Multi-state Income Taxes | Companies expanding into Georgia

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 In 2021, Georgia was named the best state for conducting business in the US, making it the eighth consecutive year to have the title. After gaining economic momentum despite the pandemic, the State of Georgia continuously brings more jobs and opportunities to Georgians. 

• S Corporations
  • Filing Requirements
    • All corporations that own property, do business in Georgia or derive income from Georgia sources are required to file a Georgia income tax return.
  • Allocation & apportionment
    • One Factor Formula: Gross Receipts
    • Market-based apportionment
      • Revenues received from customers within the state

• Partnerships
  • Filing Requirements
    • A partnership, limited liability company, syndicate, group, pool, joint venture and unincorporated organization which is engaged in business or owns property located in Georgia or has members domiciled in Georgia or has income from Georgia sources, and which is required to file a Federal Income Tax return on Form 1065, is required to file a Georgia Income Tax return on Form 700.
  • Allocation & apportionment
    • One Factor Formula: Gross Receipts
    • Market-based apportionment
      • Revenues received from customers within the state
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• Employees & individual filers
  • Filing requirements
    • 1. Nonresidents who work in Georgia or receive income from Georgia sources and are required to file a Federal return are required to file a Georgia income tax return. 
    • 2. Legal residents of other states are not required to file a Georgia tax return if their only activity for financial gain or profit in Georgia consists of performing services for an employer as an employee where the wages for such services do not exceed the lesser of five percent of the income received from performing services in all places during the taxable year or $5,000. 
    • 3. A nonresident, who receives deferred compensation or income from the exercise of stock options that were earned in Georgia in a prior year is required to pay tax on the income, but only if the prior year’s income exceeds the lesser of 1) 5 percent of the income received by the person in all places during the current taxable year; or 2) $5,000. However, the income is not taxed if federal law prohibits the state from taxing it. Federal law prohibits state taxation of some types of retirement income including pensions as well as income received from nonqualified deferred compensation plans if the income is paid out over the life expectancy of the person or at least 10 years. See Regulation 560-7-4-.05 for more information.