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In Law360, Attorneys Analyze Digital Health Company Sales Tax Rules

Practices: Tax, Tax Controversy, Digital Health, Health Care

A Law360 article that examines how digital health companies can diagnose sales tax rules was authored by health care partner Jennifer Romig (Chicago), tax controversy counsel Elizabeth Smith (Boston), health care associate Whitney Wadman and tax law clerk Jenna Grove (both of New York).

As digital health technologies and sales tax regimes evolve, digital health companies must evaluate their sales tax collection obligations. Companies may face significant exposure for uncollected sales tax, as the payment obligation shifts to the seller if it fails to collect and remit the tax at the time of the sale. 

The authors explain that taxing authorities are becoming increasingly aggressive during sales tax audits, emboldened by the U.S. Supreme Court’s South Dakota v. Wayfair Inc. ruling, in recent state court decisions regarding the taxation of the digital economy, and their own regulatory guidance.

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