California Regulation §25136-2, Sales Other Than Sales Of Tangible Personal Property - Part I: Sales of Services

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California Code of Regulations (CCR) § 25136-2, regarding sales other than sales of tangible personal property, became final on Feb. 27, 2012, and is effective retroactively to tax years beginning on or after Jan. 1, 2011. The regulation implements two sets of “cascading” rules for determining the assignment of sales for taxpayers that elect single sales factor apportionment. The two sets of rules address the assignment of sales related to both services and intangible property. This article, the first of two, covers assignment of the sale of services.