| 1 | 1 | | REFERENCE TITLE: corporate tax; business income; allocation State of Arizona House of Representatives Fifty-seventh Legislature First Regular Session 2025 HB 2850 Introduced by Representative De Los Santos AN ACT amending sections 43-1139 and 43-1147, Arizona Revised Statutes; relating to corporate income tax. (TEXT OF BILL BEGINS ON NEXT PAGE) |
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| 9 | 9 | | REFERENCE TITLE: corporate tax; business income; allocation |
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| 10 | 10 | | State of Arizona House of Representatives Fifty-seventh Legislature First Regular Session 2025 |
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| 11 | 11 | | HB 2850 |
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| 12 | 12 | | Introduced by Representative De Los Santos |
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| 14 | 14 | | REFERENCE TITLE: corporate tax; business income; allocation |
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| 24 | 24 | | State of Arizona |
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| 26 | 26 | | House of Representatives |
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| 28 | 28 | | Fifty-seventh Legislature |
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| 30 | 30 | | First Regular Session |
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| 32 | 32 | | 2025 |
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| 40 | 40 | | HB 2850 |
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| 44 | 44 | | Introduced by |
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| 46 | 46 | | Representative De Los Santos |
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| 64 | 64 | | AN ACT |
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| 68 | 68 | | amending sections 43-1139 and 43-1147, Arizona Revised Statutes; relating to corporate income tax. |
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| 74 | 74 | | (TEXT OF BILL BEGINS ON NEXT PAGE) |
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| 78 | 78 | | Be it enacted by the Legislature of the State of Arizona: Section 1. Section 43-1139, Arizona Revised Statutes, is amended to read: START_STATUTE43-1139. Allocation of business income A. Except as provided in subsection B of this section, the taxpayer shall elect to apportion all business income to this state for taxable years beginning from and after: 1. December 31, 2006 through December 31, 2007 by either: (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. (b) Multiplying the income by a fraction, the numerator of which is two times the property factor plus two times the payroll factor plus six times the sales factor, and the denominator of which is ten. 2. December 31, 2007 through December 31, 2008 by either: (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. (b) Multiplying the income by a fraction, the numerator of which is one and one-half times the property factor plus one and one-half times the payroll factor plus seven times the sales factor, and the denominator of which is ten. 3. December 31, 2008 through December 31, 2013 by either: (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. (b) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus eight times the sales factor, and the denominator of which is ten. 4. December 31, 2013 through December 31, 2014 by either: (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. (b) Multiplying the income by a fraction, the numerator of which is seven and one-half times the property factor plus seven and one-half times the payroll factor plus eighty-five times the sales factor, and the denominator of which is one hundred. 5. December 31, 2014 through December 31, 2015 by either: (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. (b) Multiplying the income by a fraction, the numerator of which is five times the property factor plus five times the payroll factor plus ninety times the sales factor, and the denominator of which is one hundred. 6. December 31, 2015 through December 31, 2016 by either: (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. (b) Multiplying the income by a fraction, the numerator of which is two and one-half times the property factor plus two and one-half times the payroll factor plus ninety-five times the sales factor, and the denominator of which is one hundred. 7. December 31, 2016 through December 31, 2025 by either: (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. (b) Multiplying the income by the sales factor. 8. December 31, 2025 by multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. B. All business income of a taxpayer engaged in air commerce shall be apportioned to this state by multiplying the income by a fraction, the numerator of which is the revenue aircraft miles flown within this state for flights beginning or ending in this state and the denominator of which is the total revenue aircraft miles flown by the taxpayer's aircraft everywhere. This subsection applies to each taxpayer, including a combined group filing a combined return or an affiliated group electing to file a consolidated return under section 43-947, if fifty per cent percent or more of that taxpayer's gross income is derived from air commerce. For the purposes of this subsection: 1. "Air commerce" means transporting persons or property for hire by aircraft in interstate, intrastate or international transportation. 2. "Revenue aircraft miles flown" has the same meaning prescribed by the United States department of transportation uniform system of accounts and reports for large certificated air carriers (14 Code of Federal Regulations part 241). END_STATUTE Sec. 2. Section 43-1147, Arizona Revised Statutes, is amended to read: START_STATUTE43-1147. Situs of sales of other than tangible personal property; rules; definitions A. For taxable years beginning before December 31, 2025, except as provided by subsection B of this section, sales, other than sales of tangible personal property, are in this state if either of the following applies: 1. The income-producing activity is performed in this state. 