Missouri Adopts Rule Interpreting New Single Sales Factor Apportionment Method Election

The Missouri Department of Revenue has adopted a rule, effective March 30, 2014, implementing the provisions of H.B. 128, which contains a new apportionment method election for corporate income tax purposes.¹ This election, which allows taxpayers to utilize a single sales factor method based on total sales from transactions in Missouri divided by total sales everywhere, is effective for original corporate income tax returns filed on or after August 28, 2013.

Corporate Income Tax Apportionment Election

Missouri historically has provided taxpayers with the option to apportion income using either an equally-weighted three-factor formula including sales, property and payroll factors or a modified single-sales factor method.² Under the modified single-sales factor method, the numerator of the sales factor includes all the taxpayer's sales or business transacted wholly within Missouri and half of its sales or business transacted partly within and partly without Missouri,