Title 15 . Revenue

Chapter 19 . (Repealed)

Section 111. When a taxpayer is "subject to" a tax

15 AAC 19.111. When a taxpayer is "subject to" a tax

(a) A taxpayer is "subject to" one of the taxes specified in 15 AAC 19.101(a) if it carries on business activity in that state and that state imposes such a tax on that activity. Any taxpayer which asserts that it is subject to one of the taxes specified in 15 AAC 19.101(a) in another state shall furnish to the commissioner of revenue of this state upon his request evidence to support the assertion. The commissioner of revenue may request that the evidence include proof that the taxpayer has filed the requisite tax return in the other state and has paid any taxes imposed under the law of that other state; the taxpayer's failure to produce that proof may be taken into account in determining whether the taxpayer in fact is subject to one of the taxes specified in AS 43.19.010 , Article IV.3.(1) and 15 AAC 19.101(a) in the other state.

(b) If the taxpayer voluntarily files and pays one or more of those taxes when not required to do so by the laws of that state or pays a minimal fee for qualification, organization or for the privilege of doing business in that state, but (1) does not actually engage in business activity in that state, or (2) does actually engage in some business activity, not sufficient for nexus, and the minimum tax bears no relation to the taxpayer's business activity within such state, the taxpayer is not "subject to" one of the taxes specified in AS 43.19.010 , Article IV.3.(1) and 15 AAC 19.101(a) .

(c) The concept of taxability in another state is based on the premise that every state in which the taxpayer is engaged in business activity may impose an income tax even though every state does not do so. In states which do not, other types of taxes may be imposed as a substitute for an income tax. Therefore, only those taxes enumerated in AS 43.19.010 , Article IV.3.(1) and 15 AAC 19.101(a) which may be considered as basically revenue-raising rather than regulatory measures shall be considered in determining whether the taxpayer is "subject to" one of the taxes specified in AS 43.19.010 , Article IV.3.(1) and 15 AAC 19.101(a) in another state.

History: Eff. 5/24/78, Register 66; am 3/31/82, Register 81

Authority: AS 43.05.080

AS 43.19.010