In a recent Letter of Findings, the Indiana Department of Revenue stated that all software maintenance agreements and optional warranties are subject to sales and use taxes, unless proven otherwise by the taxpayer. The Department acknowledged that in the past, optional warranties were not taxable if there was a possibility that no tangible personal property would be transferred, but “computer technology and use has evolved” and that almost all optional warranties on computer software now included regular updates which, therefore, qualify as taxable tangible personal property (Letter of Findings No. 05-0438, Indiana Department of Revenue, November 2006)