales,property and payroll factors are equally weighted.B uses a three-factor apportionment formula under which sales are double-weighted.C employs a single-factor apportionment factor,based solely on sales.
Tripp's operations generated $1,000,000 of apportionable income,and its sales and payroll activity and average property owned in each of the three states is as follows.
 
Tripp's apportionable income assigned to C is:

Accepted Answer

A) $1,000,000. 
B) $430,542. 
C) $333,333. 
D) $200,000. 
E) $0. 
A) $1,000,000. 
B) $430,542. 
C) $333,333. 
D) $200,000. 
E) $0.

Question 18

The benefits of a passive investment company typically include:

Accepted Answer

A) Reduced state income taxes. 
B) Isolation of the entity's portfolio income from taxation in other nonunitary states. 
C) Exclusion of the subsidiary's portfolio income from the parent corporation's apportionment formula denominator in other nonunitary states. 
D) All of the above are benefits. 
A) Reduced state income taxes. 
B) Isolation of the entity's portfolio income from taxation in other nonunitary states. 
C) Exclusion of the subsidiary's portfolio income from the parent corporation's apportionment formula denominator in other nonunitary states. 
D) All of the above are benefits.

Question 19

Leased property,when included in the property factor,usually is valued at ____________________ times its annual rental,less any subrentals.

Accepted Answer

The answer of Leased property,when included in the property factor,usually...

Question 20

Match each of the following terms with the appropriate description, in the state income tax formula.
a.Addition modification
b.Subtraction modification
c.No modification
-Federal ACE adjustment

Accepted Answer

The answer of Match each of the following terms with...

A taxpayer wishing to reduce the negative tax effects of the application of the unitary theory might:

Almost all of the states tax a limited liability company as a ____________________ entity for income tax purposes.

In determining taxable income for state income tax purposes,state income tax refunds typically constitute a(n)____________________ modification.

A few states recognize an entity's S corporation status,such that taxable income flows through directly to shareholders,but they still assess a state-level tax on the entity.

Double weighting the property factor effectively increases the tax burden on taxpayers based in the state,such as corporations with in-state headquarters.

Match each of the following terms with the appropriate description, in the state income tax formula. a.Addition modification b.Subtraction modification c.No modification -Treasury Bond interest income

The model law relating to the assignment of income among the states for corporations is:

Match each of the following items with the appropriate description, in determining whether sales/use tax typically must be collected. a.Taxable b.Not taxable -Prescription drugs

In computing the property factor,property owned by the corporation typically is valued at its ,plus the cost of additions and improvements,but without adjusting for .

Typically exempt from the sales/use tax base is the purchase of seed and feed by a farmer.

Identify several transactions by business taxpayers where state and local tax issues are important.

The benefits of a passive investment company typically include:

Leased property,when included in the property factor,usually is valued at ____________________ times its annual rental,less any subrentals.

Match each of the following terms with the appropriate description, in the state income tax formula. a.Addition modification b.Subtraction modification c.No modification -Federal ACE adjustment

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Special Situations

Corporations: Organization and Capital Structure

Corporations: Earnings and Profits and Dividend Distributions

Corporations: Redemptions and Liquidations

Corporations: Reorganizations

Consolidated Tax Returns

Taxation of International Transactions

Partnerships: Formation, operation, and Basis

Partnerships: Distributions, transfer of Interests, and Terminations

S Corporations

Comparative Forms of Doing Business

Exempt Entities

Tax Practice and Ethics

The Federal Gift and Estate Taxes

Family Tax Planning

Income Taxation of Trusts and Estates

Filters

Exam 15: Multistate Corporate Taxation

A taxpayer wishing to reduce the negative tax effects of the application of the unitary theory might:

Almost all of the states tax a limited liability company as a ____________________ entity for income tax purposes.

In determining taxable income for state income tax purposes,state income tax refunds typically constitute a(n)____________________ modification.

A few states recognize an entity's S corporation status,such that taxable income flows through directly to shareholders,but they still assess a state-level tax on the entity.

Double weighting the property factor effectively increases the tax burden on taxpayers based in the state,such as corporations with in-state headquarters.

Match each of the following terms with the appropriate description, in the state income tax formula. a.Addition modification b.Subtraction modification c.No modification -Treasury Bond interest income

The model law relating to the assignment of income among the states for corporations is:

Match each of the following items with the appropriate description, in determining whether sales/use tax typically must be collected. a.Taxable b.Not taxable -Prescription drugs

In computing the property factor,property owned by the corporation typically is valued at its ____________________,plus the cost of additions and improvements,but without adjusting for ____________________.

Typically exempt from the sales/use tax base is the purchase of seed and feed by a farmer.

Identify several transactions by business taxpayers where state and local tax issues are important.

The benefits of a passive investment company typically include:

Leased property,when included in the property factor,usually is valued at ____________________ times its annual rental,less any subrentals.

Match each of the following terms with the appropriate description, in the state income tax formula. a.Addition modification b.Subtraction modification c.No modification -Federal ACE adjustment

Understanding and Working With the Federal Tax Law

Corporations: Introduction and Operating Rules

Corporations: Special Situations

Corporations: Organization and Capital Structure

Corporations: Earnings and Profits and Dividend Distributions

Corporations: Redemptions and Liquidations

Corporations: Reorganizations

Consolidated Tax Returns

Taxation of International Transactions

Partnerships: Formation, operation, and Basis

Partnerships: Distributions, transfer of Interests, and Terminations

S Corporations

Comparative Forms of Doing Business

Exempt Entities

Tax Practice and Ethics

The Federal Gift and Estate Taxes

Family Tax Planning

Income Taxation of Trusts and Estates

Filters

In computing the property factor,property owned by the corporation typically is valued at its ,plus the cost of additions and improvements,but without adjusting for .