Indiana – General partner’s distributive income is operational income

July 2013


An out-of-state corporation’s only connection with Indiana was its general partnership interest in a partnership doing business in Indiana. The corporation argued that, although a general partner, its absence of management control over the partnership causes income from the partnership to be treated as investment income, which is sourced to the corporation’s domicile outside of Indiana. The tax court disagreed, finding that the mere fact that the corporation was a general partner gives its income from the partnership the character of operational income. [Vodafone Americas Inc. v. Indiana Department of State Revenue, Indiana Tax Court, No. 49T10-1002-TA-7 (6/18/13)]

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