The Illinois Independent Tax Tribunal has agreed to review two notices of deficiency issued to a global payments business as a result of the Department applying the throwout rule excluding certain of the taxpayer’s receipts from the sales factor denominator. Under Illinois law, receipts that are attributed to a jurisdiction in which the taxpayer is not subject to tax are excluded from the denominator of the sales factor. A departmental regulation requires a taxpayer to pay tax owed in another jurisdiction to be considered “subject to tax” in that state or foreign country. In its petition for review, the taxpayer asserts that the regulation exceeds the scope of the statute by requiring it to actually pay tax owed in other jurisdictions to avoid throwout. The taxpayer also argues that it is subject to tax everywhere based on applying the significant economic presence standard articulated in the Illinois’ Capital One decision. As such, the taxpayer requests that the Tribunal find that the regulation is an invalid limitation on the statute and that none of its receipts should be thrown out because it is subject to tax everywhere. The petition for review also sets forth several constitutional arguments against the application of the throwout rule. Please contact Brad Wilhelmson at (312) 665-2076 with questions.