Massachusetts – Guidance Regarding the New Computer and Software Services Tax

SALT Report 2811 – Due to the high volume of questions regarding the new sales and use tax on computer system design services and the modification, integration, enhancement, installation or configuration of prewritten software that went into effect on July 31, 2013, the Massachusetts Department of Revenue released a notice to address the most commonly asked questions.

The notice discusses what qualifies as prewritten software, modifications to prewritten software that are subject to tax, licensed software, exemptions, taxable labor and installations charges, open source software, website design, hosting and data storage, application of tax to contracts entered into prior to July 31, software upgrades, registering to collect sales and use tax, filing your tax return, domain registration services, and value-added resellers.

The Department advises that the information provided in the notice is general in nature and will be updated as needed.

For Further Information

Massachusetts Department of Revenue – Frequently Asked Questions: The New Computer and Software Services Tax

SALT Report 2782 – Massachusetts – Taxability of Computer and Software Services