Sending employees or representatives into the United States may, as a result, have the unwelcome effect of subjecting a foreign corporation’s worldwide income to state or local tax, on an apportioned basis. Federal tax treaty provisions will not protect foreign corporations from state and local taxes.
Peter Leonardis, in an article in Corporate Business Taxation Monthly, discusses a recent New York case that reaffirms a state’s jurisdiction to tax a foreign corporations’ income even when the foreign corporation has no permanent establishment in the state.
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This story is from the CCH’s monthly Focus on Tax newsletter, which provides advise and guidance on federal and state tax issues for tax and accounting professionals.
Read this article from CCH’s Journal of Taxation of Financial Products
