Is Social Media Tax Worth a Follow?

The City of Chicago’s widely reported first-of-its-kind Social Media Amusement Tax (the Chicago SMAT) went into effect on January 1, 2026, promising to deliver tens of millions of dollars of additional revenue to the City. Whether the Chicago SMAT will actually deliver on that revenue promise is questionable, however, as its implementation and legality remain uncertain.

Chicago SMAT’s Attempt at Defining the Population
Is Administratively and Legally Problematic

The Chicago SMAT relies on a broadly defined tax base of Chicago consumers that appears positioned to over-capture users in Chicago[1] and may trigger the same due process problem that defeated the City a decade ago in Personal Property Lease Transaction Tax litigation over vehicle rentals.[2] The Chicago SMAT may also raise Dormant Commerce Clause concerns on account of the difficulty in fairly apportioning the tax.

The definition of Chicago residents utilized in the Chicago SMAT is ambiguous, particularly when it comes to commuters and temporary visitors. Further, in order for a social media business to determine which of its users are covered under the Chicago SMAT, the social media business would likely have to alter its data collection practices, despite the ordinance specifically asserting that the business is not expected to do so. From a practical perspective, if such changes are not made, a social media business may not be in a position to accurately report to the City.

These administrative challenges make implementation of the Chicago SMAT difficult, raise constitutional questions, and may impact the effectiveness of the tax as a revenue source.

Chicago SMAT May Violate the Internet Tax Freedom Act

Further, the SMAT may be subject to challenge under the Internet Tax Freedom Act, which prohibits discriminatory taxes on electronic commerce.^[3] While the City successfully defended a previous extension of its Amusement Tax to streaming services such as Netflix and Spotify, it did so on the basis that the same content is subject to sales taxes when delivered in a physical format.[4] A court may not necessarily reach the same conclusion for the SMAT, as social media is solely a creature of the Internet for which no physical analog exists.

Illinois Proposes to Follow Chicago’s Lead

Against that backdrop, and despite the almost certainty of ensuing legal challenges to the Chicago SMAT, Illinois Governor J.B. Pritzker’s fiscal year 2027 budget proposal includes a similar Social Media Digital Platform Fee (SMP Fee) projected to raise $200 million of new revenue. Under Governor Pritzker’s proposal, technology companies that operate social media platforms would pay a monthly charge based on the number of monthly active Illinois users or accounts from whom they collect data.

The SMP Fee would operate with a tiered rate structure ranging from $0.10 per user per month for social medial platforms with more than 100,000 monthly active Illinois users to a top marginal rate of $0.50 per user per month for monthly active Illinois users above 1 million. Like the Chicago SMAT, Governor Pritzker’s proposal would prohibit social media platforms from directly or indirectly passing the SMP Fee along to their Illinois users.

The SMP Fee shares the SMAT’s promises of generating substantial recurring annual revenues, as well as its core practical and legal issues. From a practical perspective, it is difficult to define an active Illinois user; prove user location with sufficient precision; and police no-pass-through rules. Legally, the Commerce Clause, Due Process Clause, and Internet Tax Freedom Act each pose formidable hurdles.

Illinois appears to be doubling down on a policy experiment before the Chicago SMAT has even been tested. There are still more questions than answers regarding the Chicago SMAT, including the two principal questions: can a per-user social media levy be administered reliably, and will courts permit it to stand?

The Chicago SMAT, much like Maryland’s Digital Advertising Tax when it was first enacted, will likely serve as a test case, and other state and local legislatures will be watching carefully to see how it fares under scrutiny. But until the Chicago SMAT survives both administration and litigation hurdles, Illinois would be wise to be conservative in its budgetary projections from its SMP Fee.

[1] Municipal Code of Chicago § 4-156-1010.

[2] Hertz Corp. v. City of Chicago, 77 N.E. 3d 606 (Ill. 2017).

[3] 47 U.S.C. § 151 note.

[4] Labell v. City of Chicago, 147 N.E. 3d 732 (Ill. App. 2019).

Massachusetts’ Latest Attack on P.L. 86-272

By Stefi George and David Blum on October 28, 2025 Posted in Massachusetts, Nexus

Massachusetts is the latest state to attempt to narrow the scope of Federal law P.L. 86-272. On October 10, the Commonwealth issued final regulations targeted at cookies placed on computers or other electronic devices of in-state customers, as well as post-sale activities.

