1. (a) The denominator of the property factor is the average value of all of the taxpayer's real and tangible personal property owned or rented and used during the tax year, as defined in AS 43.19.010 (Art. IV, secs. 10 - 12), 15 AAC 19.141, 15 AAC 19.151, and 15 AAC 19.181 - 15 AAC 19.202. In addition, the denominator of the property factor must include the average monthly total of the taxpayer's loans receivable, accounts receivable, and assets having the nature of loans or accounts receivable.
2. (b) The numerator of the property factor is the average value of the taxpayer's real and tangible personal property owned or rented and used in this state during the tax year, as defined in AS 43.19.010 (Art. IV, secs. 10 - 12) and 15 AAC 19.171. In addition, the numerator of the property factor must include the average monthly total of the taxpayer's loans receivable, accounts receivable, and assets having the nature of loans and accounts receivable, sourced to Alaska.
3. (c) For purposes of this section, tangible property, including property leased to or from other parties, is located in Alaska and must be attributed to the state if it is physically situated in the state during the taxable period. If the property is mobile property such as motor vehicles, rolling stock, aircraft and vessels, its value must be determined in accordance with AS 43.20.143 and 15 AAC 19.171(c). The value of mobile property other than land transportation equipment, aircraft and vessels must be determined by using the ratio of time spent in the state during the taxable period to time spent in all taxing jurisdictions.
4. (d) The denominator of the payroll factor is the total compensation paid everywhere by the taxpayer during the tax period, as defined in AS 43.19.010 (Art. IV, secs. 13 and 14), 15 AAC 19.211, and 15 AAC 19.221.
5. (e) The numerator of the payroll factor is the total amount paid by the taxpayer during the tax period for compensation in the state, as defined in AS 43.19.010 (Art. IV, sec. 14), 15 AAC 19.231, and 15 AAC 19.241.
6. (f) The denominator of the sales factor includes all receipts derived from transactions and activities in the course of the taxpayer's business as defined in AS 43.19.010 (Art. IV, secs. 15 - 17), 15 AAC 19.251, 15 AAC 19.261 and 15 AAC 19.302, but excludes tax-exempt income.

7. (g) The numerator of the sales factor includes all receipts derived from transactions and activities in the course of the taxpayer's business in the state, as defined in AS 43.19.010 (Art. IV, secs. 16 and 17) and 15 AAC 19.271 - 15 AAC 19.302, but excludes tax-exempt income. The numerator of the sales factor must include

   1. (1) interest, fees, charges, rents, and compensation for services performed when these amounts are derived from loans or assets in the nature of loans sourced to Alaska;
   2. (2) gross receipts from services, including trustee, fiduciary, checking account, and bill-paying services, and gross receipts from the use of facilities, including safe deposit box and cash machine transaction fees, if the service is performed in Alaska or if the facility is located in Alaska; if the service is performed partly inside and partly outside the state, the gross receipts that are attributed to Alaska must be determined by the ratio that the time spent in performing the service in the state bears to the total time spent in performing the service everywhere;
   3. (3) receipts from other securities and investments, if the securities and investments are managed from a location in the state;
   4. (4) receipts, including fees and charges, from the issuance of traveler's checks and other negotiable instruments if the negotiable instruments are sold or issued in Alaska;
   5. (5) gross receipts from the operation or management of repossessed real property located in Alaska and personal property if the property is sourced to Alaska.
8. (h) If receipts from intangible property cannot be readily attributed to a particular taxing jurisdiction, the receipts may not be assigned to the numerator of the sales factor for any state and must be excluded from the denominator of the sales factor.
9. (i) Personal property in the nature of loans or receivables and receipts from loans or receivables must be sourced to the state if the borrower or cardholder resides in the state. If, in regard to loans, property or receipts are not sourced to the state and are excluded from the property or sales factor by the taxpayer, the department will, in its discretion, attribute the property or the receipts to the state, if the exclusion inaccurately reflects the extent of the taxpayer's activities in the state and if the property pledged as security for the loan is located in the state.

(Eff. 2/17/85, Register 93)

Authority: AS 43.05.080