combined reporting

Subscribe to combined reporting via RSS

The New York State Governor and Legislature recently enacted the 2014-2015 New York State Budget, Senate Bill 6359-D and Assembly Bill 8559-D (Budget), which results in the most significant overhaul of New York’s franchise tax on corporations in decades. In this edition of New York Tax Reform Made Easy, we will address how the Budget implements unitary combined reporting and expands the use of economic presence nexus.
Continue Reading New York Tax Reform Made Easy: Unitary Combined Reporting and Nexus

The Sutherland SALT Team will release commentary on the revamped New York State corporate tax system that was reformed as part of the recently enacted Budget Legislation (“Budget”). By way of background, Governor Andrew Cuomo signed into law the tax provisions of the Budget on March 31. The changes will affect nearly every New York…

By Ted Friedman and Prentiss Willson

The Indiana Department of Revenue determined that affiliated entities of an out-of-state manufacturing corporation were not unitary. The corporation conducted marketing operations as one business segment and production operations as a second business segment. The corporation included its marketing entities in its Indiana consolidated return. On audit, Department staff…

By Madison Barnett and Prenitss Willson

The Mississippi Supreme Court held that a casino operator was entitled to use tax credits—specifically, gambling license fee credits—earned by one combined group member to offset the entire combined group’s liability. Mississippi is generally a separate return state, but taxpayers may elect to file a post-apportionment, nexus-combined return. The…

By Madison Barnett and Timothy Gustafson

In the first appellate decision arising from a Texas Margin Tax audit, the Texas Court of Appeals ruled in favor of the taxpayer, holding that a combined group’s eligibility for the cost of goods sold (COGS) deduction is determined on a group-wide rather than a separate-entity basis. The Comptroller…

By Suzanne Palms and Andrew Appleby

The Arizona Court of Appeals held that Home Depot U.S.A., Inc. (Home Depot) was required to include in its combined Arizona income tax return the income of an out-of-state subsidiary that licensed the retailer’s trademarks. Relying on R.R. Donnelley & Sons Co. v. Arizona Dep’t of Rev., 229…

By Derek Takehara and Andrew Appleby

The Virginia Tax Commissioner determined that the Department of Taxation was permitted to make net operating loss deduction (NOLD) adjustments for taxable years outside the statute of limitations because the adjustments were necessary to determine the correct federal taxable income for the taxable years at issue. The taxpayer, an…

By Christopher Chang and Timothy Gustafson

The Massachusetts Department of Revenue issued a Letter Ruling stating that, for purposes of determining common control with regard to a combined report, the Department looks to actual voting control as opposed to voting power, which is the test for federal consolidated reporting. Under the Massachusetts combined reporting rules…

By Scott Booth and Andrew Appleby

Although states continue to challenge the validity of captive insurance companies, Wendy’s has notched several taxpayer victories. In a win involving Scioto Insurance Company (Scioto), Wendy’s captive insurance company, the Illinois Appellate Court held that Scioto constituted a bona fide insurance company that was properly excluded from Wendy’s combined…