The regulation, 830 CMR 63.39.1, provides that if a business has more than $500,000 in annual sales in Massachusetts, the mere placement of internet cookies on in-state customers’ computers or other electronic devices may demonstrate more than ancillary activities sufficient to eviscerate P.L. 86-272 protections. Specifically, the regulation provides that the use of cookies will go beyond the protections of P.L. 86-272 if such cookies “gather customer search information used to adjust production schedules and inventory amounts, develop new products, or identify new items to offer for sale.” The regulation further provides, citing Wisconsin Department of Revenue v. William Wrigley, Jr., that post-sale activities will generally not be considered entirely ancillary to solicitation.

In enacting this rule as a formal regulation, the state aimed to avoid the pitfalls other states have experienced. For instance, in California informal guidance was invalidated by the court in American Catalog Mailers Association v. Franchise Tax Board, and in New York retroactive application of its rule was struck down by the court in American Catalog Mailers Association v. Department of Taxation and Finance. Massachusetts also appears to have aimed to strike a balance in the regulation by imposing a minimum threshold of sales before the cookies or post-sale activities will trigger tax obligations.

It remains to be seen whether this middle-ground approach will be sufficient for Massachusetts. While following its rule-making procedures may help the Commonwealth avoid a claim under the Administrative Procedures Act, and the prospective nature of the regulation avoids any retroactivity claim, the regulations may nonetheless be subject to challenge, for several reasons. First, it is not clear under what authority Massachusetts can enact a regulation interpreting a federal statute, nor limit a federal statute preempting state law. Ultimately, resolution may require action by Congress to amend the Federal statute. Second, even if this regulation were deemed valid, the regulation oversimplifies where a “cookie” (i.e., a string of code) may reside. A cookie may be on a server or in the cloud and not actually on the device itself, making the location difficult, if not impossible, to know.

Courts have previously rejected the Massachusetts Department of Revenue’s argument, in the pre-Wayfair sales tax context, that cookies give rise to physical presence nexus, in U.S. Auto Parts Network Inc. v. Commissioner of Revenue. This regulation could offer the courts an opportunity to revisit the issue in the income tax context. Properly identifying what the use of cookies means for an out-of-state business is critically important for a business trying to understand its tax obligations in the state.

Not-So-Sweet Home: Alabama Lawsuit Risks Constitutional Challenges to the State’s Sales/Use Tax Regime

By Michael Bowen and Akerman Law on August 25, 2025 Posted in Alabama, Sales Tax, Use Tax

In mid-August, Alabama cities and a school district (“localities”) sued the commissioner of the Alabama Department of Revenue seeking, in essence, to “de-simplify” the state’s sales and use tax system.[1] The localities claim the “why” of their case is the millions of dollars in tax revenue they are losing every year under the current system. While the localities may view a revenue boost as a potential reward, the risks may be far more significant. If the localities prevail, the state’s home rule sales/use tax scheme is at higher risk of being found violative of the U.S. Constitution by a court of law.

Alabama is one of a handful of states (including Louisiana and Colorado) that authorizes home rule jurisdictions, permitting municipalities to impose, administer, and enforce their own sales/use taxes, separate and apart from sales/use taxes imposed at the state level. Home rule jurisdictions often present myriad compliance challenges to remote sellers, including the obligation to file voluminous returns as opposed to a single return filed at the state level and nonuniformity as it relates to tax ordinances, as local ordinances can have different tax types, tax bases, exemptions, and rates. Moreover, taxpayers are subject to audit and differing interpretations by the various taxing jurisdictions.

To streamline and simplify its cumbersome home rule system, Alabama permits certain remote taxpayers to file a single combined state and local sales and use tax return with only the state. Alabama’s Simplified Seller’s Use Tax (SSUT) program pre-dates Wayfair[2] and authorizes out-of-state sellers that exceed the state’s economic nexus thresholds to collect and remit a flat 8% sellers use tax on all sales made to Alabama customers, regardless of where delivered. Alabama’s program centralizes and simplifies local tax compliance for remote sellers and marketplace facilitators and thus mitigates undue burdens and discrimination concerns affecting interstate commerce.

The localities’ lawsuit, however, seeks to shrink the pool of taxpayers eligible to participate in the SSUT program. Specifically, the complaint claims the existing program and the commissioner’s implementation run afoul of the state constitution and the law itself. More fundamentally, and at the heart of the lawsuit’s “why,” the localities believe that Wayfair expands their authority and allows them to impose and administer their taxes on certain sellers/facilitators that participate in the SSUT program.