2. The income-producing activity is performed both in and outside this state and a greater proportion of the income-producing activity is performed in this state than in any other state, based on costs of performance. B. For taxable years beginning from and after December 31, 2013 through December 31, 2025, a multistate service provider may elect to treat sales from services as being in this state based on a combination of income-producing activity sales and market sales. If the election under this subsection is made pursuant to subsection C F of this section, the sales of services that are in this state shall be determined for taxable years beginning from and after: 1. December 31, 2013 through December 31, 2014, by the sum of the following: (a) Eighty-five percent of the market sales. (b) Fifteen percent of the income-producing activity sales. 2. December 31, 2014 through December 31, 2015, by the sum of the following: (a) Ninety percent of the market sales. (b) Ten percent of the income-producing activity sales. 3. December 31, 2015 through December 31, 2016, by the sum of the following: (a) Ninety-five percent of the market sales. (b) Five percent of the income-producing activity sales. 4. December 31, 2016 through december 31, 2025, by one hundred percent of the market sales. C. For taxable years beginning from and after December 31, 2025, sales, other than sales of tangible personal property, are in this state if the taxpayer's market for the sales is in this state. The taxpayer's market for sales is in this state as follows: 1. For the sale, rental, lease or license of real property, if and to the extent the property is located in this state. 2. For the rental, lease or license of tangible personal property, if and to the extent the property is located in this state. Except for transportation property, the location of the property is determined when the property is first placed in service by the lessee. For transportation property, the property is located in this state to the extent the property is used in this state. An aircraft is deemed to be used in this state based on a fraction, the numerator of which is the number of landings of the aircraft in this state and the denominator of which is the total number of landings of the aircraft. 3. For interest, fees and penalties in connection with loans secured by real property and the sale of the loans secured by real property, the market is in this state if the property is located in this state. The determination of real property securing a loan is made at the time of the original agreement without regard to subsequent substitutions of collateral. 4. For interest, fees and penalties in connection with loans not secured by real property and the sale of the loans not secured by real property, the market is in this state if the borrower is located in this state. 5. For interest, dividends and other income from investment and trading assets and activities, the market is in this state if the asset is properly assigned to a regular place of business of the taxpayer in this state. An asset is properly assigned to a regular place of business in this state if the trading policies or guidelines with respect to the asset or activity are established in this state. The market for the sale of the investment or trading assets is in this state if the customer is in this state. 6. For the sale of a service, if and to the extent the service is delivered to a location in this state. 7. For intangible property that is: (a) Rented, leased or licensed, if and to the extent the property is used in this state, except that intangible property used in marketing a good or service to a consumer is used in this state if that good or service is purchased by a consumer who is in this state. (b) Sold, if and to the extent the property is used in this state, except that: (i) A contract right, government license or similar intangible property that authorizes the holder to conduct a business activity in a specific geographic area is used in this state if the geographic area includes all or part of this state. (ii) Receipts from intangible property sales that are contingent on the productivity, use or disposition of the intangible property shall be treated as receipts from the rental, lease or licensing of such intangible property under subdivision (a) of this paragraph. (iii) Unless otherwise provided in this section, all other receipts from a sale of intangible property shall be excluded from the numerator and denominator of the sales factor. D. If the state or states of assignment under subsection C of this section cannot be determined, the state or states of assignment shall be reasonably approximated. E. If the taxpayer is not taxable in a state to which a receipt is assigned under subsection C or D of this section, or if the state of assignment cannot be determined under subsection C of this section or reasonably approximated under subsection D of this section, the receipt shall be excluded from the denominator of the sales factor. C. F. A multistate service provider may elect to treat sales from services as being in this state under subsection B of this section as follows: 1. The election must be made on the taxpayer's timely filed original income tax return. The election is: (a) Effective retroactively for the full taxable year of the income tax return on which the election is made. (b) Binding on the taxpayer for at least five consecutive taxable years, regardless of whether the taxpayer no longer meets the percentage threshold of a multistate service provider during that time period, except as provided by paragraph 2 of this subsection. To continue with the election after five consecutive taxable years, the taxpayer must meet the qualifications to be considered a multistate service provider and renew the election for another five consecutive taxable years. 2. During the election period, the election may be terminated as follows: (a) Without the permission of the department on the acquisition or merger of the taxpayer. (b) With the permission of the department before the expiration of five consecutive taxable years. D. G. For a multistate service provider under subsection E I, paragraph 3, subdivision (b) of this section, an election under subsection B of this section is limited to the treatment of sales for educational services. For a multistate service provider under subsection E I, paragraph 3, subdivision (c) of this section, an election under subsection B of this section is limited to the treatment of sales for support services, the payment for which is a percentage of the sales for educational services generated by a regionally accredited institution of higher education. H. The department shall adopt rules as necessary for the purposes of this section. E. I. For the purposes of this section: 1. "Income-producing activity sales" means the total sales from services that are sales in this state under subsection A of this section. 