Adopted Uniformity Recommendations

The models below organized into the following general categories:

Allocation and Apportionment Regulations,
Business Income Tax – General,
Other Income Tax,
Sales and Use or Transaction Taxes, and
Tax Administration

See also the Uniformity Developments page.

If you need any information, please contact Helen Hecht.

Allocation and Apportionment – Statutes and Regulations

Title	Related Information	Year Adopted or Amended by Commission	Description of the Model and Its Function
Recommended Uniform Division of Income for Tax Purposes Act (UDITPA) – Article IV of the Multistate Tax Compact	Document Library	Original adopted in 1967 as part of the Multistate Tax Compact, revised by the MTC in 2014 and 2015.	The original version of the Uniform Division of Income for Tax Purposes Act (UDITPA) was drafted by the Uniform Law Commission and included in Article IV of the Compact. In 2014 and 2015, the MTC recommended that states adopt uniform revisions to the provisions of UDITPA and that Compact states include those revisions in their statute adopting the Compact.
Model General Allocation and Apportionment Regulations Model in Word Reformatted (with navigation) – in Word	Document Library – archive for Sections 1 and 17 rules. Document Library – archive for Section 18 rules.	Original 1973; revised multiple times through 2010; amended to implement changes to Art. IV (UDITPA) in 2017 and 2018.	Provides general rules for implementing the Uniform Division of Income for Tax Purposes Act (UDITPA), as the MTC has recommended revising that model act. See information on the recommended version of UDITPA. It also contains detailed principles for determining the existence of a “unitary business.” See the Summary of the Model General Allocation and Apportionment Regulations for more information.
Special Rule: Airlines	Airlines Archive	1983	Provides special industry rules for allocating and apportioning the income of commercial airlines and for sourcing receipts, property, and payroll.
Special Rule: Construction Contractors		1980	Provides special industry rules for allocating and apportioning the income of construction contractors taking into account the different accounting methods used for such income.
Special Rule: Publishing	Hearing Officer Report Hearing Officer Report (1992 Interim)	1993	Provides special industry rules for allocating and apportioning the income of publishers including rules for sourcing advertising receipts using a “circulation factor.”
Special Rule: Railroads		1981	Provides special industry rules for allocating and apportioning the income of railroads and for sourcing receipts, property, and payroll.
Special Rule: Television and Radio Broadcasting	Hearing Officer Report (1995) Hearing Officer Report (1989)	Original – 1990 Amended – 1996	Provides special industry rules for allocating and apportioning the income from television and radio broadcasters including rules for sourcing receipts using an “audience factor.”
Special Rule: Trucking Companies	Hearing Officer Report	Original -1986 Amended – 1989	Provides special industry rules for allocating and apportioning the income of trucking companies including rules for sourcing receipts, property, and payroll.
Special Rule: Telecommunications and Ancillary Service Providers	Hearing Officer Report (2008) Supplemental Hearing Officer’s Report (2008)	2008	Provides special industry rules for allocating and apportioning income of telecommunications and ancillary service providers and for sourcing receipts, property, and payroll.
Special Rule: Receipts Factor – Bank Holding Companies and Subsidiaries	Document Library	2018	Expands the scope of the special industry rules for financial institutions (see below) to include bank holding companies, bank subsidiaries, and savings and loan holding companies and subsidiaries
Recommended Formula for the Apportionment and Allocation of Net Income of Financial Institutions	Document Library	Original – 1994 Amended – 2015	Provides special industry allocation and apportionment rules for the financial industry. The 2015 version modified the property factor of the original to exclude loans (and therefore disposed of the SINAA test). The 2015 version also modified the receipts factor to increase “market state” orientation and to reflect changes in services provided by the financial industry.

