Due to the COVID-19 pandemic, millions of people have been telecommuting from their home state or from another location where they have decided to shelter in place. Allowing employees to telecommute from states in which they do not normally work can create a host of issues for multistate companies, but the two biggest tax issues relate to nexus and income apportionment. Will the presence of an employee working from home create taxable nexus for the employer in that state? How should the business apportion and allocate income between its home state and the state in which the remote employee provides his or her services? Is it possible that states could have contradictory rules, creating a double tax situations? (Spoiler alert: yes!).
Who Should Attend
All CPAs, enrolled agents, tax return preparers, tax attorneys, CFOs, in-house tax experts, and other practitioners responsible for preparing multistate tax returns or advising on multistate income apportionment and allocation.
Topics Covered
- Sales and Use Tax Nexus
- Direct Income Tax Nexus
- COVID-19 Nexus Exceptions
- Apportionment
- Market-Based Sourcing of Receipts
- Choice of Entity
Learning Objectives
- Identify multistate nexus thresholds
- Identify COVID-19 related exceptions to traditional nexus rules
- Recognize income apportionment rules for individuals and various business entities
- Identify entity-specific advantages related to tax nexus and income apportionment
- Describe the nationwide shift from cost of performance to market-based sourcing of receipts
Level
Basic
Instructional Method
Group: Internet-based
NASBA Field of Study
Taxes (2 hours)
Program Prerequisites
None
Advance Preparation
None
Instructors
Christopher L. Doyle
Chris is the firm's State & Local Tax (SALT) Practice Leader. He focuses primarily on New York State and New York City business taxes, including corporate income tax, unincorporated business tax, flow-through entity income taxation and sales and use taxes.
Chris provides counsel for tax-wise transaction structuring as well as tax controversy representation at every level, from audit representation to representation before New York's Court of Appeals. He frequently represents taxpayers before New York State and New York City tax agencies and administrative hearing institutions.
Chris’ primary goal is to have the members of the SALT practice deliver timely, creative, practical and otherwise excellent service to its clients. He also helps the practice's partners envision and adopt amendments to the practice's strategic plan, a plan that is rolled out to SALT’s internal stakeholders (both lawyers and non-lawyers) for implementation.
The Hodgson Russ SALT Practice is constantly increasing its geographic footprint as client’s require progressively less of our attorneys’ face-to-face time and revenue-starved states press progressively harder both in the enactment of constitutionally-questionable tax laws and in the over-zealous interpretation of those laws on audit.
K. Craig Reilly
Craig is a partner in the firm’s State & Local Tax Practice. Craig counsels businesses and individuals in a range of state and local tax issues, with a focus on New York State, New York City, New Jersey, and multistate tax issues.
Prior to joining Hodgson Russ, Craig was a judicial intern for the Honorable Jane A. Resanti of the U.S. Court of International Trade and an investigative analyst at the New York County District Attorney's Office.
Craig advises clients on all aspects of state and local tax from planning and compliance to controversy and litigation. He represents clients in disputes with the New York State Department of Taxation and Finance, New York City Department of Finance, and New Jersey Division of Taxation and is experienced in handling sales tax, corporate franchise tax, personal income tax, and residency audits.
Craig works closely with remote retailers and cloud-based software vendors on a variety of multistate tax compliance issues, including filing requirements, sales and use tax collection obligations, income allocation and apportionment, tax registrations, and applications for voluntary disclosure and other amnesty programs.