Press Room: Tax Release

December 12, 2014

Should I Make a California MTC Election?

While the state tax community eagerly awaits the commencement of oral arguments in front of the California Supreme Court in Gillette Company v. Franchise Tax Board (see Andersen Tax’s previous tax release on the Court of Appeals decision here), California taxpayers should start thinking about their apportionment options now. For many California taxpayers, inaction may result in closed tax years and missed opportunities. These opportunities may be weighed against penalties that could apply should California prevail. To facilitate the decision-making, the below chart summarizes the possible scenarios where a California taxpayer may make an election and the possible consequences. Each taxpayer should consider unique facts including audit history and uncertain tax positions when weighing the risks and benefits of the election.