Despite the localities’ claims, Wayfair does not give home rule jurisdictions carte blanche to enforce their tax reporting and collection obligations. While Wayfair upheld the validity of South Dakota’s law requiring tax collection when specific dollar or transaction thresholds are met, the Court premised its holding on important guardrails, including the state’s adoption of the Streamlined Sales and Use Tax Agreement (SSUTA) that kept sales tax compliance from being overly burdensome for remote retailers. Wayfair repeatedly emphasized South Dakota’s adoption of the SSUTA, which requires a single state-level administration, simplified rates, and uniform definitions, features mirrored by Alabama’s SSUT program. The Court observed that these streamlined features of a state tax system are designed to mitigate against discrimination and undue burdens on interstate commerce in accord with the Commerce Clause of the U.S. Constitution.

In fact, following Wayfair, across the country taxpayers have been actively litigating against states’ and localities’ unconstitutional overreach with respect to taxation of remote sellers. In Louisiana and Colorado (other states like Alabama with home rule jurisdictions), remote sellers have challenged state and local tax obligations on constitutional grounds, including undue burden and discrimination. In Colorado, Wayfair LLC sued the City of Lakewood over its complex sales tax reporting requirements and alleged that the City’s decentralized sales tax system unconstitutionally violated the company’s right to engage in interstate commerce, a direct violation of the Commerce Clause.[3] Similarly, an Arizona-based online business filed a lawsuit in federal court in the Eastern District of Louisiana, alleging that Louisiana’s decentralized sales tax system and lack of uniformity present undue compliance burdens for remote sellers under Wayfair.[4] And in Illinois, multiple pending lawsuits against the state are challenging the hybrid sourcing regime created by the state’s Leveling the Playing Field law on grounds that the law discriminates against and imposes due burden on remote sellers in violation of the federal Commerce Clause and Uniformity Clause of the Illinois Constitution.

Across the country, remote sellers have demonstrated a willingness to litigate against state and local tax regimes that unfairly discriminate against and impose undue compliance burdens on them contrary to the U.S. Constitution. Will Alabama face the same fate? Stay tuned, as the localities’ litigation against the commissioner is poised to be a determinative factor.

[1] City of Tuscaloosa v. Barnett, No. 03-CV-2025-901301.00 (Cir. Ct. of Montgomery County, Ala.) (complaint filed Aug. 12, 2025).

[2] South Dakota v. Wayfair, Inc., 585 U.S. 162 (June 21, 2018).

[3] Wayfair LLC v. City of Lakewood, Colo., Case No. 2022CV30710 (Dist. Ct. of Jefferson County, Colo. 2022).

[4] Halstead Bead, Inc. v. Lewis, No. 2:21-CV-02106 (2021).

What’s Next for the Evolution of Public Law 86-272?

By Stefi George and David Blum on June 3, 2025 Posted in Digital Tax, E-Commerce, Income Tax

For over 65 years, Public Law 86-272 has dictated a state’s ability to assert income tax on an out-of-state business. While the 1959 federal law predated the emergence of e-commerce and digital services and could not have anticipated the way businesses would operate today, P.L. 86-272 has nonetheless remained the law of the land.

P.L. 86-272 was enacted to protect out-of-state businesses from state overreach. The law prevents states from imposing income tax on income derived within the state from interstate commerce if the only activity performed in the state is the solicitation of orders of tangible personal property. While this statute was relatively easy to apply to commercial transactions in the 20^th century, the explosion of e-commerce and the internet has changed the calculus, making it difficult to navigate for businesses soliciting over the internet.

The 2021 MTC Statement

In 2021, the Multistate Tax Commission (MTC) acknowledged this problem and developed a model statement to provide guidance specifically for internet businesses interpreting P.L. 86-272. The statement asserts that, generally, “when a business interacts with a customer via the business’s website or app, the business engages in a business activity within the customer’s state.” The MTC statement provides examples of internet activities (such as certain cookies or chat and email assistance) that self-servingly are deemed unprotected activities under P.L. 86-272.

