Repercussions of Gillette v. FTB: Will Taxpayers in Other MTC Member States Seek Right to Apportionm(1)

The Bloomberg BNA Tax Management Weekly State Tax Report filters through current state developments and analyzes those critical to multistate tax planning.

Following the surprising California Court of Appeal decision in Gillette Co. v. Franchise Tax Board, taxpayers in Multistate Tax Compact member states may press for the long-denied right to elect to use the equally weighted three-factor apportionment formula. On July 24, 2012, the court held that the Multistate Tax Compact, to which California was a signatory, is a binding, multistate agreement that obligates its member states to offer their multistate taxpayers the option of using either the compact's three-factor formula to apportion income, or the state's own alternative apportionment formula.