Laws, Regulations and Annotations


Business Taxes Law Guide—Revision 2024

Sales and Use Tax Annotations

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120.0000 Automatic Data Processing Services and Equipment—Regulation 1502

Annotation 120.2850

(b) Processing Customer-Furnished Information

120.2850 Updating Medical Files. A computer service firm receives from a customer's nursing facilities the handwritten patient records reflecting physician's orders, plan of care, etc., for the subject patient. The firm enters the information into its computer, creates a file on the patient, and prints out the various patient chart forms requested by the customer. As changes in the physician's orders, plan of care, etc., are made, the facility transmits the information in writing to the firm. The firm enters the new data into the computer and merges it with the patient's file. The firm prints the new forms with the revised patient information and sends them to the customer.

The activities described qualify as processing of customer furnished information because a file of information is maintained on the patient which is periodically updated to reflect reported changes. (Regulation 1502(d)(5).) Therefore, the medical data processing activities qualify as services not subject to tax. 6/30/82.