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LIC-6.13 - De Minimus Business Activity for Tangible Personal Property

DE MINIMUS BUSINESS ACTIVITY FOR TANGIBLE PERSONAL PROPERTY
Administrative Rules Adopted by Bureau of Licenses Pursuant to Rule-Making Authority
ARB-LIC-6.13

 
"De Minimus" means activity that is trivial, of little importance or significance. Activity that is not routine and continuing or has little or no tie to the production of income is considered de minimus. De minimus activity does not create nexus in a jurisdiction. See, for example, Wisconsin Dept of Revenue v Wrigley _US_, 120 LEd2d 174, 172 SCt 2447 (1992)
Example 1: Snazzy Jacket Company manufactures and warehouses all manufactured goods in the City. Employees take orders by phone and mail at the City location. All orders are filled from that location and are shipped by a freight carrier to customers. All business activity is conducted within the City. Once a year an employee will call on a customer outside the City only for the purpose of seeing how the merchandise is displayed. No orders are taken. This activity is de minimus and does not create business activity outside the City and, therefore, no apportionment is allowed.
 
Example 2: Comfy Coats Company manufactures and warehouses all its manufactured goods outside the County. Employees take orders by phone and mail from the location outside the County. All orders are filled from that location and are shipped by a freight carrier to customers around the country, including Portland. All business activity is conducted outside the County. Once a year an employee will call on a Portland customer for the purpose of seeing how the merchandise is displayed. No orders are taken. This activity is de minimus and does not create business activity in the County. Comfy Coats Company does not file a business income tax return with the County.

 
REFERENCES
 
Portland City Code Section 7.02.610 A.
 
Multnomah County Code Section 5.60.610 A.

 
HISTORY
Submitted for inclusion in PPD September 17, 2002.
Originally adopted as Bureau of Licenses Administrative Rule 610.93-3 November 23, 1993, amended as 610.93-3A December 26, 2000.

Table of Contents
LIC-6.01 - Payments Deemed to be Compensation to Owners
LIC-6.02 - Self-Employment Tax Deduction and Health Care Premium Deduction
LIC-6.03 - Change of Ownership During the Year and Calculation of the Compensation Allowance Deduction
LIC-6.04 - Patronage Dividends
LIC-6.05 - Short Periods Count as Tax Year
LIC-6.06 - Definition of Controlling Shareholders and Calculation of Number of Controlling Shareholders
LIC-6.07 - Treatment of Currently Taxed Pass-Through Income
LIC-6.08 - Partnerships - Partner Level Deduction Election
LIC-6.09 - Qualified Retirement Plans
LIC-6.10 - De Minimus Business Activity for Personal Services
LIC-6.11 - Apportionment of Gains and Incomes Due to Sale of a Business
LIC-6.12 - Business Activity and Apportionment of Sales of Tangible Personal Property
LIC-6.13 - De Minimus Business Activity for Tangible Personal Property
LIC-6.14 - Apportionment of Gross Income from Business Activities Other than Sales of Tangible Personal Property
LIC-6.15 - Apportionment for Banking Income
LIC-6.16 - Apportionment for Domestic Insurers
LIC-6.17 - Apportionment for Freight Carriers
LIC-6.18 - Apportionment for Passenger Carriers
LIC-6.19 - Apportionment for Incomes Subject to PCC Chapters 7.12 or 7.14
LIC-6.20 - Apportionment for Providers of Electronic or Telephonic Services