News & Analysis as of

Multistate Tax Compact

Nutter McClennen & Fish LLP

Nutter Bank Report, February 2018

Small Bank Holding Company and Qualified Mortgage Regulatory Relief Bills Pass House The U.S. House of Representatives has passed two regulatory relief bills with bipartisan support, one of which would raise the ceiling on...more

Eversheds Sutherland (US) LLP

MTC Adopts Allocation and Apportionment Regulations

In a rare special meeting on February 24, 2017, the Multistate Tax Commission (MTC) adopted amendments to the MTC’s Model General Allocation and Apportionment Regulations (Model Regulations) that it has worked on since 2014....more

Ballard Spahr LLP

NJ-PA Income Tax Compact Survives

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New Jersey Governor Chris Christie gave Pennsylvania and New Jersey commuters who live in one state and work in the other a Thanksgiving present when he announced that he will not terminate the New Jersey-Pennsylvania income...more

Ballard Spahr LLP

End of NJ-PA Income Tax Compact Would Affect Tax Liability of Thousands of Commuters

Ballard Spahr LLP on

Pennsylvania and New Jersey commuters who live in one state and work in the other could face materially increased state tax withholding if a nearly 40-year-old tax reciprocity compact is terminated in January under an...more

Bradley Arant Boult Cummings LLP

Comments on Proposed New Alabama Corporate Income Tax Apportionment Rules

The Alabama Department of Revenue (ADOR) recently proposed numerous changes to its apportionment rules for corporate income taxpayers, with the stated intention of adopting “recommended amendments to the [Multistate Tax...more

Miller Canfield

Michigan Court of Appeal finds Multistate Tax Compact applicable to the former Michigan Single Business Tax (SBT) Act

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On February 25, 2016, the Michigan Court of Appeals released a decision for publication in the consolidated case of AK Steel Holding Corporation v. Department of Treasury, which upholds the ability of taxpayers to make the...more

Bradley Arant Boult Cummings LLP

Several Key Business Associations Announce 2016 Tax Legislative Agendas

In preparation for the 2016 regular session, which begins on February 2, several of Alabama's key trade and business organizations recently announced their tax legislative agendas. As reflected in these agendas, the 2016...more

Alston & Bird

State & Local Tax Advisory: Gillette Overturned: One Test, Two Decisions in California

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On Thursday, December 31, 2015, the Supreme Court of California issued its decision in Gillette Co. v. Franchise Tax Board. The court reversed the California Court of Appeal and held that the Multistate Tax Compact is not a...more

Eversheds Sutherland (US) LLP

California Supreme Court Holds Multistate Tax Compact is Not Binding

On December 31, 2015, the California Supreme Court closed the book on California’s Multistate Tax Compact election saga, unanimously holding that the Compact is not a binding contract among its members and the State was not...more

Morrison & Foerster LLP

California Supreme Court Unanimously Holds Against Gillette

Concluding that the California Legislature (1) is not bound by the Multistate Tax Compact (the “Compact”), (2) had unilateral authority to eliminate the apportionment formula election provision, and (3) clearly intended to do...more

McDermott Will & Emery

Focus on Tax Controversy - December 2015

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IRS Updates Administrative Appeals Process for Cases Docketed in Tax Court - In Notice 2015-72, the Internal Revenue Service (IRS) provided a proposed revenue procedure to update Rev. Proc. 87-24, 1987-1 C.B. 720, which...more

Eversheds Sutherland (US) LLP

Bueller? Bueller? MTC Still Calling on States to Join ALAS Program

The Multistate Tax Commission (MTC) advanced several items of interest during its annual fall meetings held in Charleston, South Carolina, this week, including the creation of a new committee to continue gathering support for...more

Morrison & Foerster LLP

Michigan Court of Appeals Upholds the Constitutionality of the State’s Retroactive Repeal of the Multistate Tax Compact

The Michigan Court of Appeals affirmed the Court of Claims’ decisions in cases that challenged the constitutionality of Michigan’s purported retroactive repeal of the Multistate Tax Compact effective January 1, 2008. The...more

