.05 Allocation of Nonresident Business Income.

A. Income of a nonresident for personal services rendered partly within and partly without this State shall be determined as follows:

(1) Commissions of a traveling salesman or agent which depend directly on sales made are allocated outside this State if the:

(a) Sales are outside this State, or

(b) Merchandise is delivered to points outside this State;

(2) Compensation other than commissions which depend directly on sales made for service performed partly within and partly outside this State shall be allocated based on the total number of working days employed outside this State compared to all working days employed both within and outside this State.

B. Nonbusiness income derived from interest, dividends, and annuities is allocable to the nonresident's state of domicile and not to this State.

C. Income from a business, trade, profession, or occupation carried on partly within and partly outside this State shall be determined by separate accounting when practicable. If separate accounting is not practicable, income allocable outside this State shall be determined by:

(1) Percentage allocation which is:

(a) The average value of tangible business property outside this State over the average value of all tangible business property multiplied by 100,

(b) Business income outside this State over total business income multiplied by 100,

(c) The average of the percentages determined in §C(1)(a) and (b) of this regulation, and

(d) The average percentage arrived at in §C(1)(c) of this regulation applied to total business income to arrive at income allocable outside this State;

(2) Apportionment of sales as described in COMAR 03.04.03.08; or

(3) A method or methods subject to approval by the Comptroller.