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Apr 8, 2010 · Worldwide unitary taxation came under assault in the 1980s and 1990s. In recent years, unitary combined reporting has seen a resurgence, as Vermont (2006), New York (2007), Michigan and Texas (2008), and Massachusetts, West Virginia, and Wisconsin (2009) have jumped on the bandwagon. Although "worldwide unitary combined reporting" was upheld ...
Apr 14, 2015 · The unitary business principle originated in the United States in the 19th century with state property taxes and transcontinental railroad and express companies. The issue in those early cases was ...
Mar 1, 2001 · In contrast, changes in unitary state tax rates can result in significant resource changes in both the unitary state and in other states. The finding that tax rate cuts are ineffective in nonunitary states implies that these states may be more successful in attracting investment by changes affecting apportionment factors (tax credits for new ...
Define Unitary Tax. means a state Income Tax that reflects the combined and/or consolidated tax reporting (either on a domestic or worldwide basis) of a corporation and its Affiliates and that is imposed by that state either (i) on its apportioned and/or allocable share of the net income of a taxpayer and its United States Affiliates that are ...
- Unitary Group Opportunities
- Functional Integration
- Centralization of Management
- Economies of Scale
- Jurisdictional Inconsistency
- Sources
While combined reporting often limits potential opportunities for impacted businesses through the imposition of mandatory rules under separate reporting regimes, several opportunities may be available, including defining the unitary group subject to combination, as well as apportionment planning in the proper calculation of the sales factor. In mos...
The functional integration test looks to shared functions and refers to transfers between, or pooling among, business entities that significantly affect the operation of the business activities.5Generally, functional integration includes, but is not limited to, transfers or pooling with respect to the business’s products or services, technical info...
The centralized management test focuses on not the ability to control but the actual amount of common control exercised between business segments. Centralization of management exists when directors, officers, and/or other management employees jointly participate in the management decisions that affect the respective business activities and that may...
The economies of scale test focuses on whether there is any income earned as a result of shared functions, activities, or operations. Economies of scale refer to a relation among and between business activities resulting in a significant decrease in the average per-unit cost of operational or administrative functions due to the increase in operatio...
Currently, approximately 30 jurisdictions mandate unitary combined reporting for general corporations that are commonly owned or controlled. However, notwithstanding the constitutional tests discussed above, these states adopt varying statutory definitions of “unitary” for purposes of combined reporting. Even in cases where the definitions in diffe...
Butler Brothers v. McColgan, 315 U.S. 501 (1942); See also 17 Cal. 2d 664.Edison California Stores v. McColgan, 183 P.2d 16 (1947).Mobil Oil Corp. v. Commissioner of Taxes of Vermont, 445 U.S. 425 (1980).Ibid.Jul 2, 2019 · Unitary combined reporting, where a state treats all affiliated companies as part of a single group for tax purposes, adds complexity in throwback, and combined reporting states must adopt rules which determine whether they can capture “nowhere income” associated with a particular company if another member of its unitary group is taxable in ...
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The unitary business method of tax accounting combines the activities of a unitary group of businesses and apportions a calculated amount of those activities to the state to be taxed. The theory behind the unitary method of income allocation is that "it is unrealistic geographi-
