New York Issues Proposed Sourcing Regs for Services, Digital Goods

Alysse McLoughlin said that draft New York tax regulations for the sale of services and digital products are a good attempt to apply statutory sourcing methods, especially given their use of numerous examples. She added, however, that a due diligence requirement in the regs means “before the taxpayer determines that it can abandon the first sourcing method in the [tax] hierarchy, the taxpayer must now make inquiries to its customer” regarding sourcing.