reglab/statecodes huggingface dataset:
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-14-1 - TAXPAYERS; BILL OF RIGHTS AND UNIFORM REVENUE PROCEDURES › Section 810-14-1-.32 - Penalty For Underpayment Due To Fraud

Current through Register Vol. 42, No. 9, June 28, 2024
(1) Any person who willfully filed a false or
			 fraudulent return shall be assessed for the amount of tax as determined by the
			 Department from the best available information with respect to such taxpayer.
			 To the amount of tax due, the Department shall add a penalty in an amount equal
			 to 50 percent of that portion of such underpayment which is attributable to
			 fraud. This penalty is in lieu of all other civil penalties.
(2) The term "fraud" shall include instances
			 where there is intentional wrongdoing, usually involving an element of
			 deception. Where direct evidence of fraud is not available, fraud may be
			 determined from the circumstances surrounding the taxpayer's acts or omissions.
			 The burden of proof on the issue of fraud shall be upon the Department. To
			 establish fraud, the Department must clearly and convincingly prove that a tax
			 deficiency is due to fraud with a deliberate intent to evade taxes. Negligence,
			 even if it is gross, does not necessarily establish fraud.
(3) The fraud penalty may be imposed for, but
			 is not limited to, the following situations:
(a) the taxpayer devises a fictitious scheme
			 to evade taxes (examples of this include setting up sham partnerships, doing
			 business under a fictitious name, making fictitious sales of stock to claim a
			 loss, etc.);
(b) the taxpayer
			 deliberately conceals income with the intent to evade taxes;
(c) the taxpayer claims excessive deductions,
			 exemptions, and/or credits (examples of this include claiming a false filing
			 status, taking exemptions for nonexistent children, taking clearly personal
			 expenses as business expenses, etc.).
Author:
George Mingledorff
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-14-1 - TAXPAYERS; BILL OF RIGHTS AND UNIFORM REVENUE PROCEDURES › Section 810-14-1-.33 - Penalty For Frivolous Return

Current through Register Vol. 42, No. 9, June 28, 2024
(1) A "frivolous return" penalty of up to
			 $250 may be imposed if any return:
(a) does
			 not contain information on which the substantial correctness of the self
			 assessment may be judged, or
(b)
			 contains information that on its face indicates the self assessment is
			 substantially incorrect and is due to either a position which is frivolous or a
			 desire (which appears on the purported return) or delay or impede the
			 administration of the state tax laws.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-14-1 - TAXPAYERS; BILL OF RIGHTS AND UNIFORM REVENUE PROCEDURES › Section 810-14-1-.33.01 - Assessment And Waive Of Civil Penalties

Current through Register Vol. 42, No. 9, June 28, 2024
(1) SCOPE. This regulation applies to the
			 assessment and waiver of civil penalties and does not include cases of
			 negligence or fraud. Additionally, this regulation does not apply to penalties
			 abated under Regulation
			 810-14-1-.05 dealing with the failure of the Department to comply with Section
			 40-2A-4 of the
Code of Ala. 1975
.
(2) PROCEDURE - Assessment.
(a) The Department may not assess civil
			 penalties in instances in which the taxpayer acted in good faith. For purposes
			 of this regulation, good faith includes, but is not limited to the following:
1. instances in which the taxpayer has been
			 cooperative during an audit and has a history of timely filing tax returns and
			 timely paying tax due; or
2.
			 instances in which the taxpayer relied upon erroneous written advice furnished
			 to the taxpayer by an employee of the Department if:
(i) the employee provided the written advice
			 in good faith while acting in an official capacity;
(ii) the written advice was reasonably relied
			 on by the taxpayer;
(iii) the
			 written advice was given in response to a specific written request of the
			 taxpayer; and
(iv) the penalties
			 did not result from the taxpayer's failure to provide adequate or accurate
			 information.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-14-1 - TAXPAYERS; BILL OF RIGHTS AND UNIFORM REVENUE PROCEDURES › Section 810-14-1-.34 - Interest On Underpayment Of Tax

Current through Register Vol. 42, No. 9, June 28, 2024
(1) Interest shall be added to any tax or
			 other amount due the Department which is not paid by the due date.
Interest on any delinquency shall be charged from the due date
				of the tax, except for the following:
(a) interest on delinquent license taxes
			 levied under
Code of Ala. 1975
, Chapter 12 of Title
			 40, shall be charged from the delinquent date as provided in
Code
			 of Ala. 1975
, subsection (e) of Section
			 40-12-10;
(b) interest on delinquent license tax and
			 registration fees levied on motor vehicles shall be charged beginning after the
			 period allowed for registration or renewal; and
(c) interest on the freight lines and
			 equipment companies tax levied in
Code of Ala. 1975
,
			 Section
			 40-21-52,
			 shall be charged from the delinquent date thereof.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-14-1 - TAXPAYERS; BILL OF RIGHTS AND UNIFORM REVENUE PROCEDURES › Section 810-14-1-.34.01 - Interest On Underpayment Of Tax-Large Corporations

