Multi-Jurisdictional & International Basics

State nexus

• Sales tax: economic nexus (often $100,000 of in-state sales) since the Wayfair decision.
• Income tax: Public Law 86-272 shields solicitation of orders for tangible goods only.

Apportionment

Mostly single sales factor; market-based sourcing for services; throwback rules in some states.

Individuals

Residents taxed on all income; nonresidents on in-state income; domicile or 183-day statutory residency; credit for other states' taxes; pass-through entity tax elections avoid the state and local tax cap.

International — individuals

• US citizens and residents: worldwide income.
• Foreign earned income exclusion: $132,900 (2026).
• Foreign tax credit: limited to US tax on foreign income; back 1, forward 10.
• Report of Foreign Bank and Financial Accounts (FBAR): foreign accounts > $10,000 total.
• Nonresident aliens: 30% withholding on US investment income unless a treaty applies.

International — corporations

100% deduction for foreign dividends from 10%-owned corporations · Subpart F · net controlled foreign corporation (CFC) tested income (formerly global intangible low-taxed income) · transfer pricing at arm's length.

Exam traps

• Physical presence still creates nexus — Wayfair added economic nexus; it didn't replace physical presence.
• The FBAR is filed with the Financial Crimes Enforcement Network (FinCEN), separately from the income tax return.
• The foreign earned income exclusion and the foreign tax credit can't both be used on the same income.
• Green card holders are US residents taxed on worldwide income, even while living abroad.