In Hunt-Wesson, Inc. v. Franchise Tax Board of California (2000) 528 U.S. 458, the Supreme Court rejected FTB's attempt to extend the theory in order to deny interest expense deductions incurred with respect to a nonunitary business operation. The Court found that the effect was to assess a tax upon constitutionally protected nonunitary income. (Id. at p. 466.) Failing to make a reasonable allocation of expense deductions to the income that the expense generates was held to constitute impermissible taxation of income outside of our state's jurisdictional reach. (Id. at p. 468.) The High Courtdid not, however, reject reasonable efforts properly to allocate a deduction between taxable and tax-exempt income (id. at p. 466), and it specifically noted with approval both federal and state use of ratio-based formulas to allocate borrowing (id. at p. 467.) The Court did not disapprove the concept of fungibility of money, but rather rejected an absolutist application that pushes this concept beyond reasonable bounds. (Id. at p. 466.) In that case, the taxpayer challenged as unconstitutional the State of California's limitation of a deduction allowed under its tax code. Under the provision at issue in that case, California a unitary or combined-reporting state allowed a corporate taxpayer to deduct interest expenses to the extent that the interest expense exceeded other, unrelated income, e.g., income that did not arise out of the taxpayer's activities in California. (528 U.S. at 461-62.) The Supreme Court concluded that, under the facts of that case, the limitation on the deductibility of interest expenses was not a true limit on a deduction but was instead more in the nature of an impermissible tax. The Supreme Court noted that had California demonstrated that the limitation "reflected the portion of the expense properly related to nonunitary income, the limit would not, in fact, be a tax on nonunitary income" but would instead be a "proper allocation of the deduction." (528 U.S. at 465.) The Supreme Court held that the provision at issue was "not a reasonable allocation of expense deductions to the income that the expense generated," and, therefore, it concluded that the provision violated the Due Process Clause and the Commerce Clause. (Hunt-Wesson, Inc. v. Franchise Tax Bd. of California, 528 U.S. at 468.)