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Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Corporate Tax

Date & Time
  • event Date

    Thursday, June 20, 2024

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    110 minutes

Credit Information

  • BARBRI is a NASBA CPE sponsor and this 110-minute webinar is accredited for 2.0 CPE credits.

$247.00
CPE
ALL

This course will explain nexus as outlined in PL 86-272, the sometimes conflicting nexus regulations established by individual states, and how to reconcile the two for the benefit of the taxpayer.

Faculty

Stacey L. Roberts
State and Local Tax Director
TaxOps

Ms. Roberts has been making state and local tax (SALT) less taxing for thousands of businesses over the last 25 years. As a director of the SALTovation team at TaxOps, she guides dynamic businesses through compliance and strategic planning focused on minimizing risk and strengthening tax positions. Ms. Roberts honed her specialty at Andersen Worldwide/Andersen LLP, KPMG and Deloitte before moving in-house with a Fortune 500 company to administer state and local tax. She has also led the national SALT practice at a regional firm. Ms. Roberts is a member of the Colorado Legislative Task Force Concerning Tax Policy and a frequent speaker, instructor and author on SALT issues for industry and professional organizations.

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Meredith Smith
Partner
TaxOps

Ms. Smith expertly weaves real-life examples into why business taxpayers, tax professionals, and tax providers should care about complex state and local tax (SALT) issues. This knowledge comes from expertly navigating the web of tax laws governing SALT issues for nearly 20 years. From working with clients inside their business, she knows the questions, issues and strategies for resolution that keep businesses on the tax compliance track. Ms. Smith combines technical knowledge and in-depth industry understanding in performing nexus studies, identifying areas of risk, and designing sustainable planning opportunities for achieving tax-specific business goals. Her practice covers state income tax, property tax, sales and use tax, and business incentives and credits. Prior to TaxOps, Ms. Smith was a member of the SALT practice at KPMG, serving large, multi-jurisdictional corporations and multi-tier partnerships across industries. She is a frequent speaker and the host of the SALTovation podcast, a podcast series featuring leading voices in states and local tax. Listen in on your favorite channel: https://saltovation.captivate.fm/listen. 

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Description

PL 86-272 is still alive and well; for sellers of tangible personal property post-Wayfair, more so than ever. But the Multistate Tax Commission (MTC) and the state of New Jersey have adopted controversial expanded interpretations to capture more internet-based activities.

Most states have or are in the process of adopting bright-line tests for sales tax nexus. The effects of Wayfair are seeping into the determination of state income tax nexus as well. In response, businesses are increasingly relying on the protection of PL 86-272 to circumvent the broadening reach of economic nexus and avoid out of state taxation.

PL 86-272 prohibits a state from taxing an out of state company's net income if its only activity is the solicitation of orders for the sale of tangible personal property within the state. Wayfair clearly states that physical presence is not necessary to establish nexus; having "substantial economic nexus" is sufficient. Additionally, SCOTUS did not hear challenges from companies required to remit tax in states that had implemented non-physical presence nexus standards before Wayfair.

Many states are taxing entities based on gross receipts or similar thresholds. Oregon joined as many as eight other states in taxing gross receipts with its Commercial Activity Tax effective in 2020. Reassessing tax liability impacts more than tax liability: Companies must update financial statement provisions, including current and deferred taxes, uncertain tax benefits, and related disclosures. SALT advisers and companies must reevaluate prior nexus determinations for both sales and state income tax liability.

Listen as our panel of experts explains which companies come under the umbrella of PL 86-272, which states are narrowly interpreting PL 86-272, and how to assess potential liability in states in this continually changing post-Wayfair environment.

Outline

  1. Nexus before Wayfair
  2. Falling under PL 86-272
  3. States' responses
  4. Reevaluating nexus for state sales and income tax
  5. Financial statement adjustments

Benefits

The panel will review these and other critical issues:

  • When can a business rely on PL 86-272?
  • What conflicts exist between PL 86-272 and economic nexus?
  • How are states interpreting PL 86-272 in light of Wayfair?
  • What steps should be taken when determining state nexus considering Wayfair and PL 86-272?

NASBA Details

Learning Objectives

After completing this course, you will be able to:

  • Examine controversial interpretations by MTC and the state of California
  • Determine when a business can rely on PL 86-272
  • Differentiate between nexus pre-Wayfair and post-Wayfair
  • Identify the conflicts between PL 86-272 and post-Wayfair economic nexus
  • Ascertain how various states are now interpreting PL 86-272 in light of Wayfair
  • Recognize other steps that states are taking to expand their tax base by taxing out of state businesses

  • Field of Study: Taxes
  • Level of Knowledge: Intermediate
  • Advance Preparation: None
  • Teaching Method: Seminar/Lecture
  • Delivery Method: Group-Internet (via computer)
  • Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
  • Prerequisite: Three years+ business or public firm experience preparing complex tax forms and schedules, supervising other preparers or accountants. Specific knowledge and understanding of pass-through taxation, including taxation of partnerships, S corporations and sole proprietorships, qualified business income, net operating losses and loss limitations; familiarity with net operating loss carry-backs, carry-forwards and carried interests.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.