In a letter ruling, Kansas discusses the tax treatment of computer software maintenance agreements. The ruling is effective January 1, 2009 and replaces and supersedes all prior advice, revenue rulings, and other rulings that have been issued regarding this matter. Mandatory computer software agreements for canned (prewritten) software are treated as part of the software sale and, thus, subject to Kansas sales or use tax. Any separately-stated charges for technical support services are also taxable. Optional maintenance agreements, whether sold separately, by a third party, or in conjunction with the sale of canned (prewritten) software are characterized as 50% taxable software in a bundled transaction in which the taxable and nontaxable products are not separately itemized on the invoice or billing document. When charges for technical support are separately-stated or when the agreement clearly states that only technical support services will be furnished, such charges are not taxable. A charge for an upgrade from a “basic” to a “premium” maintenance agreement is not subject to sales tax if the agreement clearly states that the upgrade is for technical support services. If not, the upgrade will be taxable at 50%. Charges for upgrades and enhancements for canned software are taxable, whether separately-stated or not. Mandatory and optional maintenance agreements for custom software are not taxable. (Revenue Ruling 19-2009-01, Kansas Department of Revenue, June 2, 2009)