Eversheds Sutherland (US) LLP

Court of Appeals Hears Michigan’s Compact Election Cases

The long saga of Michigan's Multistate Tax Compact election continued on Wednesday with oral argument before the Michigan Court of Appeals. A packed courtroom witnessed a 1.5 hour proceeding before an active three-judge...more

Eversheds Sutherland (US) LLP

MTC Nearing Completion of Model Sourcing Regulation for Services and Intangibles

The Multistate Tax Commission’s (MTC) Annual Conference and Committee Meetings are being held on July 27-30, 2015, in Spokane, Washington. On Tuesday, July 28, 2015, at approximately 1:00 pm PDT (exact time subject to...more

McDermott Will & Emery

How Far Back Can a Back Tax Go? Petition for Certiorari in Hambleton Asks Supreme Court to Right Unjust Retroactivity

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Retroactivity is an endemic problem in the state tax world. In this year alone, we have seen retroactive repeal of the Multistate Tax Compact (MTC) in Michigan, as well as significant retroactivity issues in New York, New...more

McDermott Will & Emery

Pennsylvania Unwraps Final Market-Sourcing Guidance

McDermott Will & Emery on

The Pennsylvania Department of Revenue (the Department) recently finalized its Information Notice on sourcing of services for purposes of determining the appropriate net income and capital franchise tax apportionment factors....more

McDermott Will & Emery

Did You Pay a Michigan Assessment After an MTC Audit? What the State’s Retroactive Compact Repeal May Mean

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On September 11, 2014, Michigan Governor Rick Snyder signed legislation (SB 156) retroactively repealing the Multistate Tax Compact (Compact, formerly codified at MCL § 205.581 et seq.) from the state statutes, effective...more

McDermott Will & Emery

How Will Michigan Courts Analyze a Legal Challenge to the Michigan Legislature’s Retroactive Repeal of the Multistate Tax Compact?

McDermott Will & Emery on

In recent days, the state tax world has focused on the State of Michigan’s retroactive repeal of the Multistate Tax Compact (Compact). Last week, the Michigan Legislature passed and Governor Snyder signed into law a bill...more

Eversheds Sutherland (US) LLP

Now You See It, Now You Don’t: MTC Election Disappears in Michigan?

On September 11, 2014, Michigan Governor Rick Snyder signed S.B. 156, which purports to repeal the state’s adoption of the Multistate Tax Compact (the Compact) retroactive to January 1, 2008. Mich. Pub. Acts 2014, No. 282...more

Eversheds Sutherland (US) LLP

Multistate Tax Commission Enacts Significant Amendments to Its Compact

On July 30, the Multistate Tax Commission (MTC) approved amendments to the Multistate Tax Compact’s (1) definition of nonbusiness income, (2) definition of “sales,” (3) factor-weighting, (4) alternative apportionment, and (5)...more

Bradley Arant Boult Cummings LLP

Possible Impact on Alabama Taxpayers: Michigan Supreme Court Rules that IBM Entitled to Use Multistate Tax Compact Election

In International Business Machines Corp. v. Department of Treasury, the Michigan Supreme Court ruled that IBM was entitled to apportion its business income for purposes of the Michigan Business Tax (“MBT”) using the...more

Miller Canfield

Out-of-State Companies Might Be Owed Tax Refunds Under Michigan’s Multistate Tax Compact Election Decision

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A Multistate Tax Compact (MTC) election is applicable to both the net income base and modified gross receipts base of the Michigan Business Tax (MBT), the Michigan Supreme Court ruled in International Business Machines v....more

Eversheds Sutherland (US) LLP

Michigan Supreme Court Upholds the Compact Election

On July 14, 2014, the Michigan Supreme Court in a splintered 3-1-3 decision found in favor of IBM’s election to apply the Multistate Tax Compact’s three-factor apportionment formula to the now-repealed Michigan Business Tax...more

Eversheds Sutherland (US) LLP

Legal Alert: MTC Speaks with Potential Transfer Pricing Vendors

On June 25, the Arm’s Length Adjustment Services Advisory Group (the Group) of the Multistate Tax Commission (MTC) met via teleconference to continue the process of developing a multistate arm’s length pricing adjustment...more

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