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State Taxation Of Foreign Source Income Through Worldwide Combined Reporting, Thomas C. Pearson
State Taxation Of Foreign Source Income Through Worldwide Combined Reporting, Thomas C. Pearson
Vanderbilt Journal of Transnational Law
The primary alternative to worldwide combined reporting is the method used by the United States Government--the arm's length method of taxing foreign source income. Following the explanation of the arm's length method, this Note will outline briefly the due process and commerce clause limitations on a state's jurisdiction to tax and will describe the methods states have chosen to apportion the business income of a unitary business in order to comply with the commerce clause. The impact of worldwide combined reporting depends upon the apportionment formula adopted by the state and the state's definition of the terms "unitary business" and …