The Long Arm of California’s Market Sourcing and ‘Economic Nexus’ Standards–Reaching Nonresident Business Owners Everywhere

By Dakessian Law | September 8, 2022
Forbes (September 8, 2022):  The exodus of business owners leaving California raises an issue that may be counterintuitive for some—that California can and will tax the income of nonresidents who never set foot in the state. Unlike wages or compensation, which are typically taxed where services are performed, it is the footprint of the business […]
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Sourcing of Income to California and “Economic Nexus” Consequences for Nonresidents

By Dakessian Law | May 5, 2022
When it comes to the taxation of nonresidents, the California tax agencies—the Franchise Tax Board and the Office of Tax Appeals (“OTA”)—have held that a nonresident business owner, who never set foot in California (hereafter, the “State”), owed personal income taxes to the State. This is based on application of rules that look to the […]
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A Failure in Statutory Interpretation: The MTC and P.L. 86-272

By Dakessian Law | April 12, 2021
Tax Notes (April 12, 2021):  Relying on an overly broad interpretation of the U.S. Supreme Court’s decision in Wayfair, the Multistate Tax Commission appears poised to recommend weakening P.L. 86-272’s protection — even though Wayfair did not interpret and made no mention of the federal statute.   Click here to view entire article
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It’s Time To Invalidate Single-Sales Factor For Biz Income Tax

By Dakessian Law | December 7, 2020
Law360 (December 7, 2020) — We predict the 2020s will see just as seismic a shift in state tax constitutional law as the 2010s did with South Dakota v. Wayfair Inc.[1] Single-sales-factor apportionment will be subjected to a modern, nuanced judicial analysis, and another decades-old foundational precedent, Moorman Manufacturing Co. v. Bair[2] — upholding single-sales […]
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California’s Tax System Overhaul Creates More Questions Than Answers for Businesses

By Dakessian Law | April 18, 2018
Forbes, Los Angeles (April 18, 2018): In a little over 72 hours in June 2017, Governor Jerry Brown and legislative leaders used the state budget process to radically transform California’s tax system, which had been in place for roughly the past 87 years. To me, that seems a bit like a physician performing open heart […]
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A New Law Reorganizes California’s Tax System

By Dakessian Law | November 10, 2017
Los Angeles Lawyer Magazine (November 2017):  CALIFORNIA RECENTLY ENACTED ASSEMBLY BILL 102 (AB 102), dramatically shifting power from the state Board of Equalization (BOE). Also known as The Taxpayer Transparency and Fairness Act of 2017, AB 102 reorganizes the BOE and creates two new California taxing agencies that replace the BOE in appeals of state […]
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Through the Looking Glass – Reflections on the MTC

By Dakessian Law | July 31, 2017
Is the MTC the Multistate Tax Commission or the Multistate Tax Compact? After many years of litigating that question, we now know Commission is the better fit, as the courts have told us there is no binding compact. The commission “hazards much” to successfully argue the compact is merely an advisory agreement. But at what […]
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Surprise Ruling Says Some Local Taxes Need No Vote

By Dakessian Law | May 13, 2016
Last month, the Fourth District Court of Appeal issued an unexpected decision that could blow a hole through the constitutional vote requirements that protect Californians from unnecessary taxes. If the decision is not reversed by the California Supreme Court or de-published, it could result in the people of California losing their right to vote on […]
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