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Sales and Use Taxes: Streamlined Sales Tax System (Portfolio 1270)

Product Code: TPOR44
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Sales and Use Taxes: Streamlined Sales Tax System provides comprehensive discussions on a wide range of issues dealing with the development and implementation of the streamlined sales tax system. Written by Arthur R. Rosen, Esq., McDermott Will & Emery LLP, and Susan K. Haffield, PricewaterhouseCoopers LLP, this Portfolio explains the consummation of the streamlined sales tax effort and the relationships between various groups key to the process. Additionally, the Portfolio details the components of the Streamlined Sales and Use Tax Agreement and examines how the states must apply them. 

This Portfolio also provides analysis of the governance of the Agreement, highlighting state and retailer concerns, and concludes with a state-by-state analysis. The state-by-state portion examines those states that participate in streamlined discussions, and where states have enacted conforming legislation, provides an overview to the state's applicable sales and use tax laws.  

The state-by-state analysis identifies exemptions by entities, type of transaction, and intended use for three types of property.  It also identifies the taxation of specific items, including: 

  • Sales price,
  • Food and food ingredients,
  • Clothing,
  • Computers and related items,
  • Healthcare, and
  • Services.

Sales and Use Taxes: Streamlined Sales Tax System allows you to benefit from: 

  • Hundreds of hours of original research on specific tax planning topics from leading practitioners in this area.
  • Invaluable practice documents including tables, charts and lists.
  • Plain-English guidance from world-class experts.
  • Real-world and in-depth analysis that lets you explore various options.
  • Time-saving access to relevant sections of tax laws, regulations, court cases, IRS documents and more.
  • Alternative approaches to both common and unique tax scenarios.

This Portfolio is part of the Premier State Tax Library, a comprehensive series, which covers major state tax transactions and issues with expert, in-depth analysis, and offers commentary on a wide range of multi-state and state-specific taxation topics, including Sales and Use, Corporate Income, Individual Income, Property, Gross Receipts, Limitations on States' Authorities to Tax, Credits and Incentives, Electronic Commerce, Mergers and Acquisitions, Procedure and Administration, Special Industries, and more.

 

