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News & Tips

Here you can read up on significant developments in the world of sales and use tax. Find the latest legislative updates and helpful tips to keep you in compliance across all 50 states. You can filter news items by topic and/or a jurisdiction of interest.

Michigan Court Reinforces Strict Invoice Requirements for Labor Exemptions

A Michigan Court of Appeals decision confirms that businesses claiming sales tax exemptions for labor must properly itemize exempt labor charges on invoices and keep adequate records. The ruling highlights heightened audit risk when documentation is incomplete or invoice detail is missing.

Missouri Clarifies Sales Tax Treatment for Ice Sold in Vending Machines

A Missouri Department of Revenue letter ruling explains how bulk and bagged ice sold through vending machines is taxed, including the special vending-machine sales tax basis and sourcing rules. Learn what ice sellers and vending operators need to know.

Texas Court Rules Reusable Chemical Containers are Tax Exempt in Manufacturing

A Texas appeals court held that reusable chemical containers, plus related cleaning, delivery, and pickup services, can qualify for the manufacturing exemption from sales and use tax. The ruling offers important guidance for manufacturers using returnable containers in production and distribution.

Kentucky Removes 200 Transaction Count from Nexus Consideration

Effective August 1, 2026, the Kentucky nexus threshold will change from either 200 transactions or $100,000 in gross sales to only $100,000 in gross sales.

Utah Enacts New 2% Excise Tax on Digital Content

Utah has enacted a new 2% sales‑based excise tax imposed on the sales price of certain digital transactions.

Illinois Lease Tax Change Raises Concerns Over Double Taxation

Illinois’ new tax on lease receipts took effect Jan. 1, 2025, but the law does not provide transition relief for property already taxed when purchased for lease. That creates potential double taxation on pre-2025 lease contracts and raises major concerns for lessors and lessees.

Alabama to Temporarily Eliminate State Sales Tax on Groceries

Starting May 1 through June 30, 2026, Alabama will temporarily remove the state sales tax on most food items. The temporary tax break comes as part of Act 2026-604, which removes the state sales and use tax on qualifying food…

Utah Enacts Sales Tax Exemption for Sales of Food and Food Ingredients or Prepared Food by Home Cooks

Effective July 1, 2026, Utah has enacted a state sales tax exemption for sales of food and food ingredients or prepared food sold by a home cook, including home food products sold at a direct-to-sale farmers market or direct-to-sale location.…

Colorado Amends Rules for Sales Tax Return Filing Frequency Basis

Colorado has amended its sales tax filing-frequency rules, including updated thresholds that allow some retailers collecting less tax each month to file less often. Learn what changed, when the new rules apply, and how the update affects monthly, quarterly, and annual filers.

South Carolina Holds that Amazon Owes Tax on Pre-Wayfair Third Party Sales

A judge has held that Amazon owes uncollected taxes, penalties, and interest on third-party sales made pre-Wayfair.

Ohio Supreme Court Upholds CAT Assessment on Contract Manufacturer

The Ohio Supreme Court upheld a Commercial Activity Tax assessment against a contract manufacturer, ruling that receipts were properly sitused to Ohio when goods were shipped to an Ohio distribution center before later resale and shipment out of state. The decision offers important guidance on CAT sourcing and refund claims.

Washington Announces Temporary Penalty Relief Program for Tax Changes due to S.B. 5814

Washington’s Department of Revenue is offering temporary penalty relief for businesses affected by ESSB 5814, which made certain services newly subject to retail sales tax beginning Oct. 1, 2025. The program can waive penalties for qualifying unpaid or uncollected tax tied to those changes.

Washington Appeals Court Rules Gas Does Not Need to Physically Touch Products to Qualify for Exemption

A Washington Court of Appeals decision held that natural gas used in semiconductor manufacturing can qualify for a tax exemption even without direct physical contact with the product. The ruling clarifies how Washington interprets the gases-and-chemicals exemption and could affect other manufacturers claiming similar relief.

Washington Court of Appeals Ruling Clarifies Sourcing of Legal Services

A Washington Court of Appeals decision clarifies that legal-service receipts for B&O tax apportionment must be sourced to where the client receives the benefit of the work, not simply the billing address. The ruling has important implications for law firms, multistate service providers, and audit risk.

Wisconsin Court Holds StubHub is Required to Pay Sales Tax and Subject to Negligence Penalty

A Wisconsin Court of Appeals decision held that StubHub is liable for sales tax on ticket resales and is also subject to a negligence penalty for failing to pay it. The ruling has important implications for ticket marketplaces and other online platforms facilitating taxable transactions.

Wyoming Supreme Court Rejects Sales Tax Exemption for Oil & Gas Company

The Wyoming Supreme Court reversed a refund decision and held that electricity used in oilfield operations does not qualify for the “transportation business” sales tax exemption. Key takeaways for oil & gas taxpayers seeking sales/use tax refunds on utilities and field equipment.

New York Court Clarifies Sales Tax Treatment of Vehicle Leases with a Terminal Rental Adjustment Clause

A New York Tax Appeals Tribunal decision explains that sales tax on motor vehicle leases is due at lease inception (as a transaction tax), and lessors generally can’t claim sales tax credits for end-of-lease TRAC adjustments and lessee refunds. Key takeaways for fleet lessors and leasing companies.

Illinois Denies Manufacturing Exemption for Renewable Natural Gas Facility

An Illinois private letter ruling (ST 25-0008-PLR) concludes that equipment used to clean and upgrade landfill gas into pipeline-quality renewable natural gas does not qualify for the manufacturing machinery and equipment exemption because it is treated as taxable gas treatment delivered through pipelines.

Self-Storage Rentals and Leases Are Taxable as Services in Washington, Effective April 1, 2026

Beginning April 1, 2026, Washington will treat self-service storage unit rentals as a taxable service for B&O tax (Service & Other Activities). The Department also clarifies that businesses generally do not collect retail sales tax on the storage rental/lease charge—plus how related retail sales (boxes, locks, etc.) are taxed.

New York Authorizes Electronic Signatures for Power of Attorney Representatives

New York now allows electronic signatures on tax powers of attorney, making it easier for taxpayers to authorize representation and manage audits.

California’s New Battery Recycling Law Takes Effect January 1, 2026

Beginning January 1, 2026, California will impose a point‑of‑sale fee on covered battery‑embedded products under Senate Bill 1215. Retailers and manufacturers must register, collect, and remit the new Covered Battery‑Embedded (CBE) Waste Recycling Fee. Learn what qualifies and how to comply.

North Carolina Issues Guidance on Tax Impact of Rounding Cash Transactions Due to Suspension of Penny Production

North Carolina’s Department of Revenue issues guidance on how retailers should apply sales tax rounding rules for cash transactions following the suspension of penny production, including when and how to round totals to the nearest five cents.

Maine Revises Sales and Use Tax Guide and Bulletin on Exempt Organizations and Government Agencies

Maine Revenue Services has updated the Sales & Use Tax Guide and Instructional Bulletin No. 36 on exempt organizations and government agencies, clarifying tax exemptions and compliance requirements for nonprofits, schools, hospitals, and government entities.

Food and Beverage Sales at Career Center Are Exempt from Missouri Sales Tax

A Missouri letter ruling confirms that food and beverage sales at a vocational career center are exempt from state sales tax when sold by or for the benefit of the nonprofit educational institution. Learn the criteria and key takeaways for similar organizations.