General Corporation is taxable in a number of states. This year, General made a $100,000 sale from its A headquarters to an agency of the U.S. government. State A applies a throwback rule. In which state(s) will the sale be included in the sales factor numerator?

Question

Quizplus · Accepted Answer

The throwback rule applies to sales made to the U.S. government, which are generally exempt from state sales tax. However, the throwback rule allows states to include these sales in their sales factor numerators. In this case, State A applies the throwback rule, so the $100,000 sale will be included in the sales factor numerator in State A.

General Corporation Is Taxable in a Number of States