Escape Key Computing adheres to Minnesota State Law and the laws of the communities in which we do business. Specifically, in the State of Minnesota, tax is applied to any installation, delivery, or conversion of data from one physical medium to another. Per Minnesota's Sales Tax Fact Sheet #134:
Installation or set up of a computer system, or installation
of hardware or prewritten software upgrades, is taxable.
This is true when the installation charges are billed
by the seller of the system and when billed by a third
party hired only to do the installation. Amounts paid to reimburse the expenses of the installer for travel, lodging,
meals, etc., are part of the installation charge and are
also taxable.
Reinstallation charges are not taxable. For example, if a
system crashes and software has to be reinstalled, no tax
applies to the charge for reinstallation. Tax is only due
on the initial installation of an item.
Delivery charges for taxable products, such as computer
hardware or prewritten software, are taxable. Delivery
charges include charges such as shipping, postage, handling,
crating and packing. Delivery charges for nontaxable
products or services are not taxable. See Fact Sheet
155, Delivery Charges, for more information.
Free software. Installation or delivery charges for free
software are taxable. Since installation and delivery
charges are included in the definition of sales price,
these charges become the sales price of the free software
and are taxable.
Converting data from one physical form to another is
taxable. For example, converting a floppy disk to CD,
tape, or paper report is taxable.
Converting data from one electronic format to another is not taxable. For example, converting electronic data in
order to run the data on a new computer system is not
taxable.
Compressing or zipping files is not taxable.
Charges to access data from a database at a remote
location are not taxable.
