Nexus After Wayfair-Multi-State Sales

Description

Significant changes in how businesses operate and consumers shop has caused a desperate search for revenue by most states. Internet commerce defies taxation under traditional concepts of nexus and situs. States have been expanding their view of nexus, especially for sales taxes. On June 21, 2018, the U.S. Supreme Court decided in Wayfair that physical presence is not required for sales tax nexus by overruling the Quill and National Bellas Hess decisions. This comes on the heels of Colorado's victory in the 10th Circuit
to require interstate businesses who did not collect sales taxes to instead report to the state "to assist the state in collecting use tax from in-state purchasers." These decisions, plus recent trends in state legislation and merging nexus standards for taxing sales and income, are blurring the landscape for many businesses. This change in fundamentals from a "presence-based" tax system to an "economic opportunity-based" tax structure requires CPAs to understand state and local tax issues. Businesses need to consider restructuring themselves to minimize the multi-state tax burden. This program explains and illustrates how to avoid becoming subject to excessive state taxation-and who knows, Congress might even pass legislation that has been proposed for almost 30 years!

Highlights

 Nexus, situs, and internet commerce
 Relationship to federal taxation
 Tax treatment of mobile and remote employees
 Common differences of federal versus state
 Three factor formula, common variations, and emerging single-factor apportionment
 Gross receipts and other unique but expanding tax systems
 Tax issues involving intellectual property sales across state lines
 Taxation of internet-based transactions
 Sales and use taxes, including an update on changes in sales tax nexus
 Information reporting requirements for out-of-state sales that have obtained court approval
 Multi-state Tax Commission initiatives
 Filing rules and audit procedures
 Current developments in multi-state taxation

Objectives

Participants will be able to:
 Understand key terms and concepts in multi-state tax planning and compliance
 Recognize changes in nexus standards for sales and income taxes
 Anticipate trends in changing tax standards in order to adjust business practices
 Compute state income under a variety of taxing systems
 Recognize the need for different planning approaches for different taxing systems
 Properly apportion income when state tax systems are not the same-unitary versus single entity, "Commercial Nexus," variants of three factor formula, and integrated business versus investment
 Properly account for property, payroll, and sales
 Restructure entities to reduce taxes
 Comply with sales, and use tax rules without overpaying tax
 Work with states' administrative rules, audit procedures, and statutes of limitation

Designed For

CPAs, accountants, and financial professionals whose clients or employers do business or have employees in more than one state. The more states, the more this program will be beneficial.