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Current corporate income tax developments.


* Many states have increased the sales factor or are phasing in a single sales factor over a period of years.

* California conformed to certain AJCA tax-shelter reporting requirements for material advisors and listed transactions.

* A number of states passed laws establishing or modifying passthrough entities' duty to withhold on nonresident owners.


This two-part article discusses a myriad of recent state tax activity in the corporate income tax area. Part II addresses developments on apportionment, filing methods/unitary groups, administration and other significant state tax developments.

During 2005, numerous state statutes were added, deleted or modified; court cases were decided; regulations were proposed, issued and modified; and bulletins and rulings were issued, released and withdrawn. Part I of this article, in the March 2006 issue, focused on nexus, Internal Revenue Code (IRC) Sec. 338(h)(10) transactions, allocable/apportionable income and tax base. Part II, below, covers some of the more important developments in apportionment, unitary groups/filing methods, administration and other significant corporate state tax issues.


A multistate corporation's business income is apportioned among the states using an apportionment percentage for each state with jurisdiction to tax the corporation. To determine the apportionment percentage, a ratio is established for each of the factors included in the state's formula. Each ratio is calculated by comparing the corporation's level of a specific activity in the state to the total corporation activity of that type everywhere. The ratios are then summed, weighted (if required) and averaged to determine the corporation's apportionment percentage for the state. The apportionment percentage is then multiplied by total corporation business income.

While apportionment formulas vary, many states use a three-factor formula that includes sales, payroll and property factors. Because use of a higher-weighted sales factor generally provides tax relief for in-state corporations, most states accord more weight to the sales factor than to the other factors. Changes in the apportionment formula may also be used to provide relief or tax benefits to specific industries or to properly reflect the operations of a particular industry. Recent apportionment developments are summarized below.

Increased Weighting of Sales Factor

* Arizona

For tax years beginning after 2006, corporations will be allowed to annually elect a super-weighted sales factor apportionment formula. If the election is made, the sales factor will be weighted 60% for 2007, 70% for 2008 and 80% after 2008. If a corporation elects the super-weighted sales factor, it must participate in an economic impact analysis tracking the number and value of investments by the electing entities. Further the super-weighted sales factor provisions will not go into effect unless specified targets for investment in the state are met. (58)

* Georgia

HB 191, Laws 2005, phases in a 100% sales factor formula; the sales factor will be weighted 80% for 2006, 90% for 2007 and 100% after 2007.

* Louisiana

For tax years beginning after 2005, HB 679, Laws 2005, increased the sales factor to 100% for businesses primarily engaged in manufacturing or merchandising.

* Michigan

Under SB 634, Laws 2005, the weighting of the sales factor is increased from 90% to 92.5% for 2006 and 2007, and to 95% after 2007.

* Minnesota

A single sales factor apportionment formula is being phased in over an eight-year period, beginning in 2007. (59) For tax years beginning in 2007, the sales factor will be increased from 75% to 78%. The sales factor will then gradually increase each year until it reaches 100% in tax years beginning after 2013.

* New York

A single sales factor apportionment for corporations taxed under Article 9-A (general business corporations) is being phased in; the sales factor weighting will be 60% for 2006, 80% for 2007 and 100% for tax years beginning after 2007. Banks and other corporations subject to Article 32 generally are not subject to single-factor apportionment except with respect to income from management and administration of investment companies. For this income, single-factor apportionment will be phased in over a three-year period with the following phase-in percentages: 50% sales, 17% payroll and 33% deposits for 2006; 70% sales, 10% payroll and 20% deposits for 2007; and 100% sales for tax years beginning after 2007. (60)

* Oregon

SB 31, Laws 2005, accelerated the 100% sales factor formula to be effective for tax years beginning after June 30, 2005.

* Utah

For tax years beginning after 2005, HB 78, Laws 2005, allows taxpayers to make a five-year irrevocable election to apportion business income using a double-weighted sales factor.

