Is it time for a road trip? Be sure to consider the tax impact of crossing state lines
Abstract: Conducting business in multiple states may open new markets and allow companies to better leverage their distinctive strengths. But doing so can also create unexpected tax liability. Another state can apply its income, franchise, or sales and use tax to a business if that business establishes a sufficient connection, or “nexus,” with that state — and many states require only a minimal presence to establish nexus. This article discusses the factors that establish nexus, and explains why multistate taxation isn’t necessarily a bad thing.