Tax News

CCH (cch.taxgroup.com) reports:

The members of a taxpayer's affiliated group may elect to use the Missouri single-factor method of apportionment to determine the portion of the affiliated group's Missouri taxable income that is derived from sources within Missouri for Missouri corporate income tax purposes. Furthermore, in determining the affiliated group's Missouri apportionment percentage, the receipts from any intercompany transactions between the one group member domiciled in Missouri and the taxpayer-owned Missouri-domiciled single member limited liability company (LLC) that acts as an administrator for each member of the group are properly included as wholly within Missouri because those intercompany transactions are conducted completely within Missouri.
The receipts arising from transactions between the LLC and the out-of-state group members are properly treated as partly within and partly without Missouri. Because the brains of the LLC's operations are located within Missouri, lending Missouri effort to all of the LLC's business transactions, none of the receipts from any intercompany transactions involving the LLC would be classified as wholly without Missouri. Amounts paid to a Missouri organization by the state of Missouri for the benefit of Missouri beneficiaries and for the provision of services to those beneficiaries wholly within Missouri are included as sales transacted wholly within Missouri, while amounts paid to a non-Missouri organization by a state other than Missouri for the benefit of non-Missouri beneficiaries and for the provision of services to those beneficiaries wholly outside Missouri are included as sales transacted wholly without Missouri.
Letter Ruling No. LR4124, Missouri Department of Revenue, October 5, 2007, ¶202-797
Other References:
Explanations at ¶11-520