By Ted Friedman and Timothy Gustafson

The Supreme Court of Missouri reversed and remanded a decision of the Administrative Hearing Commission (see our coverage of the Commission’s January 28, 2013 decision here) and held that income from a “rabbi trust”—a trust established by a corporation to fund a nonqualified deferred compensation plan for company

By Zachary Atkins and Prentiss Willson

The Missouri Department of Revenue issued a letter ruling in which it determined that the sale or rental of streaming video content is not subject to Missouri sales or use tax. The service in question allowed customers to purchase or rent video content and to stream the content through

By Shane Lord and Prentiss Willson

The Missouri Administrative Hearing Commission held that a telephone company’s interest income received from its parent company was passive, non-Missouri source income and thus excludible from apportionable income as nonbusiness income. The interest income at issue was related to a note between the taxpayer and its parent company pursuant

By Sahang-Hee Hahn and Jack Trachtenberg

The Missouri Department of Revenue determined that an out-of-state provider of mail systems products had nexus for sales and use tax purposes due to the selling activities of dealers in the state. The taxpayer sold products that enabled customers to centralize the distribution and collection of their mail and

By Jessica Kerner and Jack Trachtenberg

The Missouri Department of Revenue determined that a company’s telecommunications services provided to customers on its cloud computer network are subject to sales tax. The company’s cloud network is hosted on servers located outside of the state, and customers access the network through public telecommunications lines and through the

By Madison Barnett and Timothy Gustafson

The Missouri Administrative Hearing Commission ruled that interest income and capital gains generated by a “rabbi trust”—a trust established to fund a nonqualified deferred compensation plan for the taxpayer’s officers—constituted nonbusiness income under the Uniform Division of Income for Tax Purposes Act (UDITPA). The trust income failed the transactional

We recently launched the Sutherland SALT Digital Economy Forum, which provides comprehensive state tax resources regarding the taxation of the digital economy. Following is a summary of recent digital economy administrative guidance, noteworthy cases and legislation. If you would like to learn more about the Sutherland SALT Digital Economy Forum or any of the issues covered here, please contact us.

Sales, Use and Other Transaction Taxes

Administrative Guidance

  • Massachusetts Soliciting Comments on Software Directive. On February 7, the Massachusetts Department of Revenue issued a draft directive that addresses the application of the Massachusetts sales and use tax to sales of software and computer-related services.
  • Wisconsin Updates Guidance Regarding the Sales and Use Tax Treatment of Computer Hardware, Software, and Services; Addresses Cloud Computing. On January 25, 2013, the Wisconsin Department of Revenue (DOR) updated its software guidance for sales occurring on and after October 1, 2009. While the taxability conclusions and destination-based sourcing regime remain largely unchanged, the DOR expressly addressed software as a service (SaaS), platform as a service (PaaS), and infrastructure as a service (IaaS).
  • Missouri DOR: Computer Software May Not Be Eligible for Manufacturing Exemption. The Missouri Department of Revenue (DOR) recently determined that a company’s software programs were not eligible for the manufacturing equipment exemptions from sales and use tax because the software was not directly used in the manufacturing process.

Continue Reading Digital Economy Update: Administrative Guidance, Noteworthy Cases and Legislation

The Missouri Department of Revenue (Department) issued guidance stating that gift certificates sold below face value by a radio station, which are redeemable for goods and services purchased at local retailers, are not subject to sales tax. Although the primary determination is not noteworthy, the private letter ruling further stated that the retailers receiving the