Tito’s Vodka Maker Had Enough Nexus With Maine to Owe Income Tax

Austin-based Fifth Generation Inc., which makes Tito’s Vodka, owes nearly $750,000 in Maine income taxes because selling liquor into the state created sufficient business connections there, the state high court ruled Thursday.

The company argued its limited business in the state is protected from Maine income taxation by Public Law 86-272. That’s the federal statute that prohibits states from imposing income taxes on out-of-state businesses that only solicit sales of tangible personal property in the state.

But Fifth Generation’s storage of a 60-day liquor supply in state-run bailment warehouses before the spirits could be sold to retailers—as required by state ...