Changes to Massachusetts Sales and Use Tax on Computer and Software Services Law Effective July 31, 2013August 14, 2013
Kevin D. Fontana, CPA, MSA, MST
Effective July 31, 2013, pursuant to newly enacted legislation, An Act Relative to Transportation Finance, St. 2013, c. 46 (the Act), Chapters 64H and 64I of the Massachusetts General Laws, have been amended to apply the sales and use tax to certain services relating to (1) computer system design and (2) the modification, integration, enhancement, installation or configuration of standardized or prewritten software. As a result, the Massachusetts Department of Revenue (DOR) recently issued Technical Information Release 13-10 to provide initial guidance regarding these statutory changes, the applicable sourcing rules, transition rules for existing contracts, electronic filing requirements, calculation of use tax liability, the effective date and its impact on filings and payments.
In addition, a DOR website page dedicated to providing information on the recent tax changes, including a series of FAQs, may be accessed at www.mass.gov/dor/newtaxinfo.
Further guidance regarding the scope of the sales and use tax on computer and software services was recently issued in the form of a working draft TIR.. This is intended to supplement the above-noted TIR and FAQ’s.
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