Tax returns to file

[TAX]

Client, an scorp, located in GA.

This s corp has only two employees - Owner & his souse

These owner/employees work in PA. Withholding was done for GA in 2009 as client thought that they will be in PA for only short perid of time.

Does following sound right for 2009

(1) File GA scorp return - Resident return - GA

(2) File PA scorp return - NON - Resident return - GA

(2) File GA personal return - Resident return

(3) File PA personal non-resident return

For 2010:
(1) Should client continue same way? Not sure about where they will be in GA or PA?

Thank you!

[ChEAr$]

S corp

From the way you describe it, a couple owns a corporation which is registered in Georgia.

The minute that corporation started doing business in PA, it should have registered in that state as a foreign corporation. Can't speak for PA, but if GA finds out about a foreign corporation not registered in Atlanta, there are penalties. Anyway...

It's probably too late to register correctly in PA, but of course client should make that call.
My attitude would be that of the "go forth an sin no more.", and make sure client registers in PA forthwith.

OTOH, if only those employees operated out of their own residences and the corporation still maintained office in GA, one COULD/MIGHT argue that corporation has no nexus in PA.
Probably best for client to get local PA counsel on this issue.

Whether client and wife are still residents of GA, and therefore non residents of PA, is
another issue of course.

[JohnH]

Based on an experience I had a couple of years back, PA will go to absurd lengths to find Nexus and they will do their best to make your client's lives miserable unless/until they go along.

[TAX]

More info.

From the way you describe it, a couple owns a corporation which is registered in Georgia.

The minute that corporation started doing business in PA, it should have registered in that state as a foreign corporation. Can't speak for PA, but if GA finds out about a foreign corporation not registered in Atlanta, there are penalties. Anyway...

It's probably too late to register correctly in PA, but of course client should make that call.
My attitude would be that of the "go forth an sin no more.", and make sure client registers in PA forthwith.

OTOH, if only those employees operated out of their own residences and the corporation still maintained office in GA, one COULD/MIGHT argue that corporation has no nexus in PA.
Probably best for client to get local PA counsel on this issue.

Whether client and wife are still residents of GA, and therefore non residents of PA, is
another issue of course.

I just talk to client and here is what I found out

(1) Client does not have home in GA but used friends address to open GA corporation as GA required registered agent in GA

(2) Client, being a conusltant moves from state to state. This is why he wanted to have corporation in one state - GA.

(3) So do I need to file GA corporation return and then file non resident PA Corporation return?

Thanks!

[ChEAr$]

I just talk to client and here is what I found out

(1) Client does not have home in GA but used friends address to open GA corporation as GA required registered agent in GA

(2) Client, being a conusltant moves from state to state. This is why he wanted to have corporation in one state - GA.

(3) So do I need to file GA corporation return and then file non resident PA Corporation return?

Thanks!

Certainly a Georgia corporate return is to be filed, since that is where the corporation is
a domestic one.

Remember what I said about the corporation registering in PA? If your client's corporation was doing business IN the state of PA, then it should (have) register(ed)
in PA. If it didn't yet still files a non resident PA corp return, I smell trouble.

Likewise, if the corporation does business in other states, must register with them.

So if corporation does business in 10 states, not including GA, there are 10 added
registrations with those secretaries of state and 11 corporate tax returns to be filed.

What a can of worms, eh?