This webinar provides practical information on how to value service bundles for tax purposes. Service providers are selling a variety of voice, data, entertainment, and service bundles with a variety of price discounts. Taxes depend on how these bundles are allocated into various taxable and nontaxable categories such as internet access, interstate and intrastate telecommunications, and others.
The taxing authorities will require service providers to maintain “books and records” to show these allocations to comply with the Streamlined Sales Tax (SST), Business Activity Taxes (BAT), and others.

Serious consequences will occur for providers that cannot justify and document how they allocate the net sales price among the tax categories. When the allocation to taxable categories is too low, the taxing authorities can assess tax, penalty, and interest. When the allocation to taxable categories is too high, the provider can be sued in a consumer class action suit.
Regulators may require “truth in billing” disclosures such that consumers can compare the after-tax cost of bundled services between providers. Tax allocation systems must be implemented even though the taxing authorities have not yet provided clear guidance on what constitutes adequate books and records.

This webinar will provide practical answers for these questions:
• Why is valuing a bundled service important for tax purposes?
• What are advantages and disadvantages of various methods?
• What are the taxing authorities likely to accept?
• How can the method be implemented in a practical way with existing software?

Audience questions can be submitted by online during the webinar.