Other Apportionment Developments

* Arizona

The Tax Appeals Board ruled that only the net gain on the sale of mortgages should be included in the sales factor and that the mortgage company's sale of the mortgages was not a separate income-producing activity, thus requiring inclusion in the numerator of the sales factor for net gains realized on mortgages backed by Arizona properties and any sales originating from sales activities in Arizona. (61)

* California

The Franchise Tax Board (FTB) provided guidance on what constitutes a "personal service" for purposes of attributing gross receipts to the California sales factor using the "time spread" method, under which the time each employee spends in each state constitutes a separate income-producing activity. (62)

Two decisions during 2005 addressed whether certain treasury functions should be reported at gross or net proceeds for sales factor apportionment purposes. In an unpublished decision, (63) a California Court of Appeal affirmed that a retail store's returns of principal from debt instruments held to maturity are not "sales" within the meaning of the state's Uniform Division of Income for Tax Purposes Act apportionment provisions and, accordingly, are not includible in the sales factor as gross receipts. In a different case, the California Court of Appeal held that receipts from Microsoft's sale of short-term marketable securities must be excluded from the apportionment formula sales factor. (64)

* Indiana

The Department of Revenue (DOR) ruled that the Indiana-source sales of a business that provides financial market data collected in California to customers nationwide via cable boxes and similar means are determined by the subscription fee income received from Indiana customers, because the fee is the income-producing activity that occurs when data is received in Indiana. (65)

In a case involving dock sales, the Indiana Tax Court ruled that sales of beer to Indiana customers were not sourced to the state for adjusted gross income tax purposes because delivery took place outside the state with third-party common carriers acting as agents for the customers in retrieving the beer from the seller's out-of-state breweries and bringing it into Indiana. (66)

* Massachusetts

The Supreme Judicial Court both vacated in part and sustained in part the appellate court's apportionment factor inclusion and sourcing ruling involving the owner of the Boston Bruins hockey team. (67) The court sustained that gate receipts and local broadcast licensing revenues of "away games" were fully sourced to Massachusetts--the gate receipts under income-producing activity/cost or performance analysis, and the broadcast licensing revenues based on "actual use" or where the broadcast is "displayed" to viewers and generates advertising revenue. The court vacated the decision that sourced all national and international broadcast rights to Massachusetts, finding that the commissioner had not identified that a greater portion of the actual use by licensees outside the state occurred in or was "geographically associated with" Massachusetts.

In another case, the Appellate Tax Board (ATB) held that a Massachusetts manufacturer could not rely on the state's foreign-sale presumption to establish a right to apportion its income, because such presumption applies only to allow an entity to source its foreign sales outside the state once the right to apportion has been established. (68)

* Michigan

The Michigan Court of Appeals held the state's sales factor statute unconstitutional to the extent that the statute sourced services performed outside of the state to Michigan for "planning, design, or construction activities" for construction projects in the state. (69)

In a separate development, a change in department policy (70) allows the property factor to reflect the value of films, motion pictures, master negatives, television film and videotapes as tangible personal property, rather than excluding such costs as intangible property.

* New Mexico

Special apportionment rules have been adopted for the publishing industry. (71)

* North Carolina

Effective Jan. l, 2005, an amended regulation excludes from a corporation's apportionment sales factor "substantial" gross receipts arising from an incidental or occasional sale of a fixed asset used in connection with the corporation's regular wade or business. (72)

* Oregon

Under SB 31, Laws 2005, effective for tax years beginning after 2005, the sale of goods from a public warehouse are not thrown back to Oregon when the taxpayer's only activities in the state are limited to storage of goods in the public warehouse and solicitation of sales of the taxpayer's products.

In a separate development, the DOR has adopted a new apportionment rule for publishers. (73)

* Pennsylvania

The Pennsylvania Supreme Court affirmed (74) that a UPS subsidiary without employees could not impute a payroll factor based on affiliated company employees or independent contractors for either corporate franchise or net income tax purposes. The subsidiary had paid for the imputed services using intercompany accounts, booking these costs as "payroll expenses."

* Tennessee

SB 2310, Laws 2005: (1) more broadly defines unitary group for purposes of determining which entities must be included in the financial organization's unitary group; (2) provides that if any member has nexus with Tennessee, the Tennessee receipts of all members (even those without nexus) must be included in the numerator of the receipts factor; and (3) increases the percentage of receipts attributable to the state by requiring a portion of the receipts that currently are not included in the numerator to be included by providing that any other receipts not specifically attributed to Tennessee or to another taxing jurisdiction must be attributed to Tennessee in the same proportion that the enumerated receipts are attributed to Tennessee.

