Q&A with the Pennsylvania Department of Revenue

May a corporate taxpayer rely upon the MTC’s Section 17 regulation for purposes of sourcing receipts from services until the DOR issues market-based sourcing regulations for CNIT purposes?

Jan 22, 2018
From a legal perspective, the MTC regulation cannot be relied upon as having the effect of legal authority. However, since Pennsylvania’s statutory language is very similar to that adopted by the MTC, the Department believes the MTC’s regulations for sourcing receipts from services represent a valuable guideline for Pennsylvania taxpayers seeking additional guidance on how to interpret the statutes.

DISCLAIMER: The Department of Revenue has prepared draft regulations for sourcing receipts of services and intangibles. The initial drafts are currently under internal review and will be made available for public inspection/review/comment as soon as practical. Accordingly, any responses contained herein are based on previously-provided guidance from the Department.

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These documents provide a summary of the answers provided by the Department of Revenue to the PICPA Committee on State Taxation at its annual question and answer session. These documents are classified as revenue information issued for informational purposes only for the convenience of PICPA members. Pursuant to 61 Pa. Code Section 3.4, these documents should not be relied upon for any purpose or used in tax appeals. Taxpayers requiring a binding opinion on their specific fact situation may request a written letter ruling under 61 Pa. Code Section 3.3.