Several states have since adopted rules that are consistent with the MTC’s position, and almost instantly have been hit with legal challenges. For instance, a New York court recently issued a decision upholding a New York regulation adopting the MTC’s interpretation.[1] The court did strike down the retroactive application of the regulations, but held that P.L. 86-272 did not restrict the state from determining and regulating which internet activities exceed mere solicitation in the state. Which begs the question of whether such regulations can exceed the scope of a law, especially a federal law designed to limit a state’s overreach.

While the court upheld New York’s narrow interpretation of P.L. 86-272 with respect to internet activities, it remains unclear whether such a position will prevail in all states (or if the New York decision will be upheld if appealed). There is significant uncertainty whether and to what extent e-commerce businesses can avail themselves of P.L. 86-272 protections.

Ultimately, a federal amendment may be necessary to clarify how to interpret the law in the internet age.

A Federal Proposal

Slipped into the reconciliation bill recently passed by the House is a proposal to do just that. The proposed language would amend P.L. 86-272 to expand the definition of “solicitation.” The House Judiciary Committee’s text would define the term to include “business activity that facilitates the solicitation of orders even if that activity may also serve some independently valuable business function apart from solicitation.”

The federal amendment would appear to significantly broaden the protection afforded to businesses under P.L. 86-272, further curtailing the ability of states to tax out-of-state businesses.

What Lies Ahead for P.L. 86-272?

At this time, it is not entirely clear from the language in the bill what would or would not be covered. The proposed revisions do not specifically address internet activities. Further, the bill is now before the Senate, where it may undergo further changes — or be stricken altogether — before the reconciliation process is complete.

A federal amendment to P.L. 86-272 is long overdue, and bringing the statute into the 21^st century would be a positive development for taxpayers and states alike. However, reconciliation may not be the best vehicle for such an amendment, especially since the amendment is revenue neutral from a federal perspective. Modernizing the law would be most effective after soliciting and incorporating comments from interest groups, and any revisions should also provide guidance for internet businesses. Thoughtful revisions to P.L. 86-272 would go a long way to providing clarity for businesses, and, if nothing else, the proposal in the reconciliation bill could bring renewed attention to an issue that has often been overlooked by Congress.

[1] Am. Catalog Mailers Ass’n v. Dept. of Taxation Finance, N.Y. Sup. Ct., No. 903320-24 (4/28/25).

A “Source” of Consternation? The Taxation of Telecommunications Companies in Florida

By Michael Bowen and Lorie Fale on April 11, 2025 Posted in Apportionment, Florida, Income Tax, Telecommunications

Like many states, Florida’s corporate income tax regime has special rules applicable to telecommunications companies. The tricky part about taxing the telecommunications industry is how to source receipts earned from providing interstate telecommunications services. Put differently, when is a state permitted to tax an interstate phone call?

For corporate income tax purposes, the only receipts sourced to Florida are those relating to a “Florida sale.” What comprises a “Florida sale” depends on the nature of the taxpayer’s business. Florida’s unique sourcing provision relating to telecommunication companies is found in Fla. Admin. Code r. 12C-1.1055(2)(g) (the “Telecom Rule”). With respect to interstate communications, the Telecom Rule defines a “Florida sale” to include all receipts where “the communication originates or terminates in Florida and the bill is charged to a Florida telecommunications number or device, Florida telephone number or telephone, or Florida customer.” Although the Telecom Rule raises several constitutional issues, the focus of this post relates to the test for “internal consistency” under the Commerce Clause.

The U.S. Supreme Court has long made clear that a state tax must be fairly apportioned in order to survive scrutiny under the Commerce Clause. What that means is that a state can only tax its fair share of the receipts earned by a multistate business. If a state’s tax law seeks to tax more than its fair share, the applicable tax is not fairly apportioned and will be struck down as violating the Commerce Clause. One test for determining whether a state tax is fairly apportioned is the test for internal consistency.

As recently reiterated by the Court in Comptroller of Maryland v. Wynne, a state tax fails the internal consistency test if its application by every taxing jurisdiction would cause a taxpayer engaged in interstate commerce to pay more in taxes than a similarly situated taxpayer conducting business solely intrastate. In other words, does a taxpayer pay more in state tax solely because it conducts business across state lines? The Florida Telecom Rule raises serious questions under the test for internal consistency.