* Texas

A Texas Court of Appeal held the franchise tax earned surplus throwback rule was unconstitutional as it applied to the taxpayer, and consequently the taxpayer was entitled to a refund. (75)

* Wisconsin

For tax years beginning after 2004, AB 100, Laws 2005, sources service income revenues to the location where the benefit is derived and sources revenue from computer software to the location where the software is used.

Filing Methods

* California

The State Board of Equalization (SBE) held in favor of the taxpayer that instant unity was not present on acquiring a target company for purposes of requiring a combined return. The two businesses were deemed unitary at the beginning of the next calendar year, with the SBE noting that in the interim the companies had consolidated operational departments, integrated executive staff and centralized production, distribution and their general operation system. (76)

* Georgia

HB 488, Laws 2005, clarifies the requirements for filing consolidated returns by providing that the commissioner will by regulation provide the period within which the permission to file a consolidated return must be requested. A request for permission beyond such period will not be considered and will result in filing separate income tax returns for the applicable year.

* Idaho

The State Tax Commission ruled that only insurance companies that pay Idaho premiums tax can be excluded from a unitary group's combined return. (77)

* Illinois

An Illinois Appellate Court affirmed that Dow Chemical was unitary with Marion Laboratories only for the year after Dow's 67% acquisition of Marion Labs in return for 100% of the stock of Merrell Dow Pharmaceuticals. (78) The court found for subsequent years that, although certain mutually beneficial relationships between the companies occurred after Marion Labs had severed the earlier ties, such transactions did not occur as a result of integration and centralization of management that produced economies of scale, but were more indicative of a business alliance between a chemical giant and a pharmaceutical giant. In addition, less than 1% of Dow's total sales were made between the groups, and any intercompany loans were either de minimis or priced at arm's-length.

* Indiana

The Indiana Tax Court held that a taxpayer is not required to receive permission to discontinue filing income tax returns on a combined basis and thus granted the taxpayer's retroactive three-year refund request. (79)

* Kentucky

HB 272, Laws 2005, requires filing nexus consolidated returns.

* Missouri

The Missouri Administrative Hearing Commission ruled that a corporate affiliated group that filed consolidated Federal income tax returns was barred from filing a consolidated Missouri income tax return for a given year, because it did not timely make the state consolidated filing election pursuant to an established regulatory deadline. (80)

* New York

The New York Court of Appeals denied (81) hearing the lower court's decision, which had affirmed the Division of Taxation's use of discretionary authority to require combined reporting for Sherwin-Williams and its unitary trademark holding companies.

In another decision involving intercompany transactions, (82) the New York Tax Appeals Tribunal affirmed the Administrative Law Judge's decision regarding Disney Enterprises that (1) exclusion of three subsidiaries from the combined report would be distortive, given Disney's unique inter-group synergies and the absence of arm's-length pricing; (2) royalty income can be properly included in the business allocation percentage without including the related intangible property value; (3) Disney's historical methodology of assigning royalty receipts based on the business location of its licensees was more reasonable than assigning the receipts to the locations of manufacturers contracted by its licensees for the production of the licensed goods; and (4) film masters should be reflected in the property factor at historical cost, rather than the current fair market value including reproduction rights as based on expert appraisal.

* Oregon

The Oregon Tax court held that a corporation formed to oversee a family's investments was unitary and subject to combined reporting despite the separate nature of its business lines, with the court finding centralized management, functional integration and economies of scale. (83)


Tax Shelter

* California

AB 115, Laws 2005, conforms to the American Jobs Creation Act of 2004 tax-shelter enforcement requirements involving the information return filing requirement for material advisors and provides that information return requirements for listed transactions would also apply to listed transactions as defined under Federal and California law.

* Connecticut

SB 1265, Laws 2005, imposes a 75% penalty for the failure to report listed transactions and a 50% penalty for the promotion of abusive tax shelters and also extends the statute of limitation (SOL) in several situations (including increasing the SOL from three to six years for failure to disclose a listed transaction) and provides that a deficiency assessment may be mailed to the taxpayer at any time if the deficiency is due to fraud or intentional evasion of the corporation tax law or its regulations. SB 1232, Laws 2005, effectively accelerates the state's 75% penalty for failure to disclose certain Federal listed transactions to audits beginning after 2005, rather than to income tax years beginning after 2004.

