Massachusetts DOR: Interplay of U.S. income tax treaties and combined reporting requirements

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The Massachusetts Department of Revenue ("Department") has issued draft guidance that explains:
  • The Massachusetts corporate income tax consequences that result when a non-U.S. corporation that has an item of income that is exempt from federal income tax pursuant to the provisions of a bilateral U.S. income tax treaty is to be included in a water’s edge combined group pursuant to M.G.L. c. 63, § 32B;
  • The Massachusetts corporate income tax consequences that result in the similar situation when a non-U.S. corporation that has such an item of exempt income is subject to Massachusetts' tax jurisdiction but is not required to be included in a combined group pursuant to M.G.L. c. 63, § 32B;
  • The determination of the Massachusetts non-income measure in such cases when the non-U.S. corporation is subject to Massachusetts tax. [Mass. Dept. of Rev., Draft Technical Information Release ("TIR") 10-16, 2/22/11]


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