Homework
The purpose of this homework is to assess state taxation and the concept of apportionment. You will prepare a memo (750 to 1,000 words) for a client who is considering expanding business in multiple states. XYZ Corporation is your client and you regularly communicate with the CFO, Danny Client.
XYZ Corporation is a calendar year taxpayer that manufacturers equipment for businesses in Arizona, Kansas, and Oklahoma. XYZ has manufacturing facilities in Arizona and Oklahoma. There are various employees who reside and work in Kansas. The company headquarters are located in Arizona. A number of employees based in Arizona travel to Colorado and Utah to solicit sales from potential customers. After products are delivered to customers in Colorado and Utah, XYZ sends employees to install the products and conduct training. XYZ generates $100,200,000 of total revenue for all of its locations.
In the memo, address the following:
a. Summarize the client facts. Use your own words.
b. Determine the client issues: Does XYZ have income tax nexus in Colorado and Utah?
c. Provide advisory services by explaining the concept of nexus to the CFO, Danny Client, using the information from Public Law 86-272.
d. Summarize the apportionment and allocations that would apply to XYZ if the company is required to file tax returns in Colorado and Utah. Describe the apportionment items and details on how the apportionment is calculated for both states.
Provide the CFO with details of the potential tax and financial impact to XYZ Corporation for conducting business in multiple states.
Format your homework according to the give formatting requirements:
a. The answer must be double spaced, typed, using Times New Roman font (size 12), with one-inch margins on all sides.
b. The response also includes a cover page containing the title of the homework, the course title, the student's name, and the date. The cover page is not included in the required page length.
c. Also include a reference page. The references and Citations should follow APA format. The reference page is not included in the required page length.