* Minnesota

HF 138/SF 106, 2005 Special Session includes reporting and disclosure requirements for tax shelters with one or more investors that are Minnesota taxpayers. The new law mandates all taxpayers required to file a Federal disclosure statement regarding a reportable or listed transaction to file a copy of that statement with the commissioner. The new law also imposes penalties for nondisclosure and the underpayment of taxes due to participation in these transactions and extends the SOL for assessments relating to these transactions.

* New York

The State Budget for Fiscal Year 2006 (A 6845/S 3671, Laws 2005) includes new reporting requirements for disclosing information on transactions that present the potential for tax avoidance (i.e., a tax shelter). These new reporting requirements are similar to the tax shelter disclosure requirements for Federal income tax purposes. The new law also imposes penalties for nondisclosure and the underpayment of taxes due to participation in these transactions and extends the SOL for assessments relating to these transactions.


* Alabama

Under an amended regulation (84) rulings apply only to the recipient of the request and "have no precedential value of other taxpayers" In addition, rulings can only be obtained on transactions/events that have not yet occurred.

* Arizona

SB 1171, Laws 2005, establishes a managed audit agreement program in which the DOR and the taxpayer work together to audit the taxpayer's books. A managed audit agreement is allowed for the transaction privilege tax, local excise tax and use and luxury tax, with corporate income taxpayers becoming eligible for the program beginning January 2007.

* Georgia

HB 488,Laws 2005, clarifies the commissioner's authority for adjustments which may be made when the taxpayer's activities directly or indirectly distort true net income or the taxpayer engages in improper activities, and provides that the commissioner will by regulation provide when to apply this section.

In a separate development, a Superior Court held (85) that even if the state's general three-year SOL for filing refund claims had lapsed, the taxpayer could generate a state tax refund because it had filed an amended Federal return, and the statute requiring taxpayers to file an amended Georgia return within 180 days of filing an amended Federal return applies equally to Federal income tax adjustments initiated by the taxpayer or the IRS.

* Illinois

SB 3196, Laws 2005, eliminates the state's 20% underreporting penalty enacted in 2003, but applies stricter standards to returns filed after 2004 that are subject to the late-payment penalty.

* Massachusetts

HB 4169, Laws 2005, includes new penalties for taxpayers and preparers that fail to disclose an "inconsistent position" when the Massachusetts income tax return reflects a departure from the application of a similar law in the filing or another state's tax return and the resulting Massachusetts tax liability is lower than a consistent interpretation. In addition, a new 20% underpayment penalty is imposed on taxpayers who substantially understate their tax liability, or who underpay their taxes due to negligence or disregard of Massachusetts law. This penalty cannot be imposed on any portion of an underpayment if it is shown that there was reasonable cause and that the taxpayer acted in good faith. The commissioner is empowered to list, by regulation, abusive transactions or tax strategies that would be subject to these new penalties.

* Minnesota

The Minnesota Supreme Court held that an order assessing tax that is not in conformity with the requirements of the Taxpayers' Bill of Rights (because it did not set forth the refund claim limitation period and the methods for obtaining a refund) does not trigger the one-year period for filing a refund claim. (86)

* New Hampshire

HB 2, Laws 2005, authorizes the DOR to disallow "sham transactions" between members of a controlled group and extends the applicable SOL on such transactions. (87) Sham transactions are defined to include a transaction or series of transactions without economic substance and when "there is no business purpose or expectation of profit other than obtaining tax benefits."

* North Dakota

SB 2132, Laws 2005, requires that any refunds or credits for taxes paid based on unconstitutionality claims must be requested within 180 days of the original return due date or the tax payment, whichever occurs first.

Passthrough Entities

Withholding on Nonresident Owners

* Arkansas

For tax years beginning after 2005, SB 509, Laws 2005, requires passthrough entities (other than investment partnerships) to withhold income tax on nonresident individual and corporate owners, unless a composite return is filed or the nonresident signs an agreement to timely file Arkansas returns.

