Text: HSB00537 Text: HSB00539 Text: HSB00500 - HSB00599 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 Section 1. NEW SECTION. 422.34A EXEMPT ACTIVITIES OF 1 2 FOREIGN CORPORATIONS. 1 3 A foreign corporation shall not be considered doing 1 4 business in this state or deriving income from sources within 1 5 this state for the purposes of this division by reason of 1 6 carrying on in this state one or more of the following 1 7 activities: 1 8 1. Holding meetings of the board of directors or 1 9 shareholders or carrying on other activities concerning 1 10 internal corporate affairs. 1 11 2. Maintaining bank accounts. 1 12 3. Borrowing money, with or without security. 1 13 4. Securing or collecting debts or enforcing any rights in 1 14 property securing the debts. 1 15 5. Maintaining, defending, or settling any proceeding. 1 16 6. Owning and controlling a subsidiary corporation 1 17 incorporated in or transacting business within this state. 1 18 7. Recruiting personnel where hiring occurs outside the 1 19 state. 1 20 8. Utilizing an independent contractor to perform work 1 21 under a warranty or similar arrangement. 1 22 9. Displaying for sale or selling tangible personal 1 23 property on an occasional basis at trade shows, fairs, 1 24 exhibitions, or similar temporary events in this state. 1 25 Sec. 2. This Act, being deemed of immediate importance, 1 26 take effect upon enactment and applies retroactively to 1 27 January 1, 1996, for tax years beginning on or after that 1 28 date. 1 29 EXPLANATION 1 30 Federal law restricts the state taxation of business income 1 31 derived within the state from interstate commerce if the only 1 32 business activity within the state is the solicitation of 1 33 sales or the activities are ancillary to the solicitation of 1 34 sales. In addition, if the business activities are not 1 35 related to the solicitation of sales but are very meager in 2 1 effect then state taxation is also restricted. This bill 2 2 lists certain business activities which a foreign corporation 2 3 may carry on without being considered as doing business in the 2 4 state or deriving income from sources within the state. 2 5 The bill takes effect upon enactment and applies 2 6 retroactively to January 1, 1996, for tax years beginning on 2 7 or after that date. 2 8 LSB 3616YC 76 2 9 mg/jj/8
Text: HSB00537 Text: HSB00539 Text: HSB00500 - HSB00599 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
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