Multistate Income Sourcing: Performance Based vs. Market Based Sourcing
Author: Elizabeth Pascal, Debra Silverman Herman, Hodgson Russ LLP, Mario T Caito
| CPE Credit: |
2 hours for CPAs |
States use a variety of methods to source the income or profits from multijurisdictional businesses. This course from the corporate tax experts at Hodgson Russ LLP will discuss sourcing issues and methods, including cost of performance and market-based sourcing. Recent developments, including new market-based sourcing regulations and key cases involving what constitutes an income-producing activity, will be reviewed to help companies and professionals properly characterize business activities for purposes of apportionment, understand complex hierarchal rules for sourcing receipts from digital products or services, as well as when to consider a request for alternative apportionment.
Publication Date: December 2024
Topics Covered
- Income Tax Nexus
- The Basics of Apportionment
- Apportionment Formulas
- Performance Based (COP) v. Market-Based Sourcing
- Recent Key COP and Market-Based Sourcing Cases
- Market-Based Sourcing Regulations Update
- Industry-Specific Apportionment Formulas
- Alternative Apportionment
Learning Objectives
- Identify how to characterize business activities for purposes of apportionment
- Identify how to navigate the nuances of cost of performance and market-based sourcing
- Identify alternative apportionment considerations
- Recognize key audit issues and identify steps to address such issues at the tax return filing stage
- Identify the state that uses a different apportionment regime depending on entity type
Level
Overview
Instructional Method
Self-Study
NASBA Field of Study
Taxes (2 hours)
Program Prerequisites
None
Advance Preparation
None