* Colorado

Under HB 1251, Laws 2005, effective for tax years beginning in 2006, a publicly waded partnership is exempt from the requirement either to file with the DOR an agreement by each nonresident to pay the income tax on that partner's share of income attributable to the state or to pay the income tax on behalf of each nonresident partner, and also not to file a composite income tax return or make composite tax payments on behalf of its nonresident partners.

* Maryland

HB 147, Laws 2005, requires most passthrough entities to pay tax on behalf of their nonresident shareholders, partners or members at an increased rate of 6% (rather than the prior 4.75%) top marginal individual tax rate, or the 7% corporate tax rate, as applicable. The new law also extends this tax to include not only nonresident individuals, but "nonresident entities."

* Minnesota

For tax years beginning after 2005, HF 138, Laws 2005, requires partnerships and S corporations to make quarterly (rather than annual) payments of the income tax withheld on nonresident owners. HF 2228, Laws 2005, exempts publicly traded partnerships from the nonresident withholding provisions.

* North Dakota

SB 2045, Laws 2005, requires passthrough entities to withhold income tax on distributions to certain nonresident members at the highest individual tax rate and permits such entities to file a composite income tax return on behalf of electing nonresident members. Withholding is not required for publicly traded partnerships and for nonresident individual owners that elect to be included in the composite return.

* Oregon

Effective Jan. 1, 2006, HB 2452, Laws 2005, requires passthrough entities to withhold income tax on distributions to nonresident members at the highest individual tax rate or applicable statutory corporate tax rate if such members do not elect to file as part of a composite tax return, and authorizes passthrough entities to file composite income tax returns on behalf of electing nonresident individuals, corporations or masts.

* Wisconsin

For tax years beginning after 2004, AB 100, Laws 2005, requires passthrough entities to withhold income tax on nonresident owners at the highest individual or corporate tax rate.


* Connecticut

The Connecticut Supreme Court held that corporate partners were not entitled to claim the corporate income tax credit for personal property taxes paid on electronic data processing equipment by their partnership, because partnerships are ineligible for this credit under statute and thus cannot pass it through as a conduit to its corporate partners. (88)

* Idaho

HB 25, Laws 2005, provides that nonresident individuals, trusts and estates must include as Idaho-sourced income any gains or losses realized from the sale or other disposition of a partnership interest or S stock, to the extent reflected by the passthrough entity's Idaho apportionment factor in the tax year immediately preceding the sale year.

* Kentucky

HB 272, Laws 2005, imposes corporate tax on limited liability entities (including limited liability companies, limited liability partnerships, real estate investment trusts, regulated investment companies, real estate mortgage investment conduits and financial asset securitization investment trusts) by including such entities in the definition of "corporation"

* Louisiana

HB 130, Laws 2005, provides that effective for tax periods beginning after 2004, unincorporated organizations that elect out of partnership treatment for Federal income tax purposes are considered to have elected out of partnership treatment for Louisiana corporation income tax purposes.

* Maine

Effective July 1, 2005, LD 468, Laws 2005, requires the gain/loss on the sale of a partnership interest to be sourced to Maine based on a ratio of dividing the original cost of partnership tangible property located in Maine by the everywhere cost, as determined at the time of the sale. If the partnership's asset value consists mostly of intangible property, the gain/loss is sourced using the sales factor of the partnership for its first full tax period immediately preceding the tax period during which it was sold, unless the partnership is an investment partnership.

* Nebraska

Effective July 16, 2005, a corporate partner's sales factor depends on whether the corPoration and partnership are unitary. If unitary, the corporation's sales factor includes its share of the partnership's sales factor; if not unitary, the corporation's sales factor includes its distributive share of the partnership income. (89)

* New York City

For tax years beginning after 2004, SB 5568, Laws 2005, amended New York City's administrative code to more closely conform the city's unincorporated business tax to its general corporation tax by making the three-factor formula allocation method the preferred allocation method, generally allowing use of the old "books and records" method only to certain existing partnerships for an additional seven-year period. The law also conforms the city's unincorporated business tax to the general corporation tax for sourcing receipts from personal services and the inclusion of rented tangible personal property in the property factor.

