Managing a Multistate Voluntary Disclosure Process in an Economic Nexus World

Author: K. Craig Reilly, Hodgson Russ LLP

CPE Credit:  2 hours for CPAs

Economic nexus now impacts both sales and use and income tax filing obligations around the country. As a result, many businesses have found themselves with unexpected past due liabilities as a result of surpassing economic nexus thresholds in unfamiliar jurisdictions. Thankfully, almost every state offers eligible taxpayers the option to address their liabilities through voluntary disclosure programs, which offer valuable benefits, such as limited lookbacks and automatic penalty abatement. Navigating a multistate voluntary disclosure process, however, requires significant planning and understanding of the rules in various jurisdictions.

During this two-hour CPE course, K. Craig Reilly, Esq., a highly regarded tax attorney from Hodgson Russ LLP, will outline the issues to consider before taking advantage of the benefits of a voluntary disclosure program. Mr. Reilly will offer practical solutions and help answer important voluntary disclosure-related questions. Are registered taxpayers eligible for voluntary disclosure? Should all applications be submitted anonymously? Which states participate in the Multistate Tax Commission (MTC) voluntary disclosure program? What is the standard lookback period? Is penalty abatement available when sales and use taxes have been collected but not remitted?

A working knowledge of how voluntary disclosure programs operate and how to manage the process is absolutely critical for tax practitioners, business owners, executives, and other professionals that deal with either general tax compliance or who are involved in transactional due diligence.

Publication Date: July 2022

Designed For
All CPAs, enrolled agents, tax return preparers, tax attorneys, corporate attorneys, and other practitioners who review or are responsible for preparing multistate tax returns for clients or advise on multistate tax issues will benefit from this insightful course.

Topics Covered

  • Overview of economic nexus rules
  • Voluntary Disclosure Programs
    • What is a voluntary disclosure?
    • Benefits
    • Eligibility
    • Multistate Tax Commission (MTC) Disclosure Program
  • Practical Considerations
    • Where to apply?
    • When to apply?
    • Timelines

Learning Objectives

  • Describe economic nexus rules
  • Identify how to manage a multistate voluntary disclosure process
  • Identify how to effectively weigh the costs and benefits of voluntary disclosure programs
  • Identify the number of states that are moving to an "economic nexus" approach
  • Recognize which states the case Telebright Corp., Inc. v. Director, Div. of Taxation find that one employee working from home in the state on a full-time basis was sufficient to subject an out-of-state corporation to CBT
  • Differentiate Public Laws passed to minimize the potential income tax burden of operating in numerous states
  • Identify the timeline periods you would practically disclose your identity and ensure data is available

Level
Basic

Instructional Method
Self-Study

NASBA Field of Study
Taxes (2 hours)

Program Prerequisites
None

Advance Preparation
None

Registration Options
Quantity
Fees
Regular Fee $62.00

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