Posts by Tina Chunn
South Carolina Rules that Optional Training Services are Taxable When Sold with Taxable Software
As this South Carolina ruling illustrates, whether software is subject to sales tax often depends on the manner by which the software is provided, and that determination can also impact the taxability of any services sold with the software. By: Tina M. Chunn, SALT Senior Manager From a sales tax perspective, whether a software license is taxable…
Read MoreFlorida Applies “Income Producing Activity” Rule to Source Service Revenue to Customer Location
The cost of performance rule for sourcing service revenue when calculating the sales factor of the apportionment formula generally assigns service revenue to the state(s) where the services are performed, but a number of states are narrowly interpreting those rules to create a market-based sourcing result. By Kristen Davis, SALT Associate For purposes of calculating…
Read MoreNew York Tax Appeals Tribunal Rules that Gift Card Promotion Does Not Reduce Sales Tax Value
The application of sales/use tax to a particular transaction often depends on the form in which that transaction is structured, and a business’s failure to respect that form may give rise to sales/use tax liability. By Tina M. Chunn, SALT Senior Manager When offering discounts and promotions, retailers may not always consider sales and use tax…
Read MoreAlabama Denies Refund of Composite Payments Not Claimed Within Statute of Limitations
Owners of pass-through entities should pay close attention to the taxes that are paid on their behalf by the pass-through entity, because failure to take credit for those payments in a timely manner may prevent a future refund claim. By Tina M. Chunn, SALT Senior Manager On Dec. 27, 2019, the Alabama Tax Tribunal issued a…
Read MoreGeorgia Addresses Sales of Services Versus Tangible Personal Property
When businesses provide tangible personal property in connection with the delivery of a service, states often engage in a fact-specific and subjective analysis to determine whether the transaction should be treated for sales tax purposes as a taxable sale/lease of property or an exempt sale of a service. By Tina M. Chunn, SALT Senior Manager One…
Read MoreTexas Rules That Tee Time Reservation App Is a Taxable Data Processing Service
A recent Texas decision ruled that the taxpayer’s tee time reservation app constituted taxable data processing services and that sales was tax due on the barter transaction with its golf course customers, highlighting the sales tax complications that can arise when a third party technology gets involved in transactions that were traditionally between a buyer…
Read MoreArkansas: Contractor May Purchase Exempt Solar Farm Equipment Without Sales Tax
Sales tax rules for manufacturing businesses differ among the states, particularly with regard to the exemption for manufacturing equipment, and as this Arkansas Revenue Legal Opinion highlights, the specific function of each piece of machinery and equipment can impact whether it qualifies for an exemption. By Tina M. Chunn, SALT Senior Manager Most states provide some…
Read MoreSouth Carolina Rules Data Collection and Analysis Services Using Online Reporting Software is Not a Taxable Communications Service
Sometimes states and taxpayers jump to the conclusion that if SaaS is provided, then the transaction is automatically taxable if the state taxes SaaS, but if the SaaS is provided as part of package of products/services, then it may be necessary to examine the true object of the transactions to determine taxability, as explained in…
Read MoreAlabama Supreme Court Holds That Custom Software Is Taxable
The Alabama Supreme Court ruled that custom software is taxable (reversing over 20 years of guidance from the state) and that certain software services may be nontaxable if separately stated. By Tina M. Chunn, SALT Senior Manager Software has often been a confusing product when determining whether sales tax will apply in each state, since taxability…
Read MoreLouisiana Denies Claim of Overpaid Sales Tax from Rewards Program Transactions
This Louisiana Court of Appeals decision highlights the sales tax impact of discounts, including rebates and coupons, which can vary depending on the type of discount and can be a trap for the unwary that results in exposure for collecting and remitting less sales tax than required. By Tina M. Chunn, SALT Senior Manager It has…
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