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Are amounts billed for computer software maintenance agreements subject to sales tax?

April 26, 2017agreements amounts Computer maintenance Software Subject

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Are amounts billed for computer software maintenance agreements subject to sales tax?

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The fees for computer software maintenance agreements are subject to tax if the maintenance agreement is not optional or if the maintenance agreement is optional but includes computer software updates which are not separately stated. If the maintenance agreement is optional, includes updates to the software and the update charges are separately stated, the maintenance agreement is not subject to tax but the software updates are subject to tax. The fees for computer software maintenance agreements are not subject to tax if the software is a custom program.