SeeSALT Blog
The Massachusetts Supreme Judicial Court recently held that software vendors have a statutory right to apportion tax on the sale of prewritten computer software purchased for use in multiple states and that they may do so through the Commonwealth’s general tax abatement process. The court’s decision in Oracle USA, Inc. v. Commissioner of Revenue, 487 Mass. 518 (2021) confirms that the ability to apportion tax on software is not contingent on strict compliance with the administrative procedures set forth in the Massachusetts Commissioner of Revenue’s apportionment regulation. The tax abatement process is an acceptable mechanism for taxpayers to seek tax apportionment with respect to software purchased for use in multiple jurisdictions.
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A New York trial court held that charges for storage services rendered in New Jersey were not subject to New York sales tax despite the fact that the property was originally picked up in New York. 
The District of Columbia Council finalized the 2021 fiscal year budget yesterday, which removed the recently enacted digital advertising tax. The Council’s July 28 vote formalized the elimination of a proposed 3% sales tax on gross receipts from traditional and digital advertising services and from the sale of personal information (e.g., IP addresses, , names, phone numbers, biometric data etc.). The proposal defined “digital advertising services” as “advertising services related to advertisements displayed on a digital interface, including advertisements in the form of banner advertising, search engine advertising, interstitial advertising, or other comparable advertising.” “Digital interface” was defined as “any combination of hardware and software that an individual may use to access internet-based platforms such as websites, parts of websites, or applications.”
The Tennessee Court of Appeals held that a single member limited liability company (SMLLC) that is disregarded for federal income tax purposes is regarded for Tennessee excise tax purposes unless its single member is classified as a corporation for federal income tax purposes. The court also held that proceeds from the settlement of a legal malpractice claim constitute “business earnings” subject to excise tax where the proceeds represent lost business revenue. EmeraChem Power, LLC v. Gerregano, No. E2019-00292-COA-R3-CV (Tenn. Ct. App. June 1, 2020). 
On March 17, 2020, the Missouri Supreme Court held that the use tax definition of “sale” cannot be applied to sales tax cases, turning more than two decades of precedent on its head. In DI Supply I, LLC v. Director of Revenue, DI Supply sold hotel room furnishings to its parent, Drury Hotels Company (DHC), which operates hotels. The issue before the court was whether DI Supply’s sales to DHC were nontaxable sales for resale. DI Supply argued the sales were for resale because DHC transferred the right to use the hotel room furnishings to its guests and included the cost of such items in the nightly room rate.