In response to numerous inquiries for copies of our Transcript of ruling and argument following our August 22, 2013 alert, of the New Jersey Tax Court’s bench ruling that the Division of Taxation may not apply dual nexus standards for Throwout purposes. The Tax Court placed “its findings of fact and conclusions of law on the record in the presence of counsel in open court on August 9, 2013.” The Tax Court’s findings of fact and conclusions of law are on pages 65 through 76 of the Transcript.
In 2011, the New Jersey Supreme Court narrowed the Throwout rule to find it Constitutional on its face in Whirlpool Properties, Inc. v. Director, Division of Taxation. In so doing, it held that Throwout does not apply when another state may Constitutionally impose a tax on the taxpayer – regardless of the tax decisions by the other state. The Tax Court applied Whirlpool Properties and held that, because New Jersey successfully asserted an economic nexus standard for Corporation Business Tax Constitutional subjectivity purposes, in applying Throwout that same standard must also apply for other states’ subjectivity.
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