* Virginia

The Department of Taxation explained that a corporation is not required to file an income tax return merely because it owns an interest in an investment passthrough entity. (90) Additionally, corporations required to file Virginia tax returns and that are limited partners in such entities generally would not flow up their pro-rata share of partnership factors in computing their own Virginia apportionment factors.


* Arkansas

SB 38, Laws 2005 (Act 63), repealed the 3% income tax surcharge that was scheduled to expire.

* Connecticut

H 6940, Laws 2005, imposes a 20% corporation tax surcharge for income year 2006 and a 15% surcharge for the 2007 income year. The surcharge does not apply to the $250 minimum tax.

* Delaware

HB 264, Laws 2005, equalizes the income tax rate for all corporations and defined Headquarters Management Corporations (HMQs) to a uniform 8.7% rate, permits HMQs that are members of an affiliated group to file consolidated income tax returns and clarifies that certain job creation and economic development investment incentives are credits against the tax owed.

* Kentucky

Under FIB 272, Laws 2005, the corporation license tax was repealed. The corporate rate reduced from 8.25% to 7% in 2005 and 2006, and to 6% in later years. An alternative minimum tax, equal to the lesser of 9.5 cents per $100 of Kentucky gross receipts or 75 cents per $100 of Kentucky gross profits, is imposed.

* Maine

LD 1691, Laws 2005, increases the tax imposed on some multistate corporations by requiring that the unitary group first determine the Maine tax on 100% of its income and then apportioning the tax to Maine, and cancelled Maine's membership in the Multistate Tax Commission.

* Minnesota

The Minnesota Supreme Court held that a foreign sales corporation (FSC) can qualify as a foreign operating corporation (FOC) if it meets the statutory requirements, and that dividends "deemed paid" by FSCs operating as FOCs are allowed as a state dividends-received deduction (DRD) to the recipient (no DRD) is allowed for dividends "actually paid" by FSCs). (91) The court also sustained that the taxpayer was allowed to subtract 80% of fees that the FOC paid to it for services it provided.

In response to this decision, HF 138/SF 106, 2005 Special Session, modified the law to provide that effective for tax years beginning after 2004 to qualify as a foreign operating corporation: (1) at least 80% of the entity's property and payroll of the entity must be outside the U.S.; (2) the entity must have a minimum of $1 million in foreign payroll and $2 million in foreign property; (3) contracted foreign work can substitute for payroll requirements in certain situations; and (4) payroll and property of unitary partnerships can be included in computations.

* New York

For tax years beginning after 2004, the State Budget for Fiscal Year 2006 (A 6845/S 3671, Laws 2005) increased the maximum amount of the alternative capital tax base from $350,000 to $1 million for nonmanufacturing taxpayers.

* North Dakota

HB 1108, Laws 2005, reduced the top corporation income tax rate from 7% to 6.5%, effective for tax years beginning after 2006.

* Ohio

Ohio's biennial budget bill (Am. Sub. HB No. 66) included a comprehensive restructuring of Ohio's principal tax programs. Among the key tax features include: (1) a new gross receipts tax (Commercial Activity Tax (CAT)) imposed at a 0.26% rate incrementally phased in beginning July 1, 2005, with the 0.26% rate fully applicable on April 1,2009; and (2) the incremental phaseout of the corporate franchise tax for corporations subject to the CAT beginning with the 2006 tax year until fully eliminated for the 2010 tax year. The CAT is imposed on any individual or entity regardless of organizational form including, but not limited to, corporations, passthrough entities and entities that are disregarded for Federal income tax purposes. Excluded from application of CAT are persons with $150,000 or less of taxable gross receipts, certain insurance companies, many financial institutions, as well as most of their affiliates, and nonprofits. The statute describes the CAT as not a transactional tax and specifies that it is not subject to P.L. 86-272. The law also declares that the tax is not limited to persons with substantial nexus, even though substantial nexus is broadly defined elsewhere in the law to include any entity that can be required to remit the tax under the U.S. Constitution, is authorized to do business in Ohio, or owns or uses capital in Ohio. The law further provides ,bright line presence" criteria for establishing "substantial nexus."

For more information about this article, contact Ms. Boucher at

(58) AZ Stat., Ch. 11, 43-1139, as amended by Ch. 289 (HB 2139, Laws 2005).