Current through Register Vol. 42, No. 9, June 28, 2024
For "large corporate underpayment" as defined in I.R.C. Sec.
				6621, the interest rate on underpayment shall be as prescribed by I.R.C. Sec.
				6621(c)(1).
Author:
Michael Mason
Statutory Authority:
Code of Ala.
				  1975
, §
										40-1-44,
				  and Internal Revenue Code
				  26 U.S.C.
				  6621.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-14-1 - TAXPAYERS; BILL OF RIGHTS AND UNIFORM REVENUE PROCEDURES › Section 810-14-1-.35 - Interest On Refunds

Current through Register Vol. 42, No. 9, June 28, 2024
(1) The
			 Department shall pay interest on any refund computed from the date of
			 overpayment to the Department, except as follows:
(a) Interest on a refund resulting from a net
			 operating loss carryback shall be computed from the date the claim (amended
			 return) giving rise to the refund is filed.
(b) Interest on a refund of any income tax
			 previously paid through withholding or estimated payments, including a refund
			 of such tax resulting from a net operating loss carryover deduction, shall be
			 paid beginning 90 days after the due date of the return for which the refund is
			 claimed, or the date such return is actually filed, whichever is
			 later.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-14-1 - TAXPAYERS; BILL OF RIGHTS AND UNIFORM REVENUE PROCEDURES › Section 810-14-1-.36 - Government Contract For Examination Of Taxpayer's Records Where Compensation Contingent Upon Tax, Interest, Etc. Assessed Or Collected

Current through Register Vol. 42, No. 9, June 28, 2024
(1) It is the
			 policy of this State to prohibit any arrangement between the Department of
			 Revenue, a county, a municipality, or any other taxing authority within the
			 State and a private auditing firm for the examination of a taxpayer's books and
			 records, if the firm's compensation is determined, in whole or in part, by the
			 amount of taxes assessed or collected. Any arrangement whereby the private
			 auditing firm agrees or has an understanding with the taxing authority that all
			 or a part of the firm's compensation otherwise payable will be waived or
			 otherwise not paid if there is no assessment or no collection of tax or if less
			 than a certain amount is assessed and/or collected is prohibited.
(2) For the purposes of this regulation,
			 "tax" means and includes any tax, license fee, or other charge payable to the
			 State of Alabama, any agency thereof, any county or municipality or agency
			 thereof, or any other taxing authority within the State including, but not
			 limited to, sales and use taxes, rental taxes, business license taxes, or
			 franchise or any other fees or charges payable by the taxpayer on account of
			 its activities or property in, or income, sales, gross receipts or the like
			 derived from sources within, the State or any county or municipality. For
			 purposes of this regulation, "private auditing firm" means and includes any
			 person, firm or corporation that is not a governmental entity and that is
			 engaged in the business, in whole or in part, on behalf of the State or any
			 other taxing authority within the State such as counties, municipalities or any
			 agency thereof, of auditing or examining the books and records of a taxpayer to
			 determine whether one or more taxes have been properly collected, paid and/or
			 remitted by the taxpayer.
Authors:
George Mingledorff, Mark
				Griffin
Statutory Authority:
Code of Ala.
				  1975
, §
										40-2A-6.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-15-1 - HOSPITAL ASSESSMENT FOR MEDICAID › Section 810-15-1-.01 - Hospital Assessment For Medicaid (REPEALED)

Current through Register Vol. 42, No. 9, June 28, 2024
Author:
Traci Floyd
Statutory Authority:
Code of Ala.
				  1975
, §§
										40-2A-7(a)(5),
				  40-26B-72.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-16-1 - FILM PRODUCTION TAX INCENTIVES › Section 810-16-1-.01 - State Sales, Use, And Lodgings Tax Exemption For Qualified Production Companies (REPEALED)

Current through Register Vol. 42, No. 9, June 28, 2024
Author:
Angela Till
Statutory Authority:
Code of Ala.
				  1975
, §§
										40-2A-7(a)(5),
				  41-7A-40-41-7A-48.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-16-1 - FILM PRODUCTION TAX INCENTIVES › Section 810-16-1-.02 - Rebates Allowed For Qualified Production Companies (REPEALED)

Current through Register Vol. 42, No. 9, June 28, 2024
Authors:
Kelly Graham, Ann F. Winborne,
				  CPA
Statutory Authority:
Code of Ala.
				  1975
, §§
										40-2A-7(a)(5),
				  40-7A-40-40-7A-48.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-17-1 - ECONOMIC TAX INCENTIVES › Section 810-17-1-.01 - Economic Tax Incentives Reporting

