Bubbles, Inc. (Bubbles) is a Delaware corporation headquartered in CA. Bubbles is a mortgage lender specializing in subprime home loans. Bubbles issues and services loans to consumers across the country, including OR. In addition to promoting its business via web advertising, mail and telephone solicitations, Bubbles' employees physically inspect the properties of potential homebuyers to estimate the property values. Bubbles holds mortgages on Oregon properties of $50 million. Its total mortgages on all properties are $500 million.

OR has assessed a net income tax against Bubbles based on its activities in the State. For financial organizations like Bubbles, assume that the amount of net income subject to tax in ORis determined based on the taxpayer's mortgages on ORproperties as a percentage of mortgages on properties everywhere. The net income tax apportionment methodology applies equally to in-state and out-of-state corporations.

Which prong of Complete Auto's 4-prong test is relevant in determining if the amount of Bubbles' net income subject to tax in Oregon is supportable under the Commerce Clause?

Answer rating: 100% (QA)

In determining if the amount of Bubbles net income subject to tax in Oregon is supportable un... View the full answer