The Missouri Department of Revenue ("Department") recently determined that purchases of computers, software, and computer security systems by certain architectural or engineering firms are exempt. An architectural firm headquartered in Missouri and operating multiple facilities worldwide requested a ruling from the Department about the taxability of its purchases of computers, software, and computer security systems. The Firm engaged in architectural, engineering, planning, interiors, graphics, and consulting services. In addition to its headquarters, the firm had another Missouri-based office. The domestic and foreign offices were separate and distinct businesses operated as separate profit centers but were consolidated for tax purposes because the offices represent one firm.
Missouri exempts computers, computer software, and computer security systems from sales and use tax when purchased for use by architectural or engineering firms headquartered in the state. "Headquartered in the state" is defined as "the office for the administrative management of at least four integrated facilities operated by the taxpayer is located in the state of Missouri." Because the firm had more than four integrated facilities and its headquarters located in Missouri, it qualified for the exemption.