Texas Software Taxation - Court Looks for More Information

Friday, April 23rd, 2010


The Texas Court of Appeals determined that more information was needed when it decided to send the 7-Eleven, Inc. v. Combs case back to Trial Court in order to "resolve fact issues."

By way of background:

A decision was reached at the Trial Court level in Texas. This decision made it to the Appeals Court and they decided that no tax was due on 7-Eleven's purchases of software that went into inventory for shipment outside of Texas.

The state pushed for a second look at the Appeals Court's decision, persuading the Appeals Court that they didn't have enough facts to make their decision - "that more information was needed." The Appeals Court agreed and ordered the case to be sent back to a Trial Court for more information.

The fact that this case involves software resold by 7-Eleven is almost irrelevant for purposes of the Appeals Court decision to get more information. What is relevant is the exact piece of information the Court agreed was relevant:

Whether 7-Eleven made use of the software in Texas before removing it from tax-free inventory.

About TTR

Transaction (buying or selling things), Tax (the tax on this activity), Resources (our people, our website, our support services) - TTR, Inc.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

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