(59) HF 138/SF 106, 2005 Special Session.

(60) State Budget for Fiscal Year 2006 (A 6845/S 3671, Laws 2005).

(61) MDC Holdings, Inc. v. AZ Dep't of Rev. (DOR), AZ Tax App. Bd., Dkt. No. 1929-04-1 (5/24/05).

(62) CA FTB Legal Ruling No. 2005-1 (3/21/05).

(63) The Limited Stores, Inc., et al. v. CA FTB, CA Ct. App., 1st Dist., No. A102915 (7/28/05).

(64) Microsoft Corp. v. CA FTB, CA Ct. App., 1st Dist., No. A105312 (2/28/05).

(65) IN DOR Ltr. of Finding No. 03-0154 (1/1/05).

(66) Miller Brewing Co. v. IN Dep't of State Rev., 831 NE2d 859 (IN Tax Ct., 2005), department motion to correct error denied 836 NE2d 498 (IN Tax Ct., 2005).

(67) Boston Profl Hockey Ass'n v. MA Comm'r of Rev., 443 Mass 276 (2005).

(68) Tech-Etch, Inc. v. MA Comm'r of Rev., MA ATB, Dkt. No. C260139 (6/3/05).

(69) Fluor Enterprises, Inc. v. MI Dep't of Treasury, 697 NW2d 539 (MI Ct. App., 2005).

(70) MI Dep't of Treasury Internal Policy Directive No. 2005-1 (5/27/05).

(71) Reg., NM Tax & Rev. Dep't (10/31/05).

(72) Amended Reg. 17 NAC 05C.1002, NC DOR (3/1/05).

(73) New Rule OAR 150-314.670-(A), ORDOR (eff. 12/31/04).

(74) UPS Worldwide Forwarding, Inc. v. Comm'th, PA Sup. Ct., Dkt. Nos. 1-4 MAP 2005 (12/30/05).

(75) Home Interiors & Gifts, Inc. v. Strayhom, 175 SW3d 856 (TX App., Austin 2005).

(76) Appeal of Boston Scientific Corp., CA SBE, Case No. 244315 (2/8/05).

(77) ID State Tax Comm. Dec. No. 18612 (9/28/05).

(78) The Dow Chem. Co. v. IL DOR, 832 NE2d 284 (IL App. Ct., 2005).

(79) Kohl's Dep't Stores, Inc. v. IN DOR, 822 NE2d 297 (IN Tax Ct., 2005).

(80) Kidde America, Inc. et al. v. MO DOR, MO Administrative Hearing Comm., No. 05-0083 RI (9/22/05).

(81) Sherwin-Williams Co. v. Tax Appeals Tribunal, 4 NY3d 709 (2005).

(82) In the Matter of Disney Enterprises, Inc. et al., NY Tax App. Trib., DTA No. 818378 (10/13/05).

(83) Miami Corp. v. DOR, State of OR, OR Tax Ct., No. TC-MD 021295C (2/17/05).

(84) Reg. Sec. 810-14-1-.06.

(85) McKesson Information Solutions LLC v. Comm., GA Sup'r Ct., Fulton County, Civ. Act. No. 2004CV8565 (7/13/05).

(86) MBNA America Bank, N.A. v. MN Comm' r of Rev., 694 NW2d 778 (MN 2005).

(87) See also, NH DOR Technical Information Release No. 2005-001 (8/24/05).

(88) Bell Atlantic Nynex Mobile, Inc. v. CT Comm'r of Rev. Servs., 273 Conn. 240 (2005).

(89) NB Keg. Sec. 24-056.

(90) VA Tax Bulletin 05-6 (5/6/05).

(91) Hutchinson Technology, Inc. v. MN Comm'r of Rev., 698 NW2d 1 (MN 2005).

Karen J. Boucheri CPA


Deloitte Tax LLP

Milwaukee, WI

Shona Ponda, J.D.


Deloitte Tax LLP

Atlanta, GA
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Title Annotation:part 2
Author:Ponda, Shona
Publication:The Tax Adviser
Date:Apr 1, 2006
Previous Article:Treatment of community income for spouses living apart.
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