Multistate taxation — Give your business a nexus checkup

Description

Abstract: Whether a business is subject to another state’s income, franchise, sales and use, or other taxes depends on whether it has a substantial connection — or “nexus” — with that state. But the rules regarding nexus vary from tax to tax, state to state and even locality to locality, so understanding and complying with multistate tax obligations can be a challenge. This article discusses what might trigger nexus and looks at legislative attempts to make multistate tax compliance easier. In the meantime, to avoid unexpected tax liabilities, it may be beneficial for businesses to work with their tax advisors to conduct periodic nexus checkups.