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Exam 24: Multistate Corporate Taxation

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Question 21

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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 -A garment purchased by an employee for wear at an office job.

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Question 22

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Nonbusiness income receives tax-exempt treatment under all state corporate income taxes.

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B) False

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Question 23

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In conducting multistate tax planning,the taxpayer should:

In the apportionment formula,most states assign more than a one-third weight to the ____________________ factor.

For sales/use tax purposes,nexus usually requires that:

José Corporation realized $900,000 taxable income from the sales of its products in States X and Z.José's activities in both states establish nexus for income tax purposes.José's sales,payroll,and property among the states include the following. ​ X utilizes an equally weighted three-factor apportionment formula.How much of José's taxable income is apportioned to X?

Match each of the following terms with the appropriate description, in the state income tax formula. Apply the UDITPA rules in your responses. a.Addition modification b.Subtraction modification c.No modification -State income tax expense.

Ting,a regional sales manager,works from her office in State W.Her region includes several states,as indicated in the sales report below.Determine how much of Ting's $300,000 compensation is assigned to the payroll factor of State W.

A unitary business applies a combined apportionment formula,including data from operations of all of the affiliates.

Match each of the following terms with the appropriate description, in the state income tax formula. Apply the UDITPA rules in your responses. a.Addition modification b.Subtraction modification c.No modification -Dividend income from P & G stock held.

Match each of the following terms with the appropriate description, in the state income tax formula. Apply the UDITPA rules in your responses. a.Addition modification b.Subtraction modification c.No modification -State-level NOL.

You are completing the State A income tax return for Quaint Company,LLC.Quaint operates in various states,showing the following results. In A,all interest is treated as apportionable income.A uses a sales-only apportionment factor.Compute Quaint's A taxable income. ​

Typically,a sales/use tax is applied to a retail sale of ____________________ property.

Under Public Law 86-272,a state is prohibited from taxing a business if the only connection with the state is the _____________________ of orders for sales of tangible personal property that are sent outside the state for approval or rejection.

Ramirez Corporation is subject to income tax only in State A.Ramirez generated the following income and deductions. ​ Federal taxable income is the starting point in computing A taxable income.State income taxes are not deductible for A tax purposes.Ramirez's A taxable income is:

Match each of the following terms with the appropriate description, in the state income tax formula. Apply the UDITPA rules in your responses. a.Addition modification b.Subtraction modification c.No modification -Federal general business credit.

Hendricks Corporation sells widgets in two states.State A levies a 9% effective tax rate,and State B levies a 3% rate.A and B have adopted sales-factor-only apportionment formulas.To reduce overall multistate income tax liabilities,Hendricks should:

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

A(n) ____________________ business operates in concert with its affiliated companies.As a result,the affiliates' data are included in the parent's apportionment computations.

List at least five items that are included in the payroll factor of a typical state.Consider all forms of compensation that an employee might receive.Apply the general UDITPA rules.