Presence of Independent Registered Representatives in Michigan Did Not Create Nexus
In Vestax Securities Corp. v. Department of Treasury, Michigan Supreme Court, No. 142535, June 1, 2011, the Supreme Court reversed the appellate court in lieu of granting leave to appeal. The Michigan Supreme Court ruled that the evidentiary record did not support the appellate court's determination that the independent registered representatives were the taxpayer's agents or that there existed a substantial nexus between Michigan and the taxpayer's business activities sufficient to impose the Single Business Tax.
The appellate court held that a corporation was subject to the SBT because sufficient nexus with Michigan was established by the physical presence in the state of independent registered representatives doing business as agents of the corporation acting on its behalf to solicit requests for securities transactions. Accordingly, the case was remanded so that summary disposition to the taxpayer could be reinstated.