N.J. Admin. Code § 18:24-25.8

Current through Register Vol. 56, No. 21, November 4, 2024

Section 18:24-25.8 - Sourcing

(a) Sourcing of receipts from sales of prewritten computer software is governed by the following:

1. If prewritten computer software is received by the purchaser at a business location of the seller, the retail sale is sourced to that business location.

2. If prewritten computer software is not received by the purchaser at a business location of the seller, the retail sale is sourced to the location(s) where receipt by the purchaser occurs. Receipt may occur at multiple locations if the seller delivers the computer software to multiple locations. The transaction is sourced to those locations if the seller receives delivery information from the purchaser by the time of the invoice.

3. If

(a)1 and 2 above do not apply, the retail sale is sourced to the location indicated by an address for the purchaser that is available from the business records of the seller, that are maintained in the ordinary course of business when use of this address does not constitute bad faith.

4. If

(a)1, 2 and 3 above do not apply, the retail sale is sourced to the location indicated by an address for the purchaser obtained during the consummation of the retail sale, including the address of a purchaser's payment instrument if no other address is available when this address does not constitute bad faith.

5. If (a)1, 2, 3, or 4 above do not apply, including circumstances in which the seller is without sufficient information to apply those paragraphs, then the retail sale is sourced to the jurisdiction for the address of the location from which the prewritten computer software was shipped, or, if delivered electronically, was first available for transmission by the seller.

(b) Sourcing of receipts from sales of services to prewritten computer software is governed by the following:

1. A retail sale of a computer-related service is sourced where the purchaser makes first use of the service. The purchaser may make first use of a service in more than one location.

2. A retail sale of a post-sale support agreement, sold by the seller of computer software at the same time as the sale of the computer software itself, is sourced to the same address(es) as the retail sale of the underlying computer software.

(c) Sourcing of payments made in connection with a software term license or subscription is governed by the following:

1. Initial payments are sourced in the same manner as the sale of the computer software. (See (a) above)

2. If the initial payment is sourced based on the location where receipt by the purchaser (or the purchaser's donee, designated as such by the purchaser) occurs, including the location indicated by instructions for delivery known to the seller, then the following applies:

i. If the seller receives information from the purchaser indicating that the location of the underlying computer software has changed, a subsequent payment made in connection with a software term license or renewal of a software subscription is sourced to such new location.

ii. If the seller has not received information from the purchaser indicating a change in the location of the underlying computer software, sourcing a subsequent license payment made in connection with a software term license or the renewal of a software subscription to the same location where the initial payment was sourced will not constitute bad faith.

N.J. Admin. Code § 18:24-25.8

Amended by 46 N.J.R. 2375(a), effective 12/1/2014
Renumbered 18:24-25.7 to 18:24-25.8

Amended by 48 N.J.R. 824(a), effective 5/16/2016