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Executive Summary Flamingo Corporation, a C corporation that incorporated in California in 1994, manufacturers, sells, and distributes home accessories. Flamingo Corporation is looking into relocating its manufacturing and distribution functions to another state. Flamingo is considering relocating to Indiana, Texas or South Dakota. After extensive research the findings indicate that Flamingo should relocate to South Dakota. California Currently, Flamingo’s manufacturing, sales and distribution activities are conducted in California. California is one of the states with the highest corporate tax rate; refer to Table R-1. California corporations are taxed at a rate of 8.84%. California has enacted its own UDITPA provisions. Generally, such a determination is made by allocating non-business income in its entirety to the state of origin or to the commercial domicile of the taxpayer and by apportioning business income among the states that are the sources of the income. The formula applied determines the ratios of the property, payroll, and double-weighted sales factors within California; the sum of these ratios is then divided by four. South Dakota I recommend manufacturing and distribution functions to be relocated in South Dakota. As a South Dakota entrepreneur Flamingo would have a competitive edge over its counterparts. South Dakota has no corporate income tax.
Approximate Word count = 787
Approximate Pages = 3.1
(250 words per page double spaced)
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