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Arkansas
Multistate Businesses – the current “throwback rule” will be phased out over seven years beginning in 2024. This rule is used to determine the apportionment of business income by multistate businesses for income tax purposes. Currently, multistate businesses conducting business in Arkansas pay taxes to the state on 100% of their profits. Companies that also pay taxes in other states may end up being taxed additionally on the same income. The phase out will start in 2024 with sales sourced 85.71% within Arkansas and 14.29% outside the state, with the ultimate goal of 100% of sales sourced outside the state beginning in 2030.
Sales of Tangible Personal Property – Currently, sales of tangible personal property are taxable in Arkansas if the property is delivered or shipped to a purchaser in the state. However, there is an exception for purchases made by the federal government. Beginning in 2024, this exception will be eliminated.
Mississippi
Effective 7/1/23, the state will provide a 50% income tax credit for any employer providing a child care stipend of at least $6,000 to a licensed or registered entity providing dependent child care in Mississippi for an employee’s children during the employee’s work hours. (House Bill 1734, approved by Governor 4/19/23)
Nevada
Occasional Sales – The state has provided sales tax guidance for “occasional sales”. Normally, purchases of tangible personal property, including assets, are subject to Nevada sales or use tax when purchased for storage, use or consumption in Nevada. However, there’s an exception for occasional sales. If an owner makes no more than two sales in a 12-month period, they qualify as “occasional sales”. This can even include a business selling all of its assets in a single transaction or an owner selling all assets to a single purchaser in one transaction. However, if a third sale occurs during the 12-month period, the first two sales no longer qualify as occasional sales and all three sales become taxable.
New Mexico
Pass-Through Entities – New Mexico joins other states in allowing income for pass-through entities to be taxed at the entity level rather than the ownership level. Owners will receive a credit for taxes paid on their behalf by the entity.
Tax Rebates – Effective April 1, all New Mexico residents who filed state tax returns for tax year 2021 will receive a tax rebate. Taxpayers filing as single or married filing separately will receive $500. Taxpayers who are married filing jointly, heads of households, and surviving spouses will receive $1,000.
Child Income Tax Credit – This credit will be increased to provide an increased credit of up to $600 depending on income levels.
North Carolina
Tax Technical Corrections – The state made technical changes effective January 1, 2023, including:
- Updated the state’s conformity with the Internal Revenue Code for corporate and personal income taxes to 1/1/23 (previously 4/1/21).
- Multi-state sole proprietorships must follow the same rules as multi-state corporations for dividing income among states.
- Income tax credits paid to other states by individuals are not refundable.
- The list of penalties waived in case of a presidentially declared disaster has been expanded to include the penalty for failure to file an information return.
- The current administrative provisions for determining when utensils are provided by the retailer has been codified.
- The Streamlined Sales and Use Tax Agreement has been updated to December 22, 2022, from the previous date of December 21, 2021.
Tax Collections – The North Carolina Department of Revenue has a 10-year statute of limitations on tax collections.
North Dakota
The state has made changes to its income tax credit for employing individuals with developmental disabilities or severe mental illness. Beginning in 2023, the credit is increased from 5% to 25% up to $6,000 in wages paid during the first 12 months of employment. For more information, see the state’s website by clicking here.
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