When it comes to Software-as-a-Service (SaaS), cloud computing and electronically downloaded software, do you need to collect sales tax from your customer, or pay use tax on purchases?
Well, it depends. Some states define these as services, tangible property or none of the above; you need to take a look at each state’s statutes, regulations or other guidance to answer the question.
Another important factor to be aware of is the recent Wayfair decision from the U.S. Supreme Court earlier this summer. While it may seem to only apply to online sellers, the ruling will also affect traditional multi-state sellers that generate revenue from SaaS and software. Because the decision makes it easier to establish nexus, companies will need to be very aware of the taxability rules regarding SaaS, cloud computing and electronically downloaded software in any state in which they have nexus.
Today is the third in our series of how various states approach the taxability of SaaS, cloud computing and electronically downloaded software. Keep reading to find out how three states in the Southeast (Florida, Georgia and South Carolina) tax these items, and check out our previous posts details about states in the west!
SaaS and Cloud Computing Rules in Southeastern States
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