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On July 21, the Washington Department of Revenue (“DOR”) issued its analysis of the Court of Appeals’ decision from March 30, 2020, in LendingTree, LLC v. Dep’t of Revenue, no. 80637-8-I (Wash. App. Ct. Mar. 30, 2020).  As set forth in the analysis, from the DOR’s perspective, the LendingTree court followed the existing Washington Business and Occupation tax (“B&O”) attribution rules and guidance and did not create a new interpretive legal framework.[1]  Although the DOR lost the case, and the court held that LendingTree’s receipts could not be sourced based where its customers’ customers were located, the DOR’s response suggests that they are factually distinguishing the case and will continue to attribute receipts to the customer’s customer location if that is where it determines the benefit of the services occurs.

On Friday, July 24, 2020, the Commonwealth Court of Pennsylvania issued its decision and order on the Pennsylvania Department of Revenue’s motion to intervene in the highly-anticipated case of Synthes USA HQ, Inc. v. Commonwealth of Pennsylvania, No. 108 F.R. 2016.  The Synthes case is noteworthy not only because the Commonwealth Court addresses, for the first time, the Department of Revenue’s hotly debated interpretation of the state’s former “costs of performance” statute, but also because…

The Baker McKenzie State and Local Tax (SALT) Subpractice Group is presenting a series of short webinars to keep members of the SALT community abreast of recent developments in these less than certain times.  We hope you will attend so we can stay connected as we address these issues together. The next session in the series, Apportionment Sourcing the Remix, will take place on Wednesday, April 29 at 1:00 pm ET.  If you would like…

Many employees continue to telecommute due to the COVID-19 outbreak.  As discussed in our previous blog post on state tax nexus and apportionment issues, out-of-state employers may need to consider whether a telecommuting employee’s activities could create nexus, exceed Public Law 86-272 protections, or impact the employer’s state income tax apportionment factor (particularly in states with a payroll factor or a sales factor where receipts are sourced based on cost of performance).