Question

Hulk Corp. realizes it has income tax nexus with 5 states (all of which impose an income tax). As a result, Hulk will:

a) Pay income tax in all 5 states
b) Determine tax liability in each state
c) File tax returns in each state
d) All of the above

Answer 1

Hulk Corp. will pay income tax, determine tax liability, and file tax returns in all 5 states where it has an income tax nexus.

Step-by-step explanation:

If Hulk Corp. realizes it has income tax nexus with 5 states, the correct answer to what actions the company will need to take is d) All of the above. This means that Hulk Corp. will: a) Pay income tax in all 5 states where nexus is established.

b) Determine its tax liability in each state which might involve different rates, exemptions, and policies, and c) File tax returns in each state to comply with the state's tax regulations.