Tax Alert

UPDATE: Massachusetts Sales and Use Tax on Computer and Software Services

First Due Date For Reporting and Paying Sales and Use Taxes on Computer and Software Services Extended to October 20, 2013

September 1, 2013

Given the growing support among Massachusetts government officials for the repeal of legislation enacted in July 2013 applying the sales and use tax to certain “computer and software services”, the Massachusetts Department of Revenue, in Technical Information Release 13-14, has extended the first due date for reporting and paying such taxes. Sales and use taxes on “computer and software services” performed and billed during the period from July 31, 2013 through the end of August 2013 must now be reported and paid by October 20, 2013. (The original due date was September 20, 2013.)

The DOR also notes in TIR 13-14 that if the sales and use tax on certain “computer and software services” is repealed, it will issue additional guidance regarding refunding customers for collected taxes and applying for abatement of any remitted taxes.

TIR 13-14 has no effect on reporting and paying sales and use taxes on sales other than on certain “computer and software services”. Thus, sales and use taxes on August 2013 taxable sales of tangible personal property, including sales of prewritten software, and telecommunications services, remain fully due and payable on September 20, 2013.

For more information on the Massachusetts sales and use tax on certain “computer and software services” and the evolving guidance, see:

Please contact Chip Wry to learn more about how these tax changes affect your business.

This Tax Alert provides general information only. It is not intended to provide advice with respect to any specific set of facts, nor is it intended to advise on all developments in the law.

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