- Kentucky imposes sales and use tax on prewritten computer software, including AI-enabled software, regardless of delivery method.
- Remote access to prewritten software (such as SaaS) is also taxable.
- AI incorporation does not change the software’s taxable status unless the software is customized for the customer.
- Customization must be specifically indicated on the invoice for tax exemption.
- Non-customized AI-supported software is always taxable in Kentucky.
Source: 1stopvat.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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