Current through Register Vol. 42, No. 9, June 28, 2024
(1) Scope. This rule sets forth guidelines
			 and procedures to be used by State Agencies that are required to file annual
			 Economic Tax Incentive reports to the Legislature as required by Act
			 2016-389.
(2) Definitions. For
			 purposes of this rule, these terms shall be defined as follows:
(a) Department. The Alabama Department of
			 Revenue.
(b) Economic Tax Incentive
			 or Tax Incentive. Any tax credits, deductions, exemptions, abatements,
			 preferential rates, rebates, or other benefits where the government promises to
			 forgo tax revenues, and in exchange the taxpayer agrees to take some action
			 that contributes to economic development.
(c) State Agency. Any office, department,
			 board, commission, institution, or division within the executive branch of
			 state government, excluding the Alabama Department of Revenue, which
			 administers an Economic Tax Incentive by a legal requirement or authorization
			 to undertake any of the following actions:
1.
			 Promulgation of rules or regulations related to the Economic Tax
			 Incentive;
2. Determines, reviews,
			 or confirms eligibility or qualification of the Economic Tax
			 Incentive;
3. Enters into contracts
			 with an entity or individual related to a Tax Incentive;
4. Facilitates Economic Tax Incentives by
			 distributing funds to non-state agencies; and
5. Conducts oversight or substantial
			 administrative functions for an Economic Tax Incentive when the public purpose
			 associated with the Economic Tax Incentive is within the core mission of the
			 agency.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.01 - Multistate Tax Compact Rule Definitions

Current through Register Vol. 42, No. 9, June 28, 2024
(1)
Scope
. These
			 Rules are intended to set forth guidance concerning the application of the
			 apportionment and allocation provisions of §
								40-27-1,
Code of Ala. 1975
, titled "Multistate Tax Compact".
			 The apportionment guidelines set forth in these rules are applicable to any
			 taxpayer having business income, regardless of whether or not it has
			 nonbusiness income, and the allocation rules set forth in these rules are
			 applicable to any taxpayer having nonbusiness income, regardless of whether or
			 not it has business income.
(a) The only
			 exceptions to the allocation and apportionment guidelines contained in these
			 rules are those allowed pursuant to the authority of §
									40-27-1,
Code of Ala. 1975
, and the rules promulgated there
			 under.
(b) These rules are not
			 intended to modify existing guidelines concerning jurisdictional
			 standards.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.09 - Apportionment Formula

Current through Register Vol. 42, No. 9, June 28, 2024
(1) All
			 business income of the taxpayer shall be apportioned to this state by use of
			 the apportionment formula set forth in
Code of Ala.
			 1975
, §
								40-27-1,
			 §
								40-27-1,
			 Article IV.9, as amended.
(2) For
			 taxpayers with a business interest in an unincorporated entity (e.g.,
			 partnership, unincorporated joint-venture, limited liability company taxed as a
			 partnership, etc.), the apportionment formula shall include the pro rata share
			 of the unincorporated entity's factor data.
(3) For taxable years beginning on or after
			 January 1, 2021, all business income shall be apportioned to this state by
			 multiplying the income by the sales factor.
(4) For taxable years beginning before
			 January 1, 2021, the elements of the apportionment formula include the property
			 factor, the payroll factor and the sales factor. If any factor is not utilized
			 in the production of business income, it shall be eliminated, and the
			 denominator reduced accordingly. The taxpayer may request, or the Commissioner
			 may require, the use of a replacement factor in lieu of the eliminated factor
			 where appropriate as provided for in §
								40-27-1,
			 Article IV.18 and any rules promulgated thereunder.
(a) For taxable years beginning on or after
			 December 31, 2010 and taxable years beginning on or before January 1, 2021. The
			 apportionment formula gives double-weight to the sales factor and equal weight
			 to both the property and payroll factors.
1.
			 EXAMPLE: Company A is a multistate entity which does business both within and
			 without of Alabama. Company A shall apportion its income using the
			 apportionment formula as follows:
Alabama
Everywhere
Property
500,000
600,000
Payroll
1,500,000
2,000,000
Sales
2,500,000
7,000,000
Company A must compute its apportionment formula as
				follows:
Property (500,000/600,000)
83.3333%
Payroll (1,500,000/2,000,000)
75.0000%
Sales (2,500,000/7,000,000)
71.4286%
= (35.7143% X 2)
Sum of Factor Percentages
229.7619%
Divide by Number of Factors Used
÷ 4
Apportionment Factor Average
							 Percentage:
57.4405%
2.
			 EXAMPLE: Company B is a multistate entity which does business both within and
			 without of Alabama. Company B has property and sales within Alabama but does
			 not have any payroll within Alabama. Therefore, Company B shall eliminate the
			 payroll factor and reduce the denominator. Company B shall apportion its income
			 by doing the following:
Alabama
Everywhere
Property
500,000
600,000
Payroll
0
0
Sales
2,500,000
7,000,000
Company B must compute its apportionment formula as
				follows:
Property
(500,000/ 600,000) 83.3333%
Payroll
(0/0) 00.0000%
Sales
(2,500,000/ 7,000,000) 71.4286%
= (35.7143% X 2)
Sum of Factor Percentages
154.7619%
Divide by Number of Factors Used
÷3
Apportionment Factor Average
							 Percentage
51.5873%
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.11 - Property Factor: Valuation

