Texas Court Rules That Bill Payment Service Was Not Taxable

Tuesday, May 3rd, 2016

Online bill pay.

The Texas Court of Appeals determined that an online bill payment service was part of a nontaxable professional service, not a taxable data processing service.

A company provided customers with an online service that allowed them to make payments for various bills. It also allowed customers to customize information for different payees and review past payments.

Texas taxes data processing services, which include services for storing, changing, or searching computerized data and information. The Court determined that the bill payment service was not taxable as a data processing service. Instead, the court ruled that the company used the computerized process to make it easier for the company to provide a nontaxable professional service.

Hegar v. CheckFree Services Corporation, 14-15-00027-CV (Tex. App. 2016).

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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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