State and Local Tax (SALT) attorneys Bruce Ely and James Long were quoted in State Tax Notes regarding their objection to the pre-clearance requirement for alternative apportionment. At a public hearing held February 11, Ely and Long urged the Alabama Department of Revenue to remove the requirement from a proposed rule reflecting the state’s adopted version of the Multistate Tax Compact. The provision in the rule would require taxpayers to submit a request for alternative apportionment at least six months before the due date of their return.
“As a result, taxpayers will not be able to study and assess the need for alternative apportionment if a return has already been filed or if it is within the six-month window prior to the date of the return,” Ely and Long said.
Ely and Long also urged the department to delete a provision in the rule that would give the commissioner of revenue discretionary authority to adjust a company’s payroll factor to prevent distortion from payments for intercompany services.