Bill > H2549

This bill clarifies how to determine a corporation's sales income when calculating its corporate excise tax, specifically concerning the "throw out" rule. The "throw out" rule is a tax accounting principle used when a business operates in multiple states or jurisdictions. It essentially means that if a sale is not taxable in the state where the business is located, it can be "thrown out" of that state's calculation and potentially assigned to another state where it is taxable. This bill amends Chapter 63 of the General Laws, which deals with corporate excise taxes, by changing how sales that are not of tangible personal property (like services or intangible assets) are assigned to a foreign country for tax purposes. The changes are effective retroactively for tax years beginning on or after January 1, 2014, and will remain in effect for tax years beginning before January 1, 2018, with a further amendment taking effect for tax years beginning on or after January 1, 2018.