NEXUS: Update On Recent Developments For Fourth Quarter 2010
Mondaq Business Briefing › United States Law Articles in English (2011)
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NEXUS: Update On Recent Developments For Fourth Quarter 2010
We keep track of nexus developments on a regular basis—legislation, administrative interpretations, the passage of rules and regulations, and court cases. This issue of our newsletter updates important nexus developments during the fourth quarter of 2010. Organized by the kind of activity that tends to give out-of-state entities nexus-planning and litigation difficulties, the items covered include the following: several rulings on the scope of P.L. 86-272's protections, "fly-by nexus" in Illinois, two more decisions imposing income tax on an intangible holding company based on economic nexus alone, and a pair of cases that show how using third parties in the state always raises tricky nexus issues. This update also has some cases with good "practical" advice: A Michigan appellate court decision provides an important reminder to take care when responding to nexus questionnaires, and a Virginia ruling highlights the importance of apportionment as an equally effective way to limit state tax liabilities. Finally, web nexus remains on the cutting edge in the news, as a New York appellate court issues its long-awaited decision on its "web affiliate" statute.
DOING BUSINESS IN THE STATE NEW YORK Can you follow the trail? Passive ownership in a limited liability company that ultimately held an indirect 0.01 percent general partnership interest in an entity doing business in New York created nexus. Shell Gas Gathering Corp. #2, et. al. v. N.Y. Div. of Tax App., CCH ¶ 406-422 (N.Y. Div. Tax App., ALJ Unit June 11, 2009), aff'd, Nos. 821569 and 821570, CCH ¶ 406-993 (N.Y. Div. Tax App., Tax App. Tribunal Sept. 23, 2010). Taxpayers Shell Gas Gathering Corp. #2 and Shell Gas Pipeline Corp. #2 were...See the full content of this document
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