Shaking things up in state and local tax
Shaking things up in state and local tax
The Illinois Department of Revenue (IDOR) released a general information letter outlining the applicability of Illinois Retailers’ Occupation Tax (ROT) on computer software licenses and maintenance agreements.
The letter states that sales of “canned” computer software are taxable retail sales in Illinois and are considered to be tangible personal property regardless of the form in…
An administrative law judge at the New York Division of Tax Appeals found that a company’s vendor management fees were taxable as the sale of pre-written software. The company offers a web-based application that helps to manage and procure staffing services from requisition through billing. The company argued that its fees are not taxable because…
On August 31, 2022, the California Office of Tax Appeals (“OTA”), in the Matter of the Appeal of B. Housman and B. Pena, held that an Australian software company holder, Housman, and his wife are California residents and Housman is entitled to a stepped-up basis as a result of a valid check-the-box election to be…
On October 15, 2022, the Utah State Tax Commission published a proposed amendment to its rule governing the taxation of custom software for sales and use tax purposes, clarifying that the sale, rental or lease of custom computer software constitutes a sale of personal services that is not subject to tax, regardless of the form…
On September 29, 2022, the New York State Division of Tax Appeals determined that services involving the creation of customer engagement reports based on email tracking and email template usage data are nontaxable information services—particularly when use of software is only incidental to the performance of such services. The taxpayer sold “customer engagement services” to…
On April 25, the Washington Court of Appeals held that a company that arranges and manages displays for installation and placement in multiple retail brands’ stores through subcontractors was subject to the state’s retailing business and occupation tax (the “B&O tax”) and retail sales tax as a retailer making retail sales, rather than a provider…
On September 20th, the Los Angeles County Superior Court held that local video service provider fees do not apply to streaming video providers. This decision is consistent with a prior decision by the United States District Court for the District of Nevada, which held that streaming video providers were not subject to Nevada localities’ franchise…
On September 3, 2021, the United States District Court for the District of Nevada held that streaming video providers were not subject to Nevada localities’ franchise fees. The city of Reno filed a class action lawsuit against two streaming video providers, claiming that they were required to register as video service providers (i.e., obtain a…
The Washington Department of Revenue recently released informal guidance regarding the taxability of online instructional classes. The guidance states that live classes where participants can interact in real-time with the presenter are not subject to sales tax; however, pre-recorded videos and classes are subject to sales tax. This distinction focuses on the live ability to…
On July 8, 2021, the Michigan Court of Appeals issued a decision holding that a retailer was not subject to use tax on advertising materials mailed to Michigan residents. The retailer designed the materials in-house and had them printed by a third-party printer, outside of Michigan. After printing, the retailer sent the materials to a…