Business Income Tax – General

Title	Related Information	Year Adopted or Amended by Commission	Description of the Model and Its Function
ABA Model S Corporation Income Tax Act	Hearing Officer Report	1991	Provides general rules for taxing S corporations based on a model drafted by the American Bar Association Section of Taxation Committee with certain modifications.
Statement of Information Concerning Practices of the Multistate Tax Commission and Supporting States Under Public Law 86-272	2021 Resolution adopting Statement Archive Page for 2021 Revision Including: Hearing Officer Report Draft Revisions Other Analysis Hearing Officer Report, 2001 Hearing Officer Report, 1994 States Reports Regarding State Adoption: 1996 2013	Original – 1986 Revised -1994 Revised 2001 Revised 2021	Sets out the consensus view of adopting states on the interpretation and application of the federal statute to particular, common factual scenarios, updated as necessary to reflect changes in business practices and any judicial authorities. The purpose of the statement is to provide notice to taxpayers of the position taken by the state administrative agency. The 2021 revisions address activities conducted via the Internet.
Model Statute for Combined Reporting (Joyce Method) (See also the Model for Compilation of State Tax Return Data below.)	Hearing Officer Report (2011) Staff Report (2011) Staff Report (2010) Hearing Officer Report (2005) GAO Report (2008) Tax Haven Project Memo to the Full Commission (2006) Supplemental Report (2005)	Original – 2006 Amended – 2011	Provides a model for unitary combined reporting using the Joyce method. That method combines the unitarry apportionable income of the entities in the group, but has each entity idetermine its own in-state share of that group income, applying an apportionment formula that uses the entity’s numerators and the group’s denominators. The model defaults to worldwide unitary combination with a “water’s edge” election. The 2011 amended model includes tax haven entities in the water’s edge group based on criteria for what is considered a tax haven.
Model Statute for Combined Reporting (Finnigan Method) (See also the Model for Compilation of State Tax Return Data below.)	2021 Resolution adopting Model Archive Page Including: Hearing Officer Report Draft Models White Papers and Other Analysis	2021	Provides a model for combined reporting using the Finnigan method. That method treats the group as if it were a single taxpayer, combining the apportionable unitary income of the entities in the group and apportioning that income using a single group apportionment formula. The model is otherwise similar to the Model Statute for Combined Reporting using the Joyce method (above), with minor updates.
Model Statute on Disclosure of Reportable Transactions Model Statute for Tax Avoidance Transaction Voluntary Compliance Program	Memo to Commission (2006) Final Hearing Officer Report (2006) Preliminary Hearing Officer Report (2005)	2006	These models promote corporate income tax compliance by requiring taxpayers and advisors to disclose reportable transactions and provide for a voluntary compliance program with respect to those transactions. Penalties are imposed for failures to disclose and relief is given under the voluntary program. The models follow existing federal law on reportable transactions with modifications where necessary to reflect state tax law.
Factor Presence Nexus Standard for Business Activity Taxes	2022 Resolution Supporting Adoption by States Adopting the Statement on P.L. 86-272 Press Release (2002) Explanation of the Factor Presence Model	2002	This model provides a simple bright-line nexus test for business activity taxes including corporate income tax. A business will have nexus if it exceeds any of the following apportionment factor numerator thresholds in that state during a tax period: $50,000 of property; $50,000 of payroll; $500,000 of sales; or 25% of total property, total payroll, or total sales.
Requiring the Add-back of Certain Intangible and Interest Expenses	Hearing Officer’s Report Memo to Executive Committee (2006) Status Memo to Full Committee (2006)	2006	This model addresses the use of intangible holding companies to shift income earned in the state to another jurisdiction in which that income is not taxed. The model adds back expenses for intangibles and for interest (in separate sections), incorporating specific exceptions.
Compilation of State Tax Return Data		2006	This model provides for important information reporting and record keeping for corporations filing a combined report to allow state audits. (See the model Statutes for Combined Reporting, above).
Taxation of Captive Real Estate Investment Trusts	REIT Final Hearing Officer’s Report	2008	This model requires that a “captive REIT” add back its dividends paid deduction. A “captive REIT” is a REIT the shares or beneficial interests of which are not regularly traded and that has more than fifty percent of its voting power or value of its beneficial interests or shares owned or controlled by a single nonexempt corporation. (See also the model for Disallowance of Certain Payments to Captive REITs, below.)
Disallowance of Certain Payments to Captive REITs	Hearing Officer Report	2011	This model disallows deductions like rent and interest for payments made by affiliates to a captive REIT. (See also the model for Taxation of Captive Real Estate Investment Trusts, above.)