Current through Register Vol. 42, No. 9, June 28, 2024
(1)
Property Factor: Valuation of
			 Owned Property
.
(a) Property owned
			 by the taxpayer shall be valued at its original cost. As a general rule,
			 "original cost" is deemed to be the basis of the property at the time of
			 acquisition by the taxpayer and adjusted by subsequent capital additions or
			 improvements thereto and partial disposition thereof, by reason of sale,
			 exchange, abandonment, etc. However, intangible drilling and development costs
			 shall be included in the property factor whether or not they have been expensed
			 for either federal or state tax purposes. See §
									40-18-6,
			 Code of Ala.
1975
, and the rules promulgated
			 thereunder for basis determination rules.
1.
			 EXAMPLE: The taxpayer acquired a factory building in Alabama at a cost of
			 $500,000 and, 18 months later, expended $100,000 for major remodeling of the
			 building. Taxpayer files its return for the current taxable year on the
			 calendar-year basis. Depreciation deduction in the amount of $22,000 was
			 claimed with respect to the building on the return for the current taxable
			 year. The value of the building includable in the numerator and denominator of
			 the property factor is $600,000; the depreciation deduction is not taken into
			 account in determining the value of the building for purposes of the
			 factor.
2. EXAMPLE: During the
			 current taxable year, Corporation X merges into Corporation Y in a tax-free
			 reorganization under the Internal Revenue Code. At the time of the merger,
			 Corporation X owns a factory which X built five years earlier at a cost of
			 $1,000,000. X has been depreciating the factory at the rate of two percent per
			 year, and its basis in X's hands at the time of the merger is $900,000. Since
			 the property is acquired by Y in a transaction in which, under the Internal
			 Revenue Code, its basis in Y's hands is the same as its basis in X's hands, Y
			 includes the property in Y's property factor at X's original cost, without
			 adjustment for depreciation, i.e. $1,000.000.
3. EXAMPLE: Corporation Y acquires the assets
			 of Corporation X in a liquidation by which Y is entitled to use its stock cost
			 as the basis of the X assets under Internal Revenue
Code
			 1954
, §334(b)(2) (i.e. stock possessing 80 percent control is
			 purchased and liquidated within two years). Under these circumstances, Y's cost
			 of the assets is the purchase price of the X stock, prorated over the X assets.
			 If the original cost of property is unascertainable, the property is included
			 in the factor at its fair market value as of the date of acquisition by the
			 taxpayer.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.12 - Property Factor: Averaging Property Values

Current through Register Vol. 42, No. 9, June 28, 2024
(1) As a general rule, the average value of
			 property owned by the taxpayer shall be determined by averaging the values at
			 the beginning and ending of the tax period. However, the Commissioner may
			 require or allow averaging by monthly values if that method of averaging is
			 required to properly reflect the average value of the taxpayer's property for
			 the tax period.
(a) Averaging by monthly
			 values will generally be applied if substantial fluctuations in the values of
			 the property exist during the tax period or if property is acquired after the
			 beginning of the tax period or disposed of before the end of the tax period.
1. EXAMPLE: The monthly value of the
			 taxpayer's property was as follows:
January
$ 2,000
July
$ 15,
000
February
2,000
August
17,
000
March
3,000
September
23,
000
April
3,500
October
25,
000
May
4,500
November
13,
000
June
10,000
December
2,
000
$25,000
$ 95,
000
Total
120,
000
The average value of the taxpayer's property includable in the
				property factor for the income year is determined as follows:
$120,000/12 = $10,000
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.13 - Payroll Factor: In General

Current through Register Vol. 42, No. 9, June 28, 2024
(1) The payroll factor of the apportionment
			 formula for each trade or business of the taxpayer shall include the total
			 amount paid by the taxpayer in the regular course of its trade or business for
			 compensation during the tax period.
(2) Definitions: For purposes of Rule
			 810-27-1-.13, the following terms have the following meanings unless the
			 context requires otherwise.
(a)
Employee
. Any person who, under the usual common-law
			 rules applicable in determining the employer-employee relationship, has the
			 status of an employee. Generally, a person will be presumed to be an employee
			 if such person is included by the taxpayer as an employee for purposes of the
			 payroll taxes imposed by the Federal Insurance Contributions Act. However, for
			 purposes of this rule, a leased employee is an employee of the client (lessee)
			 organization. A leased employee is also treated as an employee of the employee
			 leasing company.
(b)
Employee Leasing Company
. A business that contracts
			 with a client company to supply workers to perform services for the client
			 company. The term "employee leasing company" does not include private
			 employment agencies that provide workers to employers on a temporary help basis
			 or entities such as driver-leasing companies which lease employees to another
			 business to perform a specific service unless the total amount of compensation
			 paid to the employee leasing company during the tax period exceeds 5% of
			 compensation paid everywhere during the tax period. This threshold should be
			 calculated excluding the amount of compensation paid to the employee leasing
			 company.
(c)
Independent contractor
. Any person who performs
			 services for a taxpayer but who is not an employee of the taxpayer, and who is
			 not otherwise subject to the supervision or control of the taxpayer in the
			 performance of the services. In general, a person is treated as an independent
			 contractor with respect to a taxpayer if that person's actions would not
			 represent an employer- employee relationship for federal tax
			 purposes.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.14 - Payroll Factor: Compensation Paid In This State

