Exam 24: Multistate Corporate Taxation

A state sales tax usually falls upon:

A state can levy an income tax on a business only if the business was incorporated in the state.

Kim Corporation,a calendar year taxpayer,has manufacturing facilities in States A and B.A summary of Kim's property holdings follows. ​ *Unrelated to Kim's regular business and operations. Determine Kim's property factors for the two states.A's statutes provide that the average historical cost of business property is to be included in the property factor.B's statutes provide that the property factor is based on the average depreciated basis of in-state business property.

In most states,a limited liability company (LLC) is subject to the state income tax:

Although apportionment formulas vary among jurisdictions,most states use the same three factors in the formula.The factors are ____________________,____________________,and ____________________.

A use tax applies when a State A resident purchases:

Garcia Corporation is subject to tax in States G,H,and I.Garcia's compensation expense includes the following. Officers' salaries are included in the payroll factor for States G and H,but not for I.Compute Garcia's payroll factors for G,H,and I.

Hambone Corporation is subject to the State E capital stock tax.The tax is levied at 2% of the entity's net worth that is apportioned to E.Hambone conducts 30% of its operations in State E.Hambone's current book balance sheet is as follows,with amounts in millions.Compute Hambone's liability for the E capital stock tax.

A typical U.S.state piggybacks its collections of the corporate income tax,by letting the Federal government collect and remit the corresponding tax to the state.

Sylvia spends time working at the offices of her employer as a consultant to clients who are located in three different U.S.states.To which state(s)' payroll factor(s) is Sylvia's compensation assigned? Apply the general UDITPA rules.

Typically,sales/use taxes constitute about 20 percent of a state's annual tax collections.

Most states exempt consumer purchases of groceries from the collection of the local sales tax.

Most of the U.S.states have adopted an alternative minimum tax,similar to the Federal system,in taxing the income of corporations.

In most states,a consolidated corporate income tax return:

The sale of groceries to an individual probably is exempt from sales/use tax under the _________________________ rule.

A ____________________ tax is designed to complement the local sales tax structure,to prevent the consumer from making no- or low-tax purchases in another state,outside the U.S.,or online,and then bringing the asset into the state.