Some of you by now have heard about some of the MSPs in Florida dealing with sales taxation of managed/professional services. While we continue to take measures to help protect MSPs from unnecessary taxation during a difficult economy, there are some things you can do to arm yourself against the tax.
1) If you do sell hardware be aware of how you invoice your non-services offerings. Mixing different products/solutions into one invoice maybe a good idea at the time, but during a tax audit it might not seem like that great of an idea.
2) Consult your tax professional about your existing service offerings. Different states have different ways of dealing with taxing IT services. Since cloud computing, there is no shortage of states and countries coming up with innovative ways to tax the cloud. Talking to your accountant is very important in order not to assume unnecessary risk.
3) Don’t be afraid to outsource. Leasing and HaaS isn’t for everyone. It demands attention to detail and at least a threshold knowledge of financing. If you want to offer a HaaS product but do not know how to go about doing it, partner with a firm that knows how.
Taxation entities now know about MSPs and cloud computing. Whereas earlier MSPs could rely on the technical obscurity of their profession to keep the tax man at bay, today there are few places left to hide.