Current through Register Vol. 42, No. 9, June 28, 2024
(1) Compensation is paid in Alabama if any
			 one of the following tests, applied consecutively, are met if:
(a) The employee's service is performed
			 entirely within Alabama.
(b) The
			 employee's service is performed both within and outside Alabama, but the
			 service performed outside of Alabama is incidental to the employee's service
			 within Alabama. Service is "incidental" when it is temporary or transitory in
			 nature, or when the service is rendered in connection with an isolated
			 transaction.
(c) The employee's
			 services are performed both within and outside of Alabama, the employee's
			 compensation will be attributed to Alabama if:
1. the employee's base of operations is in
			 Alabama; or
2. there is no base of
			 operations in any state in which some part of the service is performed, but the
			 place from which the service is directed or controlled is in Alabama;
			 or
3. the base of operations or the
			 place from which the service is directed or controlled is not in any state in
			 which some part of the service is performed but the employee's residence is in
			 Alabama.
(i) The "place from which the
			 service is directed or controlled" is the place from which the power to direct
			 or control is exercised by the taxpayer.
(ii) The "base of operations" is the place of
			 more or less permanent nature from which the employee starts his work and to
			 which he customarily returns in order to receive instructions from the taxpayer
			 or communications from his customers or other persons or to replenish stock or
			 other materials, repair equipment, or perform any other functions necessary to
			 the exercise of his trade or profession at some other point or
			 points.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.15 - Sales Factor

Current through Register Vol. 42, No. 9, June 28, 2024
(1)
Sales Factor: In General.
(a)
Code of Ala. 1975
, §
									40-27-1, Article IV.1(g)
			 defines the term "sales" to mean all gross receipts of the taxpayer not
			 allocated under paragraphs through (8) of §
									40-27-1, Article IV.1(g) .
			 Thus, for the purposes of the sales factor of the apportionment formula for
			 each trade or business of the taxpayer, the term "sales" means all gross
			 receipts derived by the taxpayer from transactions or activity in the regular
			 course of the trade or business. The following are rules for determining
			 "sales" in various situations:
1. In the case
			 of a taxpayer engaged in manufacturing and selling or purchasing and reselling
			 goods or products, "sales" includes all gross receipts from the sales of such
			 goods or products (or other property of a kind which would properly be included
			 in the inventory of the taxpayer if on hand at the close of the tax period)
			 held by the taxpayer primarily for sale to customers in the ordinary course of
			 its trade or business. Gross receipts for this purpose means gross sales less
			 returns and allowances, and includes all interest income, service charges,
			 carrying charges, or time-price differential charges incidental to such sales.
			 Federal and state excise taxes (including sales taxes) shall be included as
			 part of such receipts if the taxes are passed on to the buyer or included as
			 part of the selling price of the product.
2. In the case of cost plus fixed fee
			 contracts, such as the operation of a government-owned plant for a fee, "sales"
			 includes the entire reimbursed cost plus the fee.
3. In the case of a taxpayer engaged in
			 providing services, such as the operation of an advertising agency or the
			 performance of equipment service contracts or research and development
			 contracts, "sales" includes the gross receipts from the performance of such
			 services, including fees, commissions, and similar items.
4. In the case of a taxpayer engaged in
			 renting real or tangible property, "sales" includes the gross receipts from the
			 rental, lease, or licensing the use of the property.
5. In the case of a taxpayer engaged in the
			 sale, assignment, or licensing of intangible personal property such as patents
			 and copyrights, "sales" includes the gross receipts therefrom.
6. If a taxpayer derives receipts from the
			 sale of equipment used in its business, those receipts constitute sales. For
			 example, a truck express company owns a fleet of trucks and sells its trucks
			 under a regular replacement program. The gross receipts from the sales of the
			 trucks are included in the sales factor.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.16 - Sales Factor: Tangible Personal Property

Current through Register Vol. 42, No. 9, June 28, 2024
(1)
Sales Factor: Sales
			 of Tangible Personal Property in this State
.
(a) Gross receipts from sales of tangible
			 personal property (except sales to the United States Government are in this
			 state; see subparagraph (b)) are in this state:
1. If the property is delivered or shipped to
			 a purchaser within this state regardless of the f.o.b. point or other
			 conditions of sale.
2. For tax
			 periods beginning before January 1, 2021, if the property is shipped from an
			 office, store, warehouse, factory, or other place of storage in this state and
			 the taxpayer is not taxable in the state of the purchaser.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.17 - Sales Factor: Sourcing Sales Derived From Services Rendered To Individual And Unrelated Business Customers

