Ezel / Tax Rulings / TX
TX 9104L1099F03 Sales and/or Use Tax (State,Local,MTA) 1991-04-15

Was telephone software support taxable when the support was delivered to an out-of-state location for use outside Texas?

Short answer: No. Software telephone support was taxable maintenance generally, but support delivered to an out-of-state location for use outside Texas was exempt under Texas Tax Code § 151.330(e).

Apply this to your situation

This page answers the general question as of 1991. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1991
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official Texas Comptroller of Public Accounts letter published on the State Tax Automated Research (STAR) system. Letters on STAR can be the basis of a detrimental reliance claim only for the taxpayer to whom the letter was directly issued (see 34 Tex. Admin. Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded. Taxpayer-identifying details are redacted. This summary is informational only and is not legal or tax advice. Consult a licensed Texas tax professional about your specific situation.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page) is the authoritative source for any reliance.

Plain-English summary

A software company provided telephone support to customers. The Comptroller treated that support as taxable maintenance, but said no Texas tax applied when the service was delivered to an out-of-state location for use outside Texas. The letter cited Texas Tax Code § 151.330(e) for that exemption.

What this means for you

The letter distinguished taxable software maintenance from an exempt exported service based on where the support was delivered and used. Its answer was limited to the stated facts.

Common questions

Was software telephone support generally taxable? Yes. The letter called it taxable maintenance.

What made the support exempt? Delivery to an out-of-state location for use outside Texas.

What authority did the letter cite? Texas Tax Code § 151.330(e).

Citations and references

  • Texas Tax Code § 151.330(e) — service delivered outside Texas for use outside Texas

Source

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

JOHN SHARP
Comptroller April 15, 1991

Dear ****:

You called concerning software maintenance.

A software company provides telephone support to customers.
The support is maintenance and is taxable. However, if the
support is provided to an out-of-state location, the service
is not taxable. When a taxable service is delivered out of
state for use out of state, the service is exempt from tax
under 151.330(e).

This opinion is based on the facts presented. If there are
additional or different facts, the opinion may change.

If you have any questions or need more information, please
call me. The toll-free number is 1-800-531-5441. The
regular number is 512/463-4614. or you may write me, Tax
Administration Division. [(fax) 512-475-0900.]

Sincerely,
Adina Whittemore
Tax Administration Division

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