A recent Virginia ruling upheld a taxpayers’ tax assessment on the purchase of procurement software. The taxpayer contended that the software should be exempt as custom software or software delivered electronically. The Commissioners’ ruling against the taxpayer was based on evidence from the taxpayers’ website that stated the software was created to the specific needs of the federal procurement community. This statement suggests that the software was intended to be licensed to the taxpayer in order for it to be marketed to various federal government customers via sublicensing agreements. This does not coincide with the definition of custom software which must be specifically designed and created for only one customer. The taxpayer also did not provide any documentation to support the delivery method of the software. (Ruling of Commissioner, P.D. 08-134, Virginia Department of Taxation, July 30, 2008, 204-855)