Current through Register Vol. 42, No. 9, June 28, 2024
(1) Effective for tax years beginning after
			 December 31, 2010, §
								40-27-1,
Code of Ala. 1975
, has been amended to state that
			 sales other than sales of tangible personal property are to be sourced to this
			 state if the taxpayer's market for the sale is in this state. For previous tax
			 years, §
								40-27-1,
Code of Ala. 1975
, sourced these sales to this state
			 if the "income producing activity" was performed in this state based on "cost
			 of performance". This rule sets forth the Alabama Department of Revenue's
			 policy regarding the sourcing of sales derived from services rendered to
			 individual and unrelated business customers.
(2) The taxpayer's market for a sale is in
			 this state if and to the extent the service is delivered to a location in this
			 state. This rule interprets when and to what extent a service will be
			 considered delivered to a location in this state under certain situations.
(a) In the case where the taxpayer's customer
			 is an individual, the taxpayer shall source receipts from the sale of a service
			 consistent with this subparagraph
.
1. In the case where a taxpayer's customer is
			 an individual and the service provided is a direct personal service, the sale
			 shall be sourced to the state where the customer received the direct personal
			 service. "Direct personal services" are services that are delivered or rendered
			 in person by or on behalf of the service provider to the customer. This type of
			 service requires the service provider and the customer be together at one
			 location. Direct personal services include, but are not limited to, salon
			 services, medical and dental services including examinations and surgeries,
			 dance lessons and other similar services.
(i)
			 Example: Hair Cutting Corp, located in Alabama and other states, provides hair
			 grooming services for individuals. Receipts from hair grooming services
			 performed at Hair Cutting Corp locations in Alabama shall be sourced to this
			 state. Receipts from hair grooming services performed at Hair Cutting Corp
			 locations outside of Alabama shall be sourced to the state in which the
			 services were performed.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.18 - Special Rules

Current through Register Vol. 42, No. 9, June 28, 2024
(1)
Special Rules: In General
. If the allocation and
			 apportionment provisions of §
								40-27-1,
Code of Ala. 1975
, do not fairly represent the extent
			 of the taxpayer's business activity in Alabama, the taxpayer may petition for
			 or the Commissioner may require, in respect to all or any part of the
			 taxpayer's business activity, if reasonable:
(a) separate accounting;
(b) the exclusion of any one or more of the
			 factors;
(c) the inclusion of one
			 or more additional factors which will fairly represent the taxpayer's business
			 activity in this state; or
(d) the
			 employment of any other method to effectuate an equitable allocation and
			 apportionment of the taxpayer's income.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.18.01 - Special Rules: Airlines

Current through Register Vol. 42, No. 9, June 28, 2024
(1)
			 In General. Where an airline has income from sources both within and without
			 Alabama, the amount of business income from sources within Alabama shall be
			 determined pursuant to §§
								40-27-1 and
			 40-27-1.1,
Code of Ala. 1975
, except as modified by this rule.
(a) Apportionment of Business Income.
			 Business income is determined in accordance with §
									40-27-1.1,
Code of Ala. 1975
.
(b) All business income must be apportioned
			 to Alabama in accordance with the calculation provided in §
									40-27-1,
Code of Ala. 1975
, and Rule 810-27-1-09.
1. For tax periods beginning on or after
			 January 1, 2021, the property factor and the payroll factor are no longer
			 considered in calculating a taxpayer's Alabama apportionment factor.
2. The industry specific definitions and
			 guidance provided in this rule for property and payroll are applicable for tax
			 periods beginning on or after January 1, 2021, when:
(i) A taxpayer petitions and is granted
			 approval from the department to employ an alternative apportionment method in
			 accordance with
			 40-27-1,
Code of Ala. 1975
.
(ii) Measuring against nexus thresholds
			 pursuant to §
											40-18-31.2,
Code of Ala. 1975
.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.18.03 - Special Rules: Publishing

