- Businesses spend a lot of money on software licenses, but often overlook the potential tax implications.
- Sales tax rules around software are complex, especially with the rise of electronic downloads and cloud-based services.
- However, some states offer exemptions for business-to-business (B2B) software, and a handful of states have Multiple Points of Use (MPU) rules that allow companies to pay tax based on proportional utilization in each applicable state.
- Massachusetts, Minnesota, Ohio, and Washington are among the states that recognize MPU exemptions.
- Companies with multiple locations and remote workers can benefit from this exemption, but it’s important to follow the specific rules and guidelines for each state.
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