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 120.3645

(c) Custom Programs

120.3670 Service Versus Sale. Custom computer programs are exempted by section 6010.9 as services even when included in the sale of computer equipment without a separate itemization of the charge. A reasonable allowance for the value of such services must be recognized in determining the measure of tax of such transactions. If, however, the programs included in the sale of the equipment consist of prewritten programs modified for the needs of the customer, section 6010.9 requires that the charges for the modifications be separately stated to be exempt from tax. 11/13/84.