Other Income Tax

Title	Related Information	Year Adopted or Amended by Commission	Description of the Model and Its Function
Defining the Residence of a Funeral Trust – Statutory or Regulatory Provision	Hearing Officer Report (2001)	2001	This model provides a uniform standard for determining the location of a funeral trust.
Mobile Workforce Legislation	A Comparison of MTC and Other Models Hearing Officer Report Status Memo to Uniformity Committee	2011	This model sets out proposed uniform rules establishing a threshold for when a nonresident employee is subject to tax and when the employer is required to withhold on that non-resident employee’s wage income. The model incorporates specific exceptions to the threshold and specifies information employers can rely on.
Reporting Options for Nonresident Members of Pass-Through Entities with Withholding Requirement	Second Hearing Officer Report (2003) Supplemental Hearing Officer Report (2003) Hearing Officer Report (2002)	2003	This model establishes a withholding requirement for pass-through entities that have nonresident owners and also authorizes a composite return that can be filed by the entity on behalf of those owners.

Sales & Use or Excise Tax

Title	Related Information	Year Adopted or Amended by Commission	Description of the Model and Its Function
Applicability of Sales and/or Use Tax to Sales of Computer Software		1988	This guideline lays out a series of definitions to establish a uniform standard by which the signatory states will distinguish between canned and custom sales of computer software.
Collection and Remittance of Lodging Taxes by Accommodations Intermediaries	First Hearing Officer’s Report Second Hearing Officer’s Report Second Hearing Officer’s Report (As Amended)	2012	This model requires accommodations intermediaries to collect tax from customers purchasing accommodations–whether the tax is owed by the intermediary or the accommodation provider. Then the model provides two options for reporting and remitting the tax to the state or local tax agency.
Principles Governing State Transactional Taxation of Telecommunications		1993	This uniformity recommendation proposes uniform principles to govern state transactional taxation of basic telecommunication services, as distinguished from enhanced services.
Sales and Use Tax Nexus (Engaging in Business)	Document Library	2016	NOTE: This model was adopted before the U.S. Supreme Court’s decision in Wayfair. The Commission has since developed a white paper on best practices for implementing that decision.
Sales and Use Tax Priority: Construction Inventory		2002	This model provides for a credit on certain building materials that are resold or incorporated into other building components that are resold/installed in a construction project.
Sales and Use Tax Priority: Leasing Transactions		2004	This model establishes standard rules for claiming tax credits to avoid double or multiple taxation of portions of a single leasing transaction of property that may be leased in multiple states.
Model Direct Payment Permit Regulation	Initial Hearing Officer Report (2000) Final Hearing Officer Report (2000)	2000	This provision allows the state to grant holders the ability to accrue and pay state and local sales taxes directly to the state on taxable purchases.
Provision for the Collection of Tax on Fundraising Transactions	Hearing Officer Report	2000	This model provides that nonprofit or charitable organizations are not required to collect sales tax on the sales of tangible personal property for fundraising purposes.

Tax Administration

Title	Related Information	Year Adopted or Amended by Commission	Description of the Model and Its Function
Audit Sampling Authorization Statute and Accompanying Regulation	Hearing Officer’s Report Exhibit A (COST) Exhibit B (Redlined) Exhibit C (Clean)	2007	This model statute allows the state tax department to use statistical sampling techniques or other sampling techniques when necessary during audit. The accompanying regulation defines judgmental, probability and statistical sampling techniques.
Communications Transaction Tax Centralized Administration		2012	This model includes three options for centralized collection of communications taxes. Option I provides for state imposition and administration, with revenue sharing to local governments. Option II provides for state and local imposition and state level administration. Option III provides for local imposition and centralized local administration.
2019 Model Uniform Statute for Reporting Adjustments to Federal Taxable Income and Federal Partnership Audit Adjustments – With Technical Corrections Adopted November 2020	Document Library Hearing Officer Report (2018) 2019 Model – Prior to Technical Corrections 2003 Model for Reporting Federal Tax Adjustments Hearing Officer Report (2003 model)	Original – 2003 Amended to address centralized partnership adjustments – 2019	This model sets out uniform rules for taxpayers to follow in reporting the state tax effects of federal tax adjustments including amended returns and audit adjustments. The model was amended in 2019 to accommodate the reporting of federal adjustments from centralized partnership audits conducted by the IRS under the federal Bipartisan Budget Act of 2015 and allows for a partnership-pays election for state taxes.
Uniform Protest Statute		1990	This model lays out a uniform procedure by which a taxpayer may contest an assessment.
Model Recordkeeping and Retention Regulation	Hearing Officer Report (1997)	1998	This model imposes requirements for the maintenance and retention of books, records, and other sources of information for tax purposes. It also addresses requirements applicable to electronic records.