The concepts of unitary groups and combined reporting allow for States to tax the income of an entity that does not have nexus with the State. States assert that this is a mechanism to prevent taxpayers from distorting business income by locating profitable operations in low tax jurisdictions, and low profit or loss making activities in high income states. For example, locating Marketing and Legal services in a separate legal entity with no income in State A and only nexus in State A, while locating profitable sales operations in State B (with no nexus in State A) that does not have corporate income tax. Do you think this is fair to taxpayers? Should States be allowed to disregard the legal structure of a business? Be sure to explain, why or why not.