2. "Market sales" means the total sales from services and sales of from intangibles, as defined in paragraph 3, subdivision (a) of this subsection, for which the purchaser received the benefit of the service or intangibles in this state. 3. "Multistate service provider" means any of the following: (a) A taxpayer that derives more than eighty-five percent of its sales from services or sales from intangibles provided to purchasers who receive the benefit of the service or intangibles outside this state in the taxable year of election, and includes all taxpayers required to file a combined report pursuant to section 43-942 and all members of an affiliated group included in a consolidated return pursuant to section 43-947. In calculating the eighty-five percent, sales to students receiving educational services at campuses physically located in this state shall be excluded from the calculation. For the purposes of this subdivision, "sales from intangibles" means sales derived from credit and charge card receivables, including fees, merchant discounts, interchanges, interest and related revenue. (b) A taxpayer that is a regionally accredited institution of higher education with at least one university campus in this state that has more than two thousand students residing on the campus, and includes all taxpayers required to file a combined report pursuant to section 43-942 and all members of an affiliated group included in a consolidated return pursuant to section 43-947. (c) A taxpayer that has more than two thousand employees in this state and that derives more than eighty-five percent of its sales from support services provided to a regionally accredited institution of higher education, and includes all taxpayers required to file a combined report pursuant to section 43-942 and all members of an affiliated group included in a consolidated return pursuant to section 43-947. 4. "Received the benefit of the service in this state" means the services are received by the purchaser in this state. If the state where the services are received cannot be readily determined, the services are considered to be received at the home of the customer or, in the case of a business, the office of the customer from which the services were ordered in the regular course of the customer's trade or business. If the ordering location cannot be determined, the services are considered to be received at the home or office of the customer to which the services were billed. In the case of a multistate service provider under paragraph 3, subdivision (c) of this subsection, the benefit of support services shall be deemed received at the billing address of the student to which the services relate. 5. "Sales for educational services" means tuition and fees required for enrollment and fees required for courses of instruction, transcripts and graduation. END_STATUTE |
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| 80 | 80 | | Be it enacted by the Legislature of the State of Arizona: |
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| 82 | 82 | | Section 1. Section 43-1139, Arizona Revised Statutes, is amended to read: |
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| 83 | 83 | | |
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| 84 | 84 | | START_STATUTE43-1139. Allocation of business income |
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| 85 | 85 | | |
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| 86 | 86 | | A. Except as provided in subsection B of this section, the taxpayer shall elect to apportion all business income to this state for taxable years beginning from and after: |
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| 88 | 88 | | 1. December 31, 2006 through December 31, 2007 by either: |
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| 89 | 89 | | |
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| 90 | 90 | | (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. |
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| 91 | 91 | | |
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| 92 | 92 | | (b) Multiplying the income by a fraction, the numerator of which is two times the property factor plus two times the payroll factor plus six times the sales factor, and the denominator of which is ten. |
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| 94 | 94 | | 2. December 31, 2007 through December 31, 2008 by either: |
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| 96 | 96 | | (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. |
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| 97 | 97 | | |
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| 98 | 98 | | (b) Multiplying the income by a fraction, the numerator of which is one and one-half times the property factor plus one and one-half times the payroll factor plus seven times the sales factor, and the denominator of which is ten. |
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| 100 | 100 | | 3. December 31, 2008 through December 31, 2013 by either: |
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| 102 | 102 | | (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. |
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| 104 | 104 | | (b) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus eight times the sales factor, and the denominator of which is ten. |
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| 106 | 106 | | 4. December 31, 2013 through December 31, 2014 by either: |
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| 108 | 108 | | (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. |
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| 110 | 110 | | (b) Multiplying the income by a fraction, the numerator of which is seven and one-half times the property factor plus seven and one-half times the payroll factor plus eighty-five times the sales factor, and the denominator of which is one hundred. |
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| 112 | 112 | | 5. December 31, 2014 through December 31, 2015 by either: |
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| 114 | 114 | | (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. |
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| 116 | 116 | | (b) Multiplying the income by a fraction, the numerator of which is five times the property factor plus five times the payroll factor plus ninety times the sales factor, and the denominator of which is one hundred. |
