On January 2, 2015, the Massachusetts Department of Revenue (the “Department”) repealed and replaced section 63.38.1 of title 830 of the Code of Massachusetts Regulations (the “Market-Based Sourcing Regulation”) to supplement the market-based sales sourcing apportionment law applied to receipts from sales of other than tangible personal property under section 38(f) of chapter 63 of the General Laws of the Commonwealth of Massachusetts (the “Market-Based Sourcing Law”), which was enacted July 24, 2013.[1]

The Market-Based Sourcing Regulation is very lengthy and provides detailed rules pertaining to assigning a receipt from the sale of other than tangible personal property, including a sale of an in-person service, a transportation/delivery service, and a professional service, as well as licensing, leasing, and selling of intangible property, among others. The receipts-assignment rules under the Market-Based Sourcing Regulation are effective for taxable years beginning on or after January 1, 2014, which is the same as effective date of the Market-Based Sourcing Law.[2]

[1] See also Mass. Ch. 36 (H.B. 3535), Acts of 2013. [2] Mass. Regs. Code tit. 830, § 63.38.1(14).

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