New Jersey throw out decision

September 2013


The tax court found that the state must use the same ‘economic nexus’ standard used to subject a licensor of intangible property to the state’s Corporation Business Tax that is uses to determine whether that same licensor is ‘subject to tax’ in other states for purposes of the state’s throw out rule. Because the licensor received royalties for property sold in all 50 states, the licensor was ‘subject to tax’ in all 50 states and, therefore, the throw out rule did not apply to any of its sales.

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