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| 118 | 118 | | 6. December 31, 2015 through December 31, 2016 by either: |
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| 120 | 120 | | (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. |
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| 121 | 121 | | |
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| 122 | 122 | | (b) Multiplying the income by a fraction, the numerator of which is two and one-half times the property factor plus two and one-half times the payroll factor plus ninety-five times the sales factor, and the denominator of which is one hundred. |
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| 124 | 124 | | 7. December 31, 2016 through December 31, 2025 by either: |
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| 126 | 126 | | (a) Multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. |
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| 127 | 127 | | |
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| 128 | 128 | | (b) Multiplying the income by the sales factor. |
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| 130 | 130 | | 8. December 31, 2025 by multiplying the income by a fraction, the numerator of which is the property factor plus the payroll factor plus two times the sales factor, and the denominator of which is four. |
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| 132 | 132 | | B. All business income of a taxpayer engaged in air commerce shall be apportioned to this state by multiplying the income by a fraction, the numerator of which is the revenue aircraft miles flown within this state for flights beginning or ending in this state and the denominator of which is the total revenue aircraft miles flown by the taxpayer's aircraft everywhere. This subsection applies to each taxpayer, including a combined group filing a combined return or an affiliated group electing to file a consolidated return under section 43-947, if fifty per cent percent or more of that taxpayer's gross income is derived from air commerce. For the purposes of this subsection: |
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| 134 | 134 | | 1. "Air commerce" means transporting persons or property for hire by aircraft in interstate, intrastate or international transportation. |
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| 136 | 136 | | 2. "Revenue aircraft miles flown" has the same meaning prescribed by the United States department of transportation uniform system of accounts and reports for large certificated air carriers (14 Code of Federal Regulations part 241). END_STATUTE |
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| 138 | 138 | | Sec. 2. Section 43-1147, Arizona Revised Statutes, is amended to read: |
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| 140 | 140 | | START_STATUTE43-1147. Situs of sales of other than tangible personal property; rules; definitions |
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| 142 | 142 | | A. For taxable years beginning before December 31, 2025, except as provided by subsection B of this section, sales, other than sales of tangible personal property, are in this state if either of the following applies: |
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| 144 | 144 | | 1. The income-producing activity is performed in this state. |
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| 146 | 146 | | 2. The income-producing activity is performed both in and outside this state and a greater proportion of the income-producing activity is performed in this state than in any other state, based on costs of performance. |
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| 147 | 147 | | |
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| 148 | 148 | | B. For taxable years beginning from and after December 31, 2013 through December 31, 2025, a multistate service provider may elect to treat sales from services as being in this state based on a combination of income-producing activity sales and market sales. If the election under this subsection is made pursuant to subsection C F of this section, the sales of services that are in this state shall be determined for taxable years beginning from and after: |
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| 149 | 149 | | |
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| 150 | 150 | | 1. December 31, 2013 through December 31, 2014, by the sum of the following: |
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| 151 | 151 | | |
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| 152 | 152 | | (a) Eighty-five percent of the market sales. |
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| 153 | 153 | | |
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| 154 | 154 | | (b) Fifteen percent of the income-producing activity sales. |
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| 155 | 155 | | |
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| 156 | 156 | | 2. December 31, 2014 through December 31, 2015, by the sum of the following: |
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| 157 | 157 | | |
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| 158 | 158 | | (a) Ninety percent of the market sales. |
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| 159 | 159 | | |
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| 160 | 160 | | (b) Ten percent of the income-producing activity sales. |
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| 161 | 161 | | |
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| 162 | 162 | | 3. December 31, 2015 through December 31, 2016, by the sum of the following: |
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| 163 | 163 | | |
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| 164 | 164 | | (a) Ninety-five percent of the market sales. |
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| 166 | 166 | | (b) Five percent of the income-producing activity sales. |
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| 168 | 168 | | 4. December 31, 2016 through december 31, 2025, by one hundred percent of the market sales. |
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| 169 | 169 | | |
