Apr 09, 2018
From KPMG TaxWatch
Under current Arizona law, sales of other than tangible personal property are sourced using an income-producing activity test. However, multistate service providers can elect to use a market-based sourcing approach for service receipts. A “multistate service provider” is generally a taxpayer that derives more than 85 percent of its sales from services provided to purchasers that receive the benefit of the service outside of Arizona. Senate Bill 1405, which was signed into law on March 29, 2018, revises the definition of “multistate service provider” to mean a taxpayer that derives more than 85 percent of its sales from services or sales from intangibles provided to purchasers who receive the benefit of the service Arizona. “Sales from intangibles” means sales derived from credit and charge card receivables, including fees, merchant discounts, interchanges, interest and related revenue. This change is effective for tax years beginning from and after December 31, 2019. Please stay tuned to TWIST for more legislative updates.
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The following information is not intended to be "written advice concerning one or more federal tax matters" subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230.
The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.