Current through Register Vol. 42, No. 9, June 28, 2024
The following special rules are established with respect to
				the apportionment of income derived from the publishing, sale, licensing or
				other distribution of books, newspapers, magazines, periodicals, trade journals
				or other printed material.
(1) In
			 General. Except as specifically modified by this rule, when a person in the
			 business of publishing, selling, licensing or distributing newspapers,
			 magazines, periodicals, trade journals or other printed material has income
			 from sources both within and without Alabama, the amount of business income
			 from sources within Alabama from such business activity shall be determined
			 pursuant to §§
								40-27-1,
			 and
			 40-27-1.1,
Code of Ala. 1975
, and the rules promulgated
			 thereunder.
(2) Definitions. The
			 following definitions are applicable to the terms contained in this rule,
			 unless the context clearly requires otherwise.
(a) "Outer-jurisdictional property" means
			 certain types of tangible personal property, such as orbiting satellites,
			 undersea transmission cables and the like, that are owned or rented by the
			 taxpayer and used in the business of publishing, licensing, selling or
			 otherwise distributing printed material, but which are not physically located
			 in any particular state.
(b) "Print
			 or printed material" includes, without limitation, the physical embodiment or
			 printed version of any thought or expression including, without limitation, a
			 play, story, article, column or other literary, commercial, educational,
			 artistic or other written or printed work. The determination of whether an item
			 is or consists of print or printed material shall be made without regard to its
			 content. Printed material may take the form of a book, newspaper, magazine,
			 periodical, trade journal or any other form of printed matter and may be
			 contained on any medium or property.
(c) "Purchaser" and "Subscriber" mean the
			 individual, residence, business or other outlet which is the ultimate or final
			 recipient of the print or printed material. Neither of such terms shall mean or
			 include a wholesaler or other distributor of print or printed
			 material.
(d) "Terrestrial
			 facility" shall include any telephone line, cable, fiber optic, microwave,
			 earth station, satellite dish, antennae or other relay system or device that is
			 used to receive, transmit, relay or carry any data, voice, image or other
			 information that is transmitted from or by any outer-jurisdictional property to
			 the ultimate recipient thereof.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.18.04 - Special Rules: Railroads

Current through Register Vol. 42, No. 9, June 28, 2024
The following special rules are established in respect to
				railroads
(1)
In
			 General
. Where a railroad has income from sources both within and
			 without Alabama, the amount of business income from sources within Alabama must
			 be determined pursuant to this rule. In such cases, the first step is to
			 determine what portion of the railroad's income constitutes "business" income
			 and which portion constitutes "nonbusiness" income. Nonbusiness income is
			 directly allocable to specific states pursuant to the provisions of §
								40-27-1,
Code of Ala. 1975
, inclusive. Business income is
			 apportioned among the states in which the business is conducted. The sum of (1)
			 the items of nonbusiness income directly allocated to Alabama and (2) the
			 amount of business income attributable to Alabama constitutes the amount of the
			 taxpayer's entire net income which is subject to tax by Alabama.
(2)
Business and Nonbusiness
			 Income
. For definitions, rules and examples for determining business
			 and nonbusiness income, see Rule
			 810-27-1-.01.
			 "Business income" must be determined in accordance with §
								40-27-1.1,
Code of Ala. 1975
. Nonbusiness income is defined in
			 §
								40-27-1,
Code of Ala. 1975
.
(3)
Apportionment of Business
			 Income
.
(a) In General. Business
			 income is apportioned to Alabama in accordance with the calculation provided in
			 §
									40-27-1,
Code of Ala. 1975
, and Rule
			 810-27-1-.09.
			 The apportionment percentage is then applied to business income to determine
			 the amount apportioned to Alabama.
1. For tax
			 periods beginning on or after January 1, 2021, the property factor and the
			 payroll factor are no longer considered in calculating a taxpayer's Alabama
			 apportionment factor.
2. The
			 industry specific definitions and guidance provided in this rule for property
			 and payroll are applicable for tax periods beginning on or after January 1,
			 2021, when:
(i) A taxpayer petitions and is
			 granted approval from the department to employ an alternative apportionment
			 method in accordance with §
											40-27-1,
Code of Ala. 1975
.
(ii) Measuring against nexus thresholds
			 pursuant to §
											40-18-31.2,
Code of Ala. 1975
.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.18.05 - Special Rules: Television And Radio

Current through Register Vol. 42, No. 9, June 28, 2024
The following special rules are established in respect to the
				apportionment of income from television and radio broadcasting by a broadcaster
				that is taxable both in Alabama and in one or more other states.
(1) In General. When a person in the business
			 of broadcasting film or radio programming, whether through the public airwaves,
			 by cable, direct or indirect satellite transmission or any other means of
			 communication, either through a network (including owned and affiliated
			 stations) or through an affiliated, unaffiliated or independent television or
			 radio broadcasting station, has income from sources both within and without
			 Alabama, the amount of business income from sources within Alabama shall be
			 determined pursuant to §§
								40-27-1,
			 and
			 40-27-1.1,
Code of Ala. 1975
, and the rules promulgated
			 thereunder by Alabama, except as modified by this rule.
(2) Business and Nonbusiness Income. For
			 definitions, rules and examples for determining whether income shall be
			 classified as "business" or "nonbusiness" income, see Rule
			 810-27-1-.01.
			 Business income is determined in accordance with §
								40-27-1.1,
Code of Ala. 1975
.
(3) Definitions. The following definitions
			 are applicable to the terms contained in this rule, unless the context clearly
			 requires otherwise.
(a) "Film" or "film
			 programming" means any and all performances, events or productions telecast on
			 television, including but not limited to news, sporting events, plays, stories
			 or other literary, commercial, educational or artistic works, through the use
			 of video tape, disc or any other type of format or medium.
1. Each episode of a series of films produced
			 for television shall constitute a separate "film" notwithstanding that the
			 series relates to the same principal subject and is produced during one or more
			 tax periods.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1 - MULTISTATE TAX COMPACT › Section 810-27-1-.18.06 - Special Rules: Trucking Companies

