Michigan Sales Tax on Software and Digital Products Michigan: Sales Tax Handbook

Michigan:

Are Software and Digital Products subject to sales tax?

While Michigan's sales tax generally applies to most transactions, certain items have special treatment in many states when it comes to sales taxes. This page describes the taxability of software and digital products in Michigan, including canned software - delivered on tangible media, canned software - downloaded, custom software - delivered on tangible media, custom software - downloaded, customization of canned software and digital products. To learn more, see a full list of taxable and tax-exempt items in Michigan.


Canned Software - Delivered on Tangible Media
TAXABLE
Sales of canned software - delivered on tangible media are subject to sales tax in Michigan.

Canned Software - Downloaded
TAXABLE
Sales of canned software - downloaded are subject to sales tax in Michigan.

Custom Software - Delivered on Tangible Media
EXEMPT
Sales of custom software - delivered on tangible media are exempt from the sales tax in Michigan.

Custom Software - Downloaded
EXEMPT
Sales of custom software - downloaded are exempt from the sales tax in Michigan.

Customization of Canned Software
TAXABLE
In the state of Michigan, it is considered to be exempt if it was separately stated and separately identified.

Digital Products
EXEMPT
Sales of digital products are exempt from the sales tax in Michigan.



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Source: http://www.salestaxhandbook.com/michigan/sales-tax-taxability/software-and-digital-products