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| 170 | 170 | | C. For taxable years beginning from and after December 31, 2025, sales, other than sales of tangible personal property, are in this state if the taxpayer's market for the sales is in this state. The taxpayer's market for sales is in this state as follows: |
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| 171 | 171 | | |
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| 172 | 172 | | 1. For the sale, rental, lease or license of real property, if and to the extent the property is located in this state. |
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| 173 | 173 | | |
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| 174 | 174 | | 2. For the rental, lease or license of tangible personal property, if and to the extent the property is located in this state. Except for transportation property, the location of the property is determined when the property is first placed in service by the lessee. For transportation property, the property is located in this state to the extent the property is used in this state. An aircraft is deemed to be used in this state based on a fraction, the numerator of which is the number of landings of the aircraft in this state and the denominator of which is the total number of landings of the aircraft. |
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| 175 | 175 | | |
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| 176 | 176 | | 3. For interest, fees and penalties in connection with loans secured by real property and the sale of the loans secured by real property, the market is in this state if the property is located in this state. The determination of real property securing a loan is made at the time of the original agreement without regard to subsequent substitutions of collateral. |
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| 177 | 177 | | |
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| 178 | 178 | | 4. For interest, fees and penalties in connection with loans not secured by real property and the sale of the loans not secured by real property, the market is in this state if the borrower is located in this state. |
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| 179 | 179 | | |
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| 180 | 180 | | 5. For interest, dividends and other income from investment and trading assets and activities, the market is in this state if the asset is properly assigned to a regular place of business of the taxpayer in this state. An asset is properly assigned to a regular place of business in this state if the trading policies or guidelines with respect to the asset or activity are established in this state. The market for the sale of the investment or trading assets is in this state if the customer is in this state. |
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| 181 | 181 | | |
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| 182 | 182 | | 6. For the sale of a service, if and to the extent the service is delivered to a location in this state. |
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| 183 | 183 | | |
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| 184 | 184 | | 7. For intangible property that is: |
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| 185 | 185 | | |
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| 186 | 186 | | (a) Rented, leased or licensed, if and to the extent the property is used in this state, except that intangible property used in marketing a good or service to a consumer is used in this state if that good or service is purchased by a consumer who is in this state. |
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| 188 | 188 | | (b) Sold, if and to the extent the property is used in this state, except that: |
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| 189 | 189 | | |
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| 190 | 190 | | (i) A contract right, government license or similar intangible property that authorizes the holder to conduct a business activity in a specific geographic area is used in this state if the geographic area includes all or part of this state. |
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| 191 | 191 | | |
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| 192 | 192 | | (ii) Receipts from intangible property sales that are contingent on the productivity, use or disposition of the intangible property shall be treated as receipts from the rental, lease or licensing of such intangible property under subdivision (a) of this paragraph. |
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| 193 | 193 | | |
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| 194 | 194 | | (iii) Unless otherwise provided in this section, all other receipts from a sale of intangible property shall be excluded from the numerator and denominator of the sales factor. |
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| 195 | 195 | | |
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| 196 | 196 | | D. If the state or states of assignment under subsection C of this section cannot be determined, the state or states of assignment shall be reasonably approximated. |
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| 197 | 197 | | |
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| 198 | 198 | | E. If the taxpayer is not taxable in a state to which a receipt is assigned under subsection C or D of this section, or if the state of assignment cannot be determined under subsection C of this section or reasonably approximated under subsection D of this section, the receipt shall be excluded from the denominator of the sales factor. |
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| 199 | 199 | | |
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| 200 | 200 | | C. F. A multistate service provider may elect to treat sales from services as being in this state under subsection B of this section as follows: |
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| 201 | 201 | | |
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| 202 | 202 | | 1. The election must be made on the taxpayer's timely filed original income tax return. The election is: |
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| 203 | 203 | | |
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| 204 | 204 | | (a) Effective retroactively for the full taxable year of the income tax return on which the election is made. |
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| 205 | 205 | | |
