New Jersey Administrative Code › Title 18 - TREASURY - TAXATION › Chapter 24 - SALES AND USE TAX ACT › Subchapter 35 - INFORMATION SERVICES › Section 18:24-35.5 - Examples of services that are not treated as information services

Current through Register Vol. 56, No. 14, July 15, 2024
(a) The following are
				examples of services that are not treated as information services under
				54:32B-3(b)(12) 
				because they consist of furnishing "personal" or "individual" information specific
				to the particular purchaser and not furnished to others:
Example 1: A service provider assembles data provided by both its
				  purchaser and its purchaser's suppliers. The data pertains to the purchaser's
				  transactions buying and selling telecommunication services. The data is then put
				  into a common format and entered into a database managed by the service provider.
				  The data used to provide the service is not made available to any other potential
				  purchaser. The database and certain software is accessible online only to the
				  specific purchaser. The service provider's software allows the purchaser to view the
				  data and manipulate and analyze the data in many different ways to help them reduce
				  costs and maximize revenue.
The information in the database is personal or individual to the
				  purchaser and not furnished to others by the service provider, and is not an
				  information service.
Example 2: A business is involved in producing custom market
				  research reports to assist its purchasers in making marketing decisions. The
				  business develops a questionnaire specific to the needs of each individual
				  purchaser, interviews random respondents, tabulates and analyzes the data, and
				  communicates the findings to the purchaser in a report. The business is prohibited
				  from disclosing any part of the project to anyone else.
The information is personal or individual to each customer, it is
				  not provided to others, and thus the service is not an information service.
Example 3: A web-based business allows purchasers to obtain
				  up-to-date information about their own websites, such as viewers' online behavior.
				  The information is collected by the business by embedding code into the purchaser's
				  website design, which causes the information to be sent to the business's server.
				  Purchasers can request reports based on their needs, such as the amount of time
				  their customers spend viewing, length of time on the website, etc.
The information is personal or individual in nature, and thus,
				  the service is not an information service.
Example 4: A business sells a news clipping service whereby it
				  searches information from a variety of sources and gathers any information that
				  mentions the purchaser's name. The information collected is provided to the
				  customer.
The information is personal or individual to the customer, and
				  therefore the service is not an information service.
(b) The following are examples of services that
				are based on information, but are not taxed as information services under
				54:32B-3(b)(12):
Example 1: The principal purpose of a multiple listing service,
				  which is available only to a real estate licensee, is to facilitate offers of
				  cooperation and compensation between brokers.
This service is not an information service and is not subject to
				  tax.
Example 2: As requested by purchasers of its services, a business
				  obtains information concerning a particular piece of real property, which may
				  include an on-site inspection of such property in order to sell a real estate
				  appraisal to banks, mortgage companies, individuals, etc.
The appraisal service is not an information service and is not
				  subject to tax.
Example 3: A business sells consulting services to advise
				  purchasers of their service about their hardware and/or software needs. These
				  services include interviewing staff to gather information and presenting a written
				  report on findings and recommendations.
The consulting service is not an information service and is not
				  subject to tax.
Example 4: A business sells contract programming services, which
				  consist of the design, development, and implementation of computer programs based on
				  the purchaser's particular computer system.
The consulting service is not an information service and is not
				  subject to tax.
Example 5: An attorney consults with a purchaser of his
				  professional services, gathers information, and draws up a legal document, such as a
				  will, a contract, a power of attorney, etc.
The service is not an information service and is not subject to
				  tax.
Example 6: A business performs environmental testing services and
				  issues a report on factors, such as the condition of the property, levels of a
				  particular substance, or habitability.
The testing service is not an information service and is not
				  subject to tax.
Example 7: A business sells payroll processing services, which
				  consist of receiving employee specific information and printing pay checks, pay
				  stubs, or similar items.
The payroll processing service is not an information service and
				  is not subject to tax.
Example 8: A business sells court stenography services, which
				  result in a transcript of court or other legal proceedings.
The court stenography service is not an information service and
				  is not subject to tax.
Example 9: A business provides accident reconstruction services,
				  which include obtaining and reviewing police reports, medical records, etc, and a
				  physical inspection of the scene.
The accident reconstruction service is not an information service
				  and is not subject to tax.
Example 10: A title insurance company performs a title search on
				  real property, examines the information, and determines whether to issue a title
				  insurance policy to the purchaser.
The issuance of a title policy, which includes the pass-through
				  of costs associated with obtaining and examining the information is not an
				  information service and is not subject to tax.
Example 11: A business receives orders from lawyers for the
				  preparation of certificates to form corporations or limited liability companies. The
				  documents are prepared, hand-delivered to Commercial Recording for filing, retrieved
				  once they are registered, and sent to attorneys. The business also receives
				  documents from purchasers of its service, which it submits to the State for
				  filing.
This is not an information service and is not subject to
				  tax.
Example 12: A company, professional organization, or trade school
				  offers educational seminars, classes, or courses attended by individuals seeking
				  continuing education credits, required pre-licensing education, or to advance their
				  expertise in a particular profession. Written and published educational material may
				  or may not be distributed to participants attending these educational
				  programs.
The educational seminar, class, or course is not an information
				  service and is not subject to tax.
(c) Fees paid to New Jersey or Federal
				governmental agencies to obtain documents, records, or other information, which the
				agency is required to maintain as part of its regulatory or administrative function
				are not subject to tax. Examples include, but are not limited to:
1. Fees paid to municipal clerk's office to obtain
				a copy of zoning map;
2. Fees paid to
				police department to obtain a crime report or motor vehicle report; and
3. Fees paid to the New Jersey Division of
				Taxation to obtain a copy of a tax return previously filed.