Idaho Admin. Code r. 35.01.01.325 - DEFINITIONS FOR PURPOSES OF MULTISTATE RULES

Section 63-3027, Idaho Code. For purposes of computing the Idaho taxable income of a multistate corporation, the following definitions apply: (4-6-23)

01. Affiliated Corporation and Affiliated Group. An affiliated corporation is a corporation that is a member of a commonly controlled group of which the taxpayer is also a member. The commonly controlled group is referred to as an affiliated group. Although Idaho generally follows federal tax principles and terminology, Idaho's use of the terms affiliated corporation and affiliated group means a corporation or corporations with over fifty percent (50%) of its voting stock directly or indirectly owned or controlled by a common owner or owners. For information on what constitutes common control, see Rule 344 of these rules. (4-6-23)

02. Allocation. Allocation refers to the assignment of nonapportionable income to a particular state. (4-6-23)

03. Apportionment. Apportionment refers to the division of apportionable income between states in which the business is conducted by the use of a formula containing apportionment factors. (4-6-23)

04. Business Activity. Business activity refers to the transactions and activity occurring in the regular course of a particular trade or business of a taxpayer or to the acquisition, management, and disposition of property that constitute integral parts of the taxpayer's regular trade or business operations. (4-6-23)

05. Combined Group. Combined group means the group of corporations that comprise a unitary business and are includable in a combined report pursuant to Section 63-3027(22) or 63-3027B, Idaho Code, if the water's edge election is made. (4-6-23)

06. Combined Report. Combined report refers to the computational filing method to be used by a unitary business which is conducted by a group of corporations wherever incorporated rather than a single corporation. (4-6-23)

07. Gross Receipts. (4-6-23)

a. Gross receipts are the gross amounts realized, (the sum of money and the fair market value of other property or services received) on the sale or exchange of property, the performance of services, or the use of property or capital (including rents, royalties, interest and dividends) in a transaction that produces apportionable income, in which the income or loss is recognized (or would be recognized if the transaction were in the United States) under the Internal Revenue Code. Amounts realized on the sale or exchange of property are not reduced for the cost of goods sold or the basis of property sold. Gross receipts, even if apportionable income, do not include such items as, for example: (4-6-23)

i. Repayment, maturity, or redemption of the principal of a loan, bond, or mutual fund or certificate of deposit or similar marketable instrument; (4-6-23)

ii. The principal amount received under a repurchase agreement or other transaction properly characterized as a loan; (4-6-23)

iii. Proceeds from issuance of the taxpayer's own stock or from sale of treasury stock; (4-6-23)

iv. Damages and other amounts received as the result of litigation; (4-6-23)

v. Property acquired by an agent on behalf of another; (4-6-23)

vi. Tax refunds and other tax benefit recoveries; (4-6-23)

vii. Pension reversions; (4-6-23)

viii. Contributions to capital; (4-6-23)

ix. Income from forgiveness of indebtedness; or (4-6-23)

x. Amounts realized from exchanges of inventory that are not recognized by the Internal Revenue Code. (4-6-23)

b. Exclusion of an item from the definition of gross receipts is not determinative of its character as apportionable or nonapportionable income. Nothing in this definition is to be construed to modify, impair or supersede any provision of Rules 560 through 595 of these rules. (4-6-23)

08. Group Return. A unitary group of corporations may file one (1) Idaho corporate income tax return for all the corporations of the unitary group that are required to file an Idaho income tax return. When used in these rules, group return refers to this sole return filed by a unitary group. Use of the group return precludes the need for each corporation to file its own Idaho corporate income tax return. (4-6-23)

09. MTC. The Multistate Tax Commission. (4-6-23)

10. Multistate Corporation. A multistate corporation is a corporation that operates in more than one (1) state. For purposes of this definition, state is defined in Section 63-3027(1)(j), Idaho Code. (4-6-23)

11. Unitary Business. Unitary business is a concept of constitutional law defined in decisions of the United States Supreme Court. See Rule 340 of these rules. (4-6-23)

Notes

Idaho Admin. Code r. 35.01.01.325