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| 206 | 206 | | (b) Binding on the taxpayer for at least five consecutive taxable years, regardless of whether the taxpayer no longer meets the percentage threshold of a multistate service provider during that time period, except as provided by paragraph 2 of this subsection. To continue with the election after five consecutive taxable years, the taxpayer must meet the qualifications to be considered a multistate service provider and renew the election for another five consecutive taxable years. |
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| 207 | 207 | | |
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| 208 | 208 | | 2. During the election period, the election may be terminated as follows: |
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| 209 | 209 | | |
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| 210 | 210 | | (a) Without the permission of the department on the acquisition or merger of the taxpayer. |
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| 211 | 211 | | |
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| 212 | 212 | | (b) With the permission of the department before the expiration of five consecutive taxable years. |
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| 213 | 213 | | |
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| 214 | 214 | | D. G. For a multistate service provider under subsection E I, paragraph 3, subdivision (b) of this section, an election under subsection B of this section is limited to the treatment of sales for educational services. For a multistate service provider under subsection E I, paragraph 3, subdivision (c) of this section, an election under subsection B of this section is limited to the treatment of sales for support services, the payment for which is a percentage of the sales for educational services generated by a regionally accredited institution of higher education. |
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| 215 | 215 | | |
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| 216 | 216 | | H. The department shall adopt rules as necessary for the purposes of this section. |
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| 217 | 217 | | |
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| 218 | 218 | | E. I. For the purposes of this section: |
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| 219 | 219 | | |
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| 220 | 220 | | 1. "Income-producing activity sales" means the total sales from services that are sales in this state under subsection A of this section. |
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| 221 | 221 | | |
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| 222 | 222 | | 2. "Market sales" means the total sales from services and sales of from intangibles, as defined in paragraph 3, subdivision (a) of this subsection, for which the purchaser received the benefit of the service or intangibles in this state. |
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| 223 | 223 | | |
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| 224 | 224 | | 3. "Multistate service provider" means any of the following: |
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| 225 | 225 | | |
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| 226 | 226 | | (a) A taxpayer that derives more than eighty-five percent of its sales from services or sales from intangibles provided to purchasers who receive the benefit of the service or intangibles outside this state in the taxable year of election, and includes all taxpayers required to file a combined report pursuant to section 43-942 and all members of an affiliated group included in a consolidated return pursuant to section 43-947. In calculating the eighty-five percent, sales to students receiving educational services at campuses physically located in this state shall be excluded from the calculation. For the purposes of this subdivision, "sales from intangibles" means sales derived from credit and charge card receivables, including fees, merchant discounts, interchanges, interest and related revenue. |
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| 227 | 227 | | |
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| 228 | 228 | | (b) A taxpayer that is a regionally accredited institution of higher education with at least one university campus in this state that has more than two thousand students residing on the campus, and includes all taxpayers required to file a combined report pursuant to section 43-942 and all members of an affiliated group included in a consolidated return pursuant to section 43-947. |
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| 229 | 229 | | |
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| 230 | 230 | | (c) A taxpayer that has more than two thousand employees in this state and that derives more than eighty-five percent of its sales from support services provided to a regionally accredited institution of higher education, and includes all taxpayers required to file a combined report pursuant to section 43-942 and all members of an affiliated group included in a consolidated return pursuant to section 43-947. |
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| 231 | 231 | | |
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| 232 | 232 | | 4. "Received the benefit of the service in this state" means the services are received by the purchaser in this state. If the state where the services are received cannot be readily determined, the services are considered to be received at the home of the customer or, in the case of a business, the office of the customer from which the services were ordered in the regular course of the customer's trade or business. If the ordering location cannot be determined, the services are considered to be received at the home or office of the customer to which the services were billed. In the case of a multistate service provider under paragraph 3, subdivision (c) of this subsection, the benefit of support services shall be deemed received at the billing address of the student to which the services relate. |
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| 233 | 233 | | |
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| 234 | 234 | | 5. "Sales for educational services" means tuition and fees required for enrollment and fees required for courses of instruction, transcripts and graduation. END_STATUTE |
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