Get A State-by-state Analysis Of Charging Sales Tax On Services

Every state taxes services in its own way Of the 45 states remaining, four (Hawaii, South Dakota, New Mexico, and West Virginia) tax services by default, with exceptions only for services specifically exempted in the law.

If you've discovered you have sales tax nexus in California, your next step is to determine if what you're selling is taxable. Services in California are generally not taxable. However, if the service you provide includes creating or manufacturing a physical item, you may have to deal with the sales tax on products.

In short, it depends on what the invoice represents. The general rule of thumb is that: If the invoice is for the sale of a product, you likely will need to apply sales tax. If the invoice is for the sale of a service, you likely won't need to apply sales tax.

Florida sales tax is imposed on the total sales price of taxable tangible personal property. "Sales price" is defined as the total amount paid for tangible personal property, including any services that are a part of the sale.