The sales taxation of software has long been controversial. When sales of software became commonplace in the 1970s and 1980s, it was largely available and commercially distributed on a tangible medium. Today, software is provided in ways that do not constitute the transfer of title or possession of tangible personal property, such as the Software-as-a-service (SaaS) distribution model.
While only a few states explicitly tax SaaS or digital automated services as enumerated services, tax administrators may still attempt to tax them.
In this installment of A Pinch of SALT in Tax Notes State, Eversheds Sutherland attorneys Michele Borens, Cyavash Ahmadi, and Meriem El-Khattabi explore recent administrative actions and judicial, tax tribunal, and legislative responses to the evolving provision of software.
Read the full article here.