Detailed Analysis

1270.01. STREAMLINED PROCESS

A. Overview

B. Background

C. Process

1. SSTP

2. SSTIS

3. SSTCS

4. State Conformity

5. Certification of Compliance

6. Governing Board

1270.02. AGREEMENT PROVISIONS

Introductory Material

A. Uniform Definitions

1. Uniform Administrative Definitions

a. Delivery Charges

b. Direct Mail

c. Lease or Rental

d. Retail Sale or Sale at Retail

e. Sales Price/Purchase Price

f. Purchase Price

g. Tangible Personal Property

h. Bundled Transaction

2. Uniform Product Definitions

a. Food and Food Ingredients

(1) Soft Drinks

(2) Vending Machine Sales

(3) Candy

(4) Dietary Supplements

(5) Prepared Food

b. Clothing

c. Computers and Related Items

d. Healthcare

e. Telecommunications

B. Exemptions

C. Direct Pay Permits

D. Provisions Impacting Local Taxes

1. State-Level Administration

2. Uniform State and Local Tax Base

E. Tax Rate and Boundary Simplification

1. Exceptions to Single Rate Requirement

2. Caps and Thresholds

3. Rate Database

4. Rate and Boundary Notifications

F. Sourcing

1. General Sourcing Rule

2. Multiple Points of Use

3. Sourcing for Leased Property

a. General Rule: Leased Property/Periodic Payments

b. General Rule: Leases/Lump-Sum; Non-Recurring Payments

c. Mobile Property Not Used in Interstate Commerce

d. Mobile Property Used in Interstate Commerce

4. Direct Mail

5. Telecommunications

6. Services

G. Administration and Compliance

1. Uniform Registration System

2. Uniform Returns

3. Uniform Fund Remittances

4. Uniform Bad Debt Recovery

5. Uniform Rounding

6. Sales Tax Holidays

7. Customer Refund Procedures

H. Compliance Technology

1. Service and Software Solutions

2. Confidentiality

3. Taxability Matrix

4. Service/Software Implementation Concerns

I. Vendor Compensation

J. Amnesty

1270.03. REPLACEMENT TAXES

1270.04. GOVERNANCE

A. Administration

B. Withdrawal

C. Dispute Resolution

1270.05. ALABAMA

1270.06. ALASKA

1270.07. ARIZONA

1270.08. ARKANSAS

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.09. CALIFORNIA

1270.10. COLORADO

1270.11. CONNECTICUT

1270.12. DELAWARE

1270.13. DISTRICT OF COLUMBIA

1270.14. FLORIDA

1270.15. GEORGIA

1270.16. HAWAII

1270.17. IDAHO

1270.18. ILLINOIS

1270.19. INDIANA

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.20. IOWA

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.21. KANSAS

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.22. KENTUCKY

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.23. LOUISIANA

1270.24. MAINE

1270.25. MARYLAND

1270.26. MASSACHUSETTS

1270.27. MICHIGAN

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.28. MINNESOTA

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.29. MISSISSIPPI

1270.30. MISSOURI

1270.31. MONTANA

1270.32. NEBRASKA

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.33. NEVADA

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.34. NEW HAMPSHIRE

1270.35. NEW JERSEY

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.36. NEW MEXICO

1270.37. NEW YORK

1270.38. NORTH CAROLINA

A. Overview and Conformity

B. Taxation of Items

1. Overview

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.39. NORTH DAKOTA

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.40. OHIO

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.41. OKLAHOMA

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.42. OREGON

1270.43. PENNSYLVANIA

1270.44. RHODE ISLAND

1270.45. SOUTH CAROLINA

1270.46. SOUTH DAKOTA

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.47. TENNESSEE

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.48. TEXAS

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.49. UTAH

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.50. VERMONT

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.51. VIRGINIA

1270.52. WASHINGTON

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.53. WEST VIRGINIA

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

1270.54. WISCONSIN

1270.55. WYOMING

A. Overview and Conformity

B. Taxation of Items

1. Sales Price

2. Food and Food Ingredients

3. Clothing

4. Computers and Related Items

5. Healthcare

6. Services

C. Exemptions

1. Entities

2. Type of Transaction

3. Type of Property, Intended Use

a. General

b. Manufacturing

c. Farming and Timber

Working Papers

Item Description Sheet

Worksheet 1 Streamlined Sales and Use Tax Agreement Links

Worksheet 2 [Reserved.]

Worksheet 3 Taxability Matrix Library of Definitions

Worksheet 4 Streamlined Sales Tax Compliance Checklist

Worksheet 5 State Petitions for Membership

Worksheet 6 Excerpt from BNA 2008 Survey - Conformity to Streamlined Sales and Use Tax Agreement (SSUTA)

Worksheet 7 States Taxability Matrix

Bibliography

Bibliography

Susan Haffield
Susan Haffield is a partner in the Minneapolis office of PricewaterhouseCoopers. She serves as the state and local tax practice site leader and specializes in sales and use tax. Susan provides consulting services focusing on tax strategy and planning, audit defense, refund analysis, re-engineering, and e-commerce. She has also been actively involved with the Streamlined Sales Tax Project since its inception and has published several articles on the subject. Susan is actively involved with many business and taxpayer organizations such as the, Minnesota Chamber of Commerce, Illinois Chamber of Commerce, Illinois Civic Federation, Iowa Taxpayer's Association, and Minnesota Society of CPA's. She is also a frequent speaker for organizations such as Council On State Taxation, Institute for Professionals in Taxation, Tax Executive Institute, and New York University. Susan graduated from Moorhead State University in Accounting and Business Administration. She began her career with Arthur Andersen and has also worked in the tax department at Cargill Inc. 
Arthur Rosen
Mr. Rosen is a partner in the law firm of McDermott Will & Emery, where his practice focuses on tax planning and litigation relating to state and local tax matters. He has served as the Deputy Counsel to the New York State Department of Taxation and Finance, Tax Counsel to the New York State Senate Tax Committee and Counsel to the N.Y. Governor's Temporary Sales Tax Commission. Mr. Rosen has held executive tax management positions at Xerox Corp. and AT&T. Mr. Rosen holds leadership positions in professional tax organizations including the New York State Bar Association tax section, the NYU Tax Society, and the National Association of State Bar tax sections. He is past chair of the State and Local Tax Committee of the American Bar Association tax section. Mr. Rosen is editor of the newsletter Inside New York Taxes, is co-editor of the newsletter New York Tax Highlights and of New York Tax Cases. He has written scores of articles that have appeared in numerous professional publications, has made hundreds of presentations on state and local tax matters, and founded and chairs the New York University course entitled “Introduction to State and Local Taxes.” He is a member of the American College of Tax Counsel and is listed in The Best Lawyers in America.