Demystifying the Sales Factor: Foreign Receipts


Catherine Battin, Maria Eberle, and Lindsay LaCava wrote this bylined article to examine how states treat receipts from foreign countries when calculating the sales factor. “There is a lack of authority in many states regarding the treatment of foreign receipts in the sales factor,” the authors wrote. “As is typical in the area of state taxation, this lack of authority can lead to significant opportunities but may also present traps if taxpayers lack sufficient documentation to support their filing positions.”