The New York Division of Tax Appeals determined that a multilevel marketing company’s provision of access to its web-based software that contains confidential and proprietary information and reports for use in developing business was neither the taxable sale of prewritten computer software, nor the sale of a taxable information service. The company, a multilevel marketing company, sells health and beauty products directly to end customers via e-commerce through its distributors and independent sales agents. The distributors paid a subscription fee to have access to a web-based software service that provided various personalized commission and transaction reports, reports regarding how their downline sellers were performing, as well as additional information, including access to a mobile application. The Department of Taxation and Finance assessed sales tax against the company, asserting that receipts from subscriptions to the web-based software was the taxable sale of prewritten computer software and that the furnishing of the information reports constituted the sale of a taxable information service. The ALJ applied the primary function analysis in concluding that the primary function of the subscription was the generation of confidential financial reports rather than the taxable sale of prewritten computer software. The ALJ also determined that the subscription sales were not the sale of a taxable information service because the confidential information provided in the reports was personal or individual in nature which would not be substantially incorporated in reports furnished to others, and thus qualified for the exclusion from tax on information services.