- Massachusetts allows a multiple points of use (MPU) exemption for qualifying software, so tax can be allocated based on where employees actually use the software rather than sourcing 100% to Massachusetts.
- Iron Mountain had historically paid Massachusetts sales tax on the full amount of certain software purchases, creating potential overpayments as its workforce became more distributed.
- A review identified about $14 million in Massachusetts sales tax paid on relevant software purchases, with roughly $12 million eligible for recovery based on employee-location apportionment.
- Recovering the tax required vendor-by-vendor refund claims across about 22 software vendors, using amended returns or state refund authorization.
- The company also updated its forward-looking tax treatment so software purchases can be taxed and accrued in the jurisdictions where the software is actually used.
Source: dmainc.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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