Revised PA bill adds new economic nexus tax guidelines
The Keystone State has officially updated its tax law with provisions on economic nexus that you’ll need to know if you do business in Pennsylvania.
Effective for tax years beginning after Dec. 31, 2022, any business with $500,000 or more in sales that can be sourced to Pennsylvania has created nexus for tax purposes.
The update, implemented by revisions to HB 1342, also provides a more comprehensive definition of what it takes to establish nexus in the state. Any entity that conducts “business activity” in the state will be subject to tax guidelines.
Per the bill, “business activity” will include:
- the leasing or licensing of intangible property used in the state
- engaging in transactions involving intangible property with customers located in Pennsylvania (including loan transactions), and
- sales of intangible property used by a corporation within the state.
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