Texas amends service sourcing rule to rely on location of personnel, property

Texas generally sources revenue from services to the location where the service was performed.

On March 25, 2022, the Texas Supreme Court rejected the “receipt producing, end-product act” test as a factor in determining the location of where a service is performed for apportionment sourcing purposes. On November 10, 2022, the Texas Court of Appeals, on remand, determined that the taxpayer’s cost-of-performance methodology was acceptable in determining the fair value of services performed in Texas.

Source PwC

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