Massachusetts law states that a lessor must continue to make monthly sales tax payments on an accrual basis on a lease as payments become due, even if the lessee fails to make payments to the lessor. However, the commissioner of revenue has released a letter ruling that says when a lessee defaults and a reduced settlement agreement is established between the lessor and the lessee, tax is due only on the modified number of payments established. (Letter Ruling 03-7, August 5, 2003.)