Taxation Law in Missouri

John P. Barrie, Esquire

Income Tax – Sale of intangibles by non-Missouri seller to non-Missouri buyer not income from a Missouri source.  Watkins Motor Lines, Inc. v. Director of Revenue, No. 10-1418 RI (Mo. AHC, September 27, 2013) C. Teer

Taxpayer, a Florida corporation doing business in Missouri and other states, sold its business, including the sale of its intangibles (good will, customer lists, software, etc.), to a buyer who was also not domiciled in Missouri.  The director determined that the gain should be taxed based on the apportionment formula applied to all of the taxpayer’s income.

Director’s determination reversed.  The commission found that because the sale was between non-Missouri domiciled corporations, the gain is treated as non-Missouri source even though the taxpayer was engaged in business in Missouri.