Sale tax on BI Maintenance

SouthernYankee

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Why is there sales tax on Blue Iris Extended Support and Maintenance 1 year. This is a service and it should not be taxed. The original purchase of the software is taxable as it is a tangible asset.
 

SouthernYankee

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All states use the same laws for internet sales. That is why all hard good sales on the internet pay sales tax now.
 

biggen

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Florida does not require collection of sales tax for internet sales unless the buyer and business owner both are located in FL.

I stepped through trying to buy the BI support plan and I didn't see tax added onto my order. I didn't complete the purchase since I already have a support plan. I'd have to go back and check my Paypal receipt to see if I was charge tax when I purchased it previous.
 

SouthernYankee

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@biggen

So your purchase from amazon have no sales tax if there is not a warehouse in Florida ? If this is the case then Internet business will be move to the state with a small population like south Dakota
This is the way it use to be, but the rules have changed. All hard good purchases pay tax, no mater what state.
 

reflection

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<State> does not require collection of sales tax for internet sales unless the buyer and business owner both are located in <same state>.
Those were the good old days :). I remember those days....not too long ago....-sniff-
 

Sparky19053

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Why is there sales tax on Blue Iris Extended Support and Maintenance 1 year. This is a service and it should not be taxed. The original purchase of the software is taxable as it is a tangible asset.
I agree, no sales tax on services regardless of the state.
 

fenderman

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I agree, no sales tax on services regardless of the state.
A complication in categorizing the support plan as a service is that it includes updates. Furthermore, even if it was a service only it may be taxed in some states.
Many states have taxes on services particularly when those services are performed on tangible personal property. For example in NJ
"The New Jersey Sales and Use Tax Act imposes a tax on the receipts from every retail sale of tangible personal property, specified digital products, and the sale of certain services, except as otherwise provided in the Act. Tangible personal property can include prewritten computer software delivered electronically. In addition, most services performed on tangible personal property and specified digital products are taxable unless they are specifically exempted by law. Exempt items include most food sold as grocery items, most clothing and footwear, disposable paper products for household use, prescription drugs, and over-the-counter drugs. "

NY is different, a service alone is NOT taxable, "However, when these otherwise exempt services are provided in conjunction with the sale of prewritten software, the charge for the service is exempt from tax only when the charge for the service is reasonable and separately stated on the invoice or billing statement given to the customer."
Computer software services
Many services related to computer software are exempt. Examples of these services include:

  • training
  • consulting
  • instruction
  • troubleshooting
  • installing
  • programming
  • systems analysis
  • repairing
  • maintaining
  • servicing
However, when these otherwise exempt services are provided in conjunction with the sale of prewritten software, the charge for the service is exempt from tax only when the charge for the service is reasonable and separately stated on the invoice or billing statement given to the customer.

Sales of software upgrades
Generally, the sale of a revision or upgrade of prewritten software is subject to tax as the sale of prewritten software. If, however, the software upgrade is designed and developed to the specifications of a particular purchaser, its sale to that specific purchaser is exempt as a sale of custom software.
 
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