Consider a straightforward example. Maria, is a Florida resident but has cell phone with a Georgia telephone number. Maria places a call to her friend Jim, a Georgia resident. Jim’s cell phone has a Georgia area code assigned to it. If every state applied Florida’s Telecom Rule, both Florida and Georgia would source 100% of the receipts from the same call. Florida would claim that 100% of the receipts as a “Florida sale” because the call originated in Florida and the bill is charged to a Florida customer. Applying the same law in Georgia, Georgia would claim that 100% of the receipts as a “Georgia sale” because the call terminated in Georgia and the bill is charged to a Georgia telecommunications number. This simple example is hardly unique and outlines just one of the many ways that the Telecom Rule poses challenges under the test for internal consistency. Those familiar with the holding in Goldberg v. Sweet may question the vulnerability of the Telecom Rule to a constitutional challenge. Among other distinctions, however, what saved the Illinois law in Goldberg was the inclusion of a credit provision. Specifically, Illinois law permitted the taxpayer a credit against the Illinois tax for tax paid to any other state on the same telephone call. The Telecom Rule contains no such credit mechanism. Consternation indeed.

Taxing the Intangible: Applying Conventional Definitions to Modern Digital Products

By Joshua Hamlet and Stefi George on April 2, 2025 Posted in Colorado, Digital Tax

In an ongoing battle against Netflix Inc., the Colorado Department of Revenue has argued that the historical definition of “tangible personal property” is sufficiently broad as to encompass digital goods — including streaming subscriptions.[1] The case, currently in the Colorado Court of Appeals, raises fundamental questions about the application of outdated legal definitions to the modern digital economy.

At the heart of the dispute is a 1933 edition of Black’s Law Dictionary, which the State relies upon for its position that tangible property includes anything “perceptible by the senses.” Colorado argues that because streaming content is seen and heard, it falls within the scope of tangible personal property and is thus taxable under the state’s sales tax law. Netflix, on the other hand, contends that its streaming service merely grants access to content rather than transferring a physical product — a distinction that has long separated services from taxable goods for sales tax purposes. A district court ruled in Netflix’s favor last year, but the state is pursuing an appeal.

Colorado’s interpretation would expand the concept of “tangible” beyond its conventional meaning. Equating digital accessibility with physical ownership could blur the lines between services and goods in ways that ripple well beyond streaming subscriptions. Of course, when the definition was adopted in 1933, no one could have envisioned this application in today’s digital world.

The Broader Implications for Businesses

Application of archaic definitions to today’s businesses is a significant challenge in sales tax. Colorado’s approach in the Netflix case highlights a concern that many digital businesses face as they try to determine how to interpret and comply with outdated statutes and definitions.

The Netflix case is not just a dispute over semantics; it reflects a broader trend of states pushing the limits when it comes to digital services. Taxation should evolve with the economy, because when it does not, it becomes increasingly difficult for companies to properly determine their tax obligations. Forcing digital transactions into frameworks designed for a world of physical goods creates confusion and uncertainty for businesses.

Looking Ahead

States are constantly looking for new revenue streams, and digital goods can be a significant revenue source. The surge in remote work, online entertainment, and e-commerce has shifted economic activity away from traditional taxable goods. While many states have approached digital products by broadening the scope of services that are covered under their sales tax regimes, others have attempted to reinterpret and stretch the definition of tangible personal property to capture modern business operations.

Regardless of the ultimate result in the Netflix case, digital businesses should be prepared to address expansive interpretations of “tangible” property. With the evolving landscape of digital taxation, businesses must stay informed, as these interpretations can have unanticipated implications for their operations.

[1] Netflix Inc. v. the Department of Revenue for the State of Colorado, et al., Case Number 2024CA1019, Colorado Court of Appeals

It’s None of My Business! Arkansas Court Rules on Business v. Non-Business Income Distinction

By Michael Bowen on March 26, 2025 Posted in Apportionment

Income received by a multistate business is either “business income” or “non-business income.” Although this labeling appears innocuous, the distinction between these two categories of income matters greatly to taxpayers and state departments of revenue alike. While business income is apportionable to the various states in which the taxpayer conducts business, non-business income is allocable to the taxpayer’s state of domicile. Given the all-or-nothing result of a non-business income determination, many a state controversy stems from this definitional tug of war.

In United States Beef Corporation v. Walther, the issue was whether the capital gain received by the taxpayer from the sale of its Arby’s and Taco Bueno franchises was business or non-business income under the laws of Arkansas. The facts of the case were that the taxpayer, domiciled in Oklahoma, received unsolicited offers to purchase the franchises. The franchises operated in several states, including Arkansas. Following the sale of the franchises, the taxpayer liquidated its business. The taxpayer argued that the capital gain was non-business income because it was in the business of acquiring and operating franchises, not disposing of them.

