Alaska Car Dealership Sale Can’t Reduce California Tax, OTA Says

Worthington Oil & Gas Corp. must exclude proceeds from the $53 million sale of subsidiary car dealerships in Alaska from its California tax return because the sale was both substantial and occasional, the California Office of Tax Appeals said in an opinion posted Monday.

A three-judge panel upheld the Franchise Tax Board’s determination that the company improperly included the proceeds in the formula used to apportion income to California for 2016. The numerator of the formula is made up of total sales in California, while the denominator is total sales everywhere. With the dealership sale included in the denominator, the ...