Sales, Use and International Tax Activity Update - January 2010

Missouri Maintains Exemption on Maintenance Agreements

The charge for an optional maintenance agreement that an alarm system monitoring company offers its customers is not subject to Missouri sales tax because a maintenance agreement is not one of the enumerated taxable services under §144.0202, RSMo, provided that the charge is separately stated on the customer's bill.

However, the taxpayer must remit use tax on parts used in the performance of a maintenance agreement. The local use tax that applies is the location where the parts are first delivered in Missouri.

The full letter ruling can be viewed on the Missouri Department of Revenue Web site.

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