The result in the case turned on the definition of business and non-business income under Arkansas law. The definition of “business income” included “income arising from transactions and activity in the regular course of the taxpayer’s trade or business and includes income from tangible and intangible property if the acquisition, management, and disposition of the property constitute integral parts of the taxpayer’s regular trade or business operations.” “Non-business” income was defined as income that is not “business income.” The court, applying prior precedent, made clear that whether income is business or non-business income is dependent on the application of the “transactional test” and “functional test.” The parties had stipulated that the transactional test was not an issue in the case. Thus, the court’s analysis was focused on the “functional test.”

The court explained that the income is “business income” under the functional test “if the acquisition, management, and disposition of the property constitute integral parts of the taxpayer’s regular trade or business operations.” In the factual context of the case, the court framed the issue as whether the taxpayer was in the business of acquiring, managing, and disposing of the franchises. There was no question that the taxpayer had long been in the business of acquiring and managing franchises. However, the court held that the taxpayer was not in the business of disposing of franchises. As a result, the court determined that the capital gain was non-business income allocable to Oklahoma, the state of the taxpayer’s domicile. It is important to highlight that states differ on how they define the distinction between business and non-business income. Despite the fact that many share the same statutory language derived from the UDITPA, the analytical approaches vary widely. Some states rely solely on the transactional test while others, like Arkansas, employ both tests. Within each of these categories lies a spectrum of how broad or narrow the relevant test(s) is applied. Care must be taken to closely consider the laws of the several states in which a taxpayer does business. What is “business income” in one state may very well be “non-business” income in another.

Maryland’s High Court Hands the State a Big Win in its Digital Ad Tax Dispute, More Challenges to Follow

By David Blum and Stefi George on May 15, 2023 Posted in Digital Tax, E-Commerce, Maryland, Sales Tax

Last fall, when a Maryland County Circuit Court held that the Maryland Digital Ad Tax violated the dormant commerce clause, the supremacy clause, the Internet Tax Freedom Act, and the First Amendment of the U.S. Constitution, most of the tax world anticipated that the Maryland Comptroller would promptly appeal the ruling, which it did. The State argued that the Circuit Court’s decision must be reversed because the plaintiffs had not properly exhausted their administrative resources prior to bringing the lawsuit, as required under state law.

On May 9, 2023, the Maryland Supreme Court, in a per curiam opinion, handed the State of Maryland a major victory, only days after hearing oral arguments. The Maryland Supreme Court held that the Circuit Court did not have jurisdiction in the first place because the plaintiffs did not exhaust their administrative remedies, and vacated the lower court’s October 2022 ruling. In a somewhat unusual move, the Court rendered its decision in summary form and indicated that an opinion explaining its reasoning would be forthcoming, so there will be more to unpack in the future. But in the short term, what does this procedural decision mean for the Digital Ad Tax and SALT law more broadly?

What’s Next For Maryland’s Digital Advertising Tax?

By Stefi George, David Blum and Chelsy Lutz on October 31, 2022 Posted in Digital Tax, Maryland, Sales Tax

Maryland’s controversial Digital Advertising Gross Revenues Tax (the “Digital Ad Tax”) recently shot back to the top of the headlines when Maryland Circuit Court Judge, Alison Asti, ruled from the bench that the tax is unconstitutional and violates the federal Internet Tax Freedom Act (“ITFA”). Judge Asti ruled in favor of Verizon and Comcast that the Digital Ad Tax violates the ITFA, the First Amendment and the Commerce Clause due to its selective taxation, and the fact that it is not content neutral.

Illinois DOR Proposes to Change Income Tax Liability for Businesses that Make Sales to Foreign Countries

By David Blum and Akerman Law on May 31, 2022 Posted in Illinois, Income Tax

The Illinois Department of Revenue (“IDOR” or “Department”) recently issued a Notice of Proposed Amendment to amend its Regulation (86 Ill. Admin. Code § 100.3200) governing the “throwback” and “throwout” apportionment provisions (the “Amendments”). 46 Ill. Reg. ___ (Apr. 15, 2022), at 5856. If adopted, the Amendments would change the Illinois income tax burden imposed on a business by altering the business’ apportionment with respect to sales made into certain foreign countries. Continue Reading