General Corporation is taxable in a number of states. This year, General made a $100,000 sale from its State A headquarters to a customer in State B. This activity is not sufficient for General to create nexus with State B. State A applies a throwback rule but State B does not. In which state(s) will the sale be included in the sales factor numerator?

Question

Quizplus · Accepted Answer

The throwback rule in State A means that sales shipped to a state where the company does not have nexus are "thrown back" and included in the sales factor numerator of the originating state, in this case, State A. Since General Corporation does not create nexus with State B, the sale is included in State A's sales factor numerator, not State B's.

General Corporation Is Taxable in a Number of States