Current through Register Vol. 42, No. 9, June 28, 2024
The following special rules are established with respect to
				trucking companies.
(1)
In
			 General
. As used in this rule, the term "trucking company" means a
			 motor common carrier, a motor contract carrier, or an express carrier which
			 primarily transports tangible personal property of others by motor vehicle for
			 compensation. Where a trucking company has income from sources both within and
			 without Alabama, the amount of business income from sources within Alabama
			 shall be determined pursuant to this rule. In such cases, the first step is to
			 determine what portion of the trucking company's income constitutes "business"
			 income and what portion constitutes "nonbusiness" income under §
								40-27-1,
			 and
			 40-27-1.1,
Code of Ala. 1975
, and Rule
			 810-27-1-.01.
			 Nonbusiness income is directly allocable to specific states pursuant to the
			 provisions of §
								40-27-1,
Code of Ala. 1975
, inclusive. Business income is
			 apportioned among the states in which the business is conducted and pursuant to
			 the sales apportionment factors set forth in this rule. The sum of (i) the
			 items of nonbusiness income directly allocated to Alabama and (ii) the amount
			 of business income attributable to Alabama constitutes the amount of the
			 taxpayer's entire net income which is subject to tax in Alabama.
(2)
Business and Nonbusiness
			 Income
. For definitions, rules, and examples for determining
			 business and nonbusiness income, see Rule
			 810-27-1-.01.
			 Business income is determined in accordance with §
								40-27-1.1,
Code of Ala. 1975
.
(3)
Apportionment of Business
			 Income
.
(a)
In
			 General
. Business income is apportioned to Alabama in accordance with
			 the calculation provided in §
									40-27-1,
Code of Ala. 1975
, and Rule
			 810-27-1-.09.
			 The apportionment percentage is then applied to business income to determine
			 the amount apportioned to Alabama.
1. For tax
			 periods beginning on or after January 1, 2021, the property factor and the
			 payroll factor are no longer considered in calculating a taxpayer's Alabama
			 apportionment factor.
2. The
			 industry specific definitions and guidance provided in this rule for property
			 and payroll are applicable for tax periods beginning on or after January 1,
			 2021, when:
(i) A taxpayer petitions and is
			 granted approval from the department to employ an alternative apportionment
			 method in accordance with
			 40-27-1,
Code of Ala. 1975
.
(ii) Measuring against nexus thresholds
			 pursuant to §
											40-18-31.2,
Code of Ala. 1975
.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1-4 - MULTISTATE TAX COMPACT › Section 810-27-1-4-.01 - Multistate Tax Compact Regulation Definitions

Current through Register Vol. 42, No. 9, June 28, 2024
(1) Scope. These Regulations are intended to
			 set forth rules concerning the application of the apportionment and allocation
			 provisions of Article IV ("Division of Income") of
Code of Ala.
			 1975
, Section
			 40-27-1,
			 titled "Multistate Tax Compact". The apportionment rules set forth in these
			 regulations are applicable to any taxpayer having business income, regardless
			 of whether or not it has nonbusiness income, and the allocation rules set forth
			 in these regulations are applicable to any taxpayer having nonbusiness income,
			 regardless of whether or not it has business income.
(a) The only exceptions to the allocation and
			 apportionment rules contained in these Regulations are those set forth in
			 regulation
			 810-27-1-4-.18 pursuant to the authority of
Code of Ala. 1975
,
			 Section
			 40-27-1,
			 Article IV.18.
(b) These
			 regulations are not intended to modify existing rules concerning jurisdictional
			 standards.
(c) The examples used
			 throughout these regulations are illustrative only and do not purport to set
			 forth all pertinent facts.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1-4 - MULTISTATE TAX COMPACT › Section 810-27-1-4-.02 - Application Of Apportionment And Allocation

Current through Register Vol. 42, No. 9, June 28, 2024
(1) Definitions.
(a)
1. For
			 all taxable years ending before January 1, 1997,"taxpayer" means any
			 corporation, Subchapter K entity, firm, association, governmental unit or
			 agency or person acting as a business entity in more than one state.
2. For all taxable years beginning after
			 December 31, 1996, "taxpayer" means any corporation, Subchapter K entity, firm,
			 association, governmental unit or agency or other person acting as a business
			 entity in more than one state, but does not include any individual.
Alabama Administrative Code › Title 810 - ALABAMA DEPARTMENT OF REVENUE › Chapter 810-27-1-4 - MULTISTATE TAX COMPACT › Section 810-27-1-4-.03 - Taxable In Another State. (REPEALED)

Current through Register Vol. 42, No. 9, June 28, 2024
Author:
Peter M. Petrillo, Jr.
Statutory Authority:
Code of Ala. 1975,
				  §§ 40-2 A-7(a)(5),
				  40-18-57.