Business Activity Tax Simplification Act of 2011

Bill: 112-hr-1439
Sponsor: Rep. Goodlatte, Bob [R-VA-6]
Introduced: 2011-04-08 in the House
Policy area: Taxation
Subjects: State and local taxation

Summary:
action_date: 2011-04-08
text: 
Business Activity Tax Simplification Act of 2011 - Expands the federal prohibition against state taxation of interstate commerce to: (1) include taxation of out-of-state transactions involving all forms of property, including intangible personal property and services (currently, only sales of tangible personal property are protected); and (2) prohibit state taxation of an out-of-state entity unless such entity has a physical presence in the taxing state. Sets forth criteria for: (1) determining that a person has a physical presence in a state, and (2) the computation of the tax liability of affiliated businesses operating in a state.

action_date: 2011-10-21
text: 

(This measure has not been amended since it was introduced. The summary has been expanded because action occurred on the measure.)

 
Business Activity Tax Simplification Act of 2011 - Expands the prohibition against state taxation of interstate commerce to include: (1) taxation of out-of-state sales transactions involving all forms of property, including intangible personal property and services (currently, only sales of tangible personal property are protected); and (2) all other business activity taxes in addition to net income taxes. Exempts from state taxation persons who enter a state merely to furnish information to customers and affiliates, to cover news or other events, or to gather information in the state.
 
Sets forth jurisdictional standards for states in imposing, assessing, or collecting a net income tax or other business activity tax on interstate activities. Defines "physical presence in a state" as: (1) being an individual physically in a state or assigning one or more employees to be in a state, (2) using the services of an agent to establish or maintain the market in a state, and (3) leasing or owning tangible personal or real property in a state (excluding the leasing or licensing of computer software). Excludes from the definition of "physical presence" presence in a state for less than 15 days in a taxable year or presence in a state to conduct limited or transient business activity.
 
Provides that this Act shall not be construed to modify or affect any state business activity tax on a partnership, an S corporation or limited liability company, or a trust or estate that has a physical presence in the state or to supersede the authority of a state to enact a law or bring a law enforcement action against persons or entities engaged in illegal activity or sham transactions.
 
Sets forth a rule for computing the net income tax or other business activity tax liability of an affiliated group. 
 
Makes this Act applicable to taxable periods beginning on or after January 1, 2012.


Legislative actions:
action_date: 2011-10-21
text: Placed on the Union Calendar, Calendar No. 173.
action_date: 2011-10-21
text: Reported by the Committee on Judiciary. H. Rept. 112-257.
action_date: 2011-10-21
text: Reported by the Committee on Judiciary. H. Rept. 112-257.
action_date: 2011-07-07
text: Ordered to be Reported by Voice Vote.
action_date: 2011-07-07
text: Committee Consideration and Mark-up Session Held.
action_date: 2011-07-01
text: Subcommittee on Courts, Commercial and Administrative Law Discharged.
action_date: 2011-04-13
text: Subcommittee Hearings Held.
action_date: 2011-04-08
text: Referred to the Subcommittee on Courts, Commercial and Administrative Law.
action_date: 2011-04-08
text: Referred to the House Committee on the Judiciary.
action_date: 2011-04-08
text: Sponsor introductory remarks on measure. (CR E674-675)
action_date: 2011-04-08
text: Introduced in House
action_date: 2011-04-08
text: Introduced in House