Summary
Pennsylvania is facing a substantial budget shortfall in the fiscal years ending Jun 30, 2009 and 2010, and needs to raise revenue. Combined reporting is seen by some as a way to do so. Under combined reporting, a parent and its subsidiaries are treated as one income tax entity. The income, loss, and apportionment factors of all unitary businesses are combined and reported on one income tax return. The use of combined reporting is growing nationally and may soon be coming to Pennsylvania. To provide a more level playing field, many states have either passed or proposed legislation that will require combined reporting. It is likely that more and more states, possibly Pennsylvania included, will also switch to single sales factor apportionment and market-based sourcing for the sales of services in an effort to shift the tax burden toward out-of-state taxpayers.
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Extract
State & Local Tax
Pennsylvania is facing a substantial budget shortfall in the fiscal years ending June 30, 2009 and 2010, and needs to raise revenue. Combined reporting is seen by some as a way to do so. Under combined reporting, a parent and its subsidiaries are treated as one income tax ent...
See the full content of this document
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