Determine whether Napoleon may be liable to South Dakota State and/or Massachusetts for state income and/or sales taxes associated with sales in those particular jurisdictions. Be sure to explain in detail your answer. You need to be thorough and systematic in your explanation. Also discuss factors that would bear on whether there is nexus in these jurisdictions and why there is or is not nexus.(60 Points)
REQUIRED: Please consider the following items in analyzing whether or not Napoleon is subject to tax in the jurisdiction:
- If you determine that there is nexus in one or more of the jurisdictions, then what alternatives would you suggest to your clients in order to reduce Napoleon’s risk of being subject to state income or sales tax in that state, yet still be able to conduct business with those customers. (15 points.)
- How would your answer in 1. above change if Napoleon shipped all of its inventory to
Amazon’s warehouse in Texas so that customers would order Napoleon’s products only through the Amazon website? Amazon would have the responsibility for packaging and shipping the order. Consider the following scenarios: a) Amazon purchases the product from Napoleon and Amazon fulfills customer orders; and b) where Napoleon has the product on consignment to Amazon with Amazon fulfilling customer orders. (25 points.)
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