M.D.C. Holdings, Inc. v. State Ex Rel. Arizona Department of Revenue

OPINION

IRVINE, Judge.

¶ 1 This case arises out of Arizona’s Uniform Division of Income for Tax Purposes Act (“UDIPTA”), Arizona Revised Statutes (“A.R.S.”) sections 43-1131 to -1150 (2006 & Supp.2008). 1 M.D.C. Holdings, Inc. (“MDC”) claims that the Arizona Department of Revenue (the “Department”) improperly calculated the sales factor fraction of its corporate income tax apportionment formula for the 1996 tax year. We hold that the denominator of the sales factor should include only the net gains from the sales of mortgages and mortgage servicing rights. We further hold that, under the facts…