To help those with business operations in the Mid-Atlantic or those who make sales into Mid-Atlantic states keep up, we’re putting a magnifying glass on some of the key recent sales tax changes.
Utah Legislation Updates Peer-to-Peer Car-Sharing Regulations
A recently enacted Utah bill changes how motor vehicles involved in car-sharing platforms are taxed.
Mississippi Imposes Tax on Computer Software with Exemption for Out-of-State Storage
Mississippi Governor Tate Reeves signed S.B. 2449 into law on March 28, requiring sales and use tax to be charged on computer software and services. This law also entails an exemption for any software that is stored outside the state. The law goes into effect on July 1, 2023.
Washington Finds Utilities Meter Data Management Service to be Exempt
A Washington appellate court has ruled against the state Department of Revenue and a lower court\’s summary judgement, and ruled in favor of a company that collects and transmits data for Washington-based power companies.
Federal Contractor Required to Pay Washington Use Tax on Design and Engineering Costs Associated with Government Contract
The Court of Appeals of Washington determined that Alstom Power Inc. was required to pay Washington use tax for a turbine rehabilitation project.
Collection and Remittance of Tax on Credit Rating Services for Legal Entities Begins July 1, 2023 in Texas
The Texas Comptroller of Public Accounts has issued a policy letter stating that the provision of credit rating services for legal entities is subject to sales and use tax, and taxpayers must begin collecting and remitting tax on these services beginning July 1, 2023.
Tennessee Passes Legislation Regarding Taxing Temporary Services
Companies doing business in Tennessee and seeking the aid of temporary workers should carefully review job postings, with the understanding that other than this in-house exemption, the services of individuals related to software may be taxed.
North Carolina Issues Guidance on Dry-Cleaning Solvent Tax
North Carolina imposes a privilege tax on dry-cleaning solvent retailers at a flat rate for each gallon of dry-cleaning solvent sold to a dry-cleaning facility. An excise tax is imposed on dry-cleaning solvent purchased for storage, use, or consumption by a dry-cleaning facility in North Carolina.
Sweepstakes are Taxable Amusement Service, Texas Court Rules
After the state comptroller of public accounts audited Sidetracked Bar for periods between July 2011 and December 2017, the comptroller’s office assessed sales tax, penalties, and interest, totaling about $400,000, which Sidetracked paid under protest.
Landscaping Services Provided by Construction Company Subject to Tax in Arkansas
In a request for revision, the Arkansas commissioner of revenue affirmed an administrative law judge’s determination that a construction company was required to collect and remit sales tax on landscaping work that it performed.
Minnesota Releases Guidance about Services Necessary to Complete a Sale
The state of Minnesota has issued a revenue notice clarifying the department\’s position on services considered to be necessary to complete a sale, which are included in the sales price of a taxable transaction.
Minnesota Tax Department Clarifies Inclusion of Services in Sales Tax
The Minnesota Tax Department has released Revenue Notice 22-04, which clarifies the taxability of services.
Georgia Tax Tribunal Orders Uber To Charge Tax On Safe Rider Fee, Pay Uncollected Taxes
The Georgia Tax Tribunal issued a pair of orders in the case of Uber Technologies Inc. v. Crittenden, determining that Uber underpaid its sales tax liability by several million dollars by not including its Safe Rider Fee in its taxable basis.
Maryland Enacts New Tax on Digital Advertising
The Maryland legislature overrode Governor Larry Hogan’s veto of a new tax on digital advertising (H.B. 732) on February 12, 2021, making Maryland the first state in the country to adopt a tax on digital advertising.
Mississippi Supreme Court Rules That Digital Photos are Exempt from Sales Tax
The Mississippi Supreme Court (Court) has affirmed a lower court’s decision, ruling that a wedding photographer was not liable for a sales tax assessment issued by the Mississippi Department of Revenue (DOR).
Kentucky Releases Detailed Guidance on the Applicability of Upcoming Changes to Taxable Services for Impacted Industries
Following the passage of House Bill 8 this spring, as of January 1st, 2023, many services that were not subject to sales tax in Kentucky will become taxable.
Texas rules payment card management program is a nontaxable payment processing service
A private letter ruling by the Texas Comptroller of Public Accounts found in favor of a taxpayer, defining its payment card management (PCM) program as a nontaxable payment processing service, not a taxable data processing service.
Online learning courses ruled nontaxable in Texas
Subscriptions to online learning services are not taxable in the state of Texas, according to a July ruling in a private letter published by the state comptroller, but planning services purchased by teachers are subject to tax.
Service Providers: Don’t Assume You Are Always Tax-Free!
Service providers—especially in the professional services realm—can be quick to assume that their services are nontaxable and that they do not need to collect sales tax and remit sales tax on their sales of services.
Ohio Supreme Court Upholds Sales Tax Refund for Computerized Services
The Ohio Board of Tax Appeals (BTA) uses the true object test to distinguish between nontaxable custom software or taxable services.
Texas Rules Loan Document Packages Subject to Sales Tax
The Texas Court of Appeals ruled that a law firm’s purchases of packages containing the legal documents necessary to execute residential mortgage loans should be classified as purchases of data processing services, which is subject to sales tax.
New York Advertising Analysis Service Provider to Collect Sales Tax
A New York company that helps clients measure the effectiveness of advertising efforts is considered an information services provider.
Service Providers: Are you Making This Big Sales Tax Mistake?
If you’re a service provider selling goods along with non-taxable services, you may be making one simple but big mistake that can create a sales tax burden for your business.
Florida Released Publication on P2P Car Sharing Rentals
Effective January 1, 2022, Florida peer-to-peer car-sharing programs are subject to collecting and remitting the applicable taxes.