Tax News

CCH (cch.taxgroup.com) reports:

An out-of-state financial services processing company had nexus with Florida for corporate income tax purposes even though its only contact with the state was through unrelated authorized vendors. The taxpayer did not maintain real or tangible personal property or employ personnel or agents in Florida. However, the taxpayer was licensed, as required, with the Office of Financial Regulation of the Florida Department of Financial Services as a payment instrument seller and, under this license, the taxpayer had registered locations (authorized vendors) in the state. For nexus purposes, "doing business "in Florida means actively engaging in any transaction for the purpose of financial gain. Following decisions from other state supreme courts, and in light of the fact that the U.S. Supreme Court has declined to review the issue, the Florida Department of Revenue's position is that physical presence is not required to impose the state's corporate income tax. The taxpayer's unrelated authorized vendors were licensed agents of the taxpayer who operated on the taxpayer's behalf within Florida. The activities of these vendors were sufficient to create corporate income tax nexus, because without them, the taxpayer could not operate its business in Florida.
Technical Assistance Advisement, No. 07C1-007 , Florida Department of Revenue, October 17, 2007, ¶205-125
Other References:
Explanations at ¶10-075