- Recent New York administrative decisions show reluctance to apply primary function test to bundled sale of software or SaaS with nontaxable services
- Businesses need to be aware of sales tax ramifications based on how they market software/SaaS and other services
- Aprio’s State and Local Tax (SALT) team can help address taxability issues on software and SaaS services
- Two sales tax rulings in New York solidify state’s stance on bundled transactions involving software and nontaxable services
- New York treats entire sale price as subject to sales tax if software license is nonincidental part of transaction
- Cases of Beeline.com, Inc. and FacilitySource, LLC illustrate application of sales tax to bundled transactions involving software and services
- FacilitySource case involved facilities management services treated as taxable sales of prewritten software
- Receipts from license to use prewritten software are considered taxable sale of tangible personal property in New York
Source: aprio.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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