Is a physical presence required to establish nexus for franchise and excise taxes?

No, a taxpayer without a physical presence in the state may have substantial nexus in the state for franchise and excise tax purposes if it meets the bright-line presence definition of substantial nexus. The bright-line presence standards for substantial nexus operate such that if a taxpayer has at least $50,000 of property or payroll in the state, at least $500,000 of receipts in the state, or at least 25% of its total property, payroll, or receipts in Tennessee, it has substantial nexus with Tennessee without considering any other connections with the state.

See related article: What legislation was passed in 2015 that affects franchise & excise tax?

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