Software/Hi-Tech

Sales Tax FAQs

Explore commonly asked questions about sales and use tax. A great starting place to learn about fundamental sales tax concepts and general applications to business.

Delivery Method Changes Everything: Navigating Sales Tax on Intangible Goods

Explore cases where seemingly intangible goods can be converted to tangible personal property for sales tax purposes.

Cloud & Software Taxation After South Dakota v. Wayfair

States have been tackling taxation of software and the cloud for quite some time and this trend has continued post-South Dakota v. Wayfair. In fact, a number of major pieces of legislation have become effective post-Wayfair across the states. Let’s…

Midwest State Tax Updates You May Have Missed

In sales tax, legislative updates and law changes are a constant. It is virtually impossible to keep up with all of the changes taking place in the states where you conduct business, especially if there are more than one. But…

The Internet of Things: What Is It and How Should It Be Taxed?

The Internet of Things can be summed up as a network of “intelligent,” connected devices that generate data for automating business processes and enabling new services.

Software Exemptions That You Might Not Think Of

In this blog post, we discuss three different types of software exemptions that may be available in some states.

Helpful Links

We’ve gathered some websites that may be helpful in finding answers to your sales tax questions or addressing your sales tax needs.

Tax Software

Find tax software providers that handle tax compliance, calculation and other sales tax issues. These providers offer a range of sales and use tax related services, including exemption certificate management, rate lookup tools, and more.

Chicago Updates Cloud and Software Lease for Release Rule

Chicago modified its application of the lease for re-lease exemption to include certain software and cloud products, effective July 1, 2020.

Software Subscription Services Subject to Tax in South Carolina

South Carolina has issued a private letter ruling regarding the application of sales and use tax to a cloud-based software subscription service.

Online Software Subscription Fees Taxable in Massachusetts

Massachusetts found that a taxpayer’s subscription fees for online software products are subject to sales tax as sales of tangible personal property.

Sales and Installation of Computer Cabling Are Exempt in Ohio

Effective October 22, 2019, sales and installation of computer cabling are exempt from Ohio sales and use tax but the contractor owes use tax on the cost of the materials installed into real property.

Utah Repeals Legislation that Expanded Taxation to Specified Services, Repealed and Created Exemptions

Effective January 29, 2020, Utah enacted legislation that repeals previously enacted legislation, S.B. 2001, that included expansion of taxability to specified services, the elimination of sales tax exemptions, the creation of new sales tax exemptions, and more.

Video Streaming Services Subject to Tax in Kentucky

Effective July 1, 2019, video streaming services are subject to Kentucky excise tax and gross receipts taxes as taxable “multichannel video programming services.”

Chicago Increases Personal Property Lease Transaction Tax, Effective January 1, 2020

Effective January 1, 2020, Chicago’s Personal Property Lease Transaction Tax increases from 5.25% to 7.25% on charges for cloud services.

Point-of-Sale Services Subject to Washington Sales and Use Tax

The purchase of point-of-sale (POS) services by a taxpayer was subject to Washington sales and use tax as taxable digital automated services.

District of Columbia Repeals Sales Tax Exemption for Qualified High Technology Companies

Effective October 1, 2019, D.C. has repealed two sales and use tax exemptions for purchases and sales by Qualified High Technology Companies.

Washington Issues Guidance on Taxability of Bitcoin-Related Activities

The Washington Department of Revenue has issued a statement regarding the taxability of bitcoin-related activities.

Connecticut Increases Tax Rate on Most Digital Goods and Certain Software

The sales and use tax rate on digital goods and certain software will increase to 6.35%, effective October 1, 2019.

North Carolina Expands Applicability of Sales Tax to Digital Property

Effective October 1, 2019, North Carolina enacted legislation that expands the applicability of sales tax to digital property.

Mississippi Amends and Creates Data Center Exemptions

Effective July 1, 2019, Mississippi has enacted legislation that amends and creates sales and use tax exemptions for data centers.

Alabama Supreme Court Holds That All Computer Software is Taxable

The Alabama Supreme Court held that all software, including custom software created for a particular user, is “tangible personal property” and therefore taxable.

Online Subscription-Based Educational Curriculum Not Taxable in Texas

Sales of an online subscription-based educational curriculum were exempt from Texas sales and use tax since the curriculum is primarily instructional in nature.

Software Maintenance Services Not Subject to Colorado Sales and Use Tax

A company’s charges for computer program maintenance services were not subject to Colorado sales or use taxes.