Nevada Computer, Software, and SaaS Tax Guide

Prepared by Sales Tax Helper

Table of Contents

1. Introduction
2. Nexus Considerations
3. General Rules and Compliance Considerations
4. Specific Exemptions
5. Sourcing Rules
6. Audit Considerations
7. Voluntary Disclosure Agreements (VDAs)
8. Conclusion
9. References & Resources

1. Introduction

Software and SaaS providers operating in Nevada must understand the state’s sales and use tax treatment of digital products and technology services to ensure compliance. Nevada’s tax rules make important distinctions between prewritten (canned) software, custom-developed software, and various technology-related services, with taxability often hinging on how the software is delivered and whether tangible property is transferred.

Unlike many states that have issued explicit policies on the tax treatment of cloud computing,
Nevada does not provide formal guidance on SaaS or IaaS. However, the state’s general sales tax framework excludes services that do not involve the transfer of tangible personal
property—resulting in a broad exemption for electronically delivered and cloud-based software solutions, when properly structured.

Purpose of This Guide

This guide is designed to help software and technology businesses understand Nevada’s sales
and use tax framework as it applies to software, digital products, and cloud computing services. It provides clarity on:

• Nexus Rules: Identifying when companies must register to collect and remit sales tax in
  Nevada based on physical or economic presence.
• Taxability Classifications: Differentiating between prewritten and custom software, and
  clarifying the treatment of maintenance contracts, bundled transactions, and cloud
  services.
• Sourcing Principles: Determining which transactions are taxable based on the location
  and method of delivery.
• Audit Risks and Documentation Requirements: Equipping businesses to minimize
  exposure and defend exemption claims.
• Voluntary Disclosure Program: Outlining Nevada’s VDA process for businesses
  seeking to resolve prior noncompliance on favorable terms.

Why It Matters for Technology Businesses

Nevada’s approach to taxing software and technology services can create significant compliance risks for companies selling or deploying software into the state:

• Tangible vs. Electronic Delivery: Prewritten software sold on physical media is taxable,
  while the same product delivered electronically or via "load and leave" is not.
• Cloud Services Exemption: SaaS, IaaS, and PaaS are generally not taxed—provided
  there is no tangible component involved in the transaction.
• Bundled Transactions: Improperly structured invoices that combine taxable and non-
  taxable items without separation can inadvertently expose the entire transaction to tax.
• Nexus Thresholds: Companies surpassing the $100,000 economic nexus threshold in Nevada for tangible personal property must register and comply with state tax obligations—even if their primary products are digital.

This guide walks through each of these considerations in detail, offering a practical roadmap for navigating Nevada’s digital tax landscape with confidence and compliance.

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