Facilities Management Software Is Subject to New York Sales Tax

Two CBRE Group Inc. subsidiaries must New York pay sales tax on prewritten software bundled with nontaxable services, a state tribunal ruled in an opinion released Friday.

FacilitySource LLC and FacilitySource Northeast Services LLC argued their software is just one means by which they provide services that have the primary function of handling facilities management for large retail chains. But the software is “anything but incidental or ancillary to petitioner’s services,” the New York Tax Appeals Tribunal ruled.

Courts in New York and around the country have struggled to find the line between selling software and providing services that ...