A Taxpayer Has Nexus with a State for Sales and Use

question 147

True/False

A taxpayer has nexus with a state for sales and use tax purposes if it has a physical presence in the state.

---

Definitions:

Financial Leverage

The use of borrowed funds (debt) to amplify potential returns on investment, which could also increase the potential for loss.

Indirect Bankruptcy Cost

Expenses that a company incurs when it approaches bankruptcy that do not include actual legal and other direct costs, such as lost sales, damage to reputation, and management distraction.

Bankruptcy Court

A specialized federal court dealing with cases involving individuals or businesses that cannot repay their outstanding debts.

Business Risk

The exposure to factors that may cause a business to experience lower profits or financial loss.