Public Law 86-272 trumps the physical presence test and the economic nexus test.
If a corporation or LLC is organized in a state, or if these entities are organized under the laws of a state then those entities are subject to the laws of that state including its tax laws. If they are not organized under the laws of a state but receives money from that state or from residents of that state, or the business has a physical presence in the state, then income tax nexus exists. There are also exceptions so it’s necessary to go to the regulations of each state and find out the exceptions for physical presence nexus. Download this video for more information on physical presence nexus as well as agency and economic presence. Listen to details regarding Public Law 86-272 which prohibits some state income taxation
Morris N. Robinson, Esq., CPA, LL.M.
M. Robinson & Company, P.C.
- Founder of M. Robinson & Company, P.C., Tax Law Specialists, a tax firm located in Boston's financial district since 2005
- Experienced tax lawyer and certified public accountant with more than 30 years of tax law practice
- Focuses his practice on federal, international, and multistate taxation of businesses and individuals; this includes tax planning for the sale of businesses and resolving highly complex tax issues under the Offshore Voluntary Disclosure Program
- Frequent speaker in front of local and national audiences on topics ranging from family-oriented tax planning to the tax and legal issues facing retirees living overseas
- Written numerous publications including “State Voluntary Disclosure Programs: An Overview,” Tax Analysts, State Tax Notes (January 18, 2016) and “Use State Voluntary Disclosure When Complying with Expanded Nexus,” Tax Analysts, State Tax Notes (February 29, 2016)
- Member of the American Academy of Attorney-Certified Public Accountants (president, New England Chapter), Boston Bar Association (Federal Tax Committee), and Massachusetts Society of Certified Public Accountants (State and Federal Tax Committees)
- J.D. and LL.M degrees, Boston University School of Law; B.S. degree, Babson College
- Can be contacted at 617-428-0055, [email protected], on LinkedIn®: https://www.linkedin.com/in/morrisrobinson, or on Twitter®: @MRobinsonCo
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