California brings remotely accessed software into sales tax
This page records one dated change. For the rules in United States as they stand today, see the United States guide →
- Jurisdiction
- United States
- Tax
- Sales Tax
- Change type
- Digital services
- Status
- Enacted
- Impact
- Plan ahead
- Announced
- 29 June 2026
- Effective
- 1 January 2027
- Instrument
- US-CA-SB122-2026
- Authority
- California Legislative Counsel (leginfo.legislature.ca.gov)
- Systems
- Tax engine, E-commerce, Invoicing, ERP
- Verified
- Fetched from official source · high confidence
SaaS and digital-product sellers into California, operative 1 January 2027. New section 6016.2 defines "accessed remotely" as access by digital code, password or other means to prewritten software residing on the seller’s system — broad enough to capture most SaaS.
SaaS and digital-product sellers into California should model the 1 January 2027 operative date, review remote-access contracts, and prepare tax-engine product mapping for the new "digital product" definition.
Tax engineE-commerceInvoicingERP
California SB 122 (Committee on Budget and Fiscal Review), signed on 29 June 2026, amends the Revenue and Taxation Code to bring "digital products" into the sales and use tax base, defining the term to include prewritten computer software transferred on tangible storage media, transferred electronically, or accessed remotely, and adding a new section 6016.2 defining "accessed remotely" as access by digital code, password or other means to prewritten software residing on the seller's system. The amendments become operative on 1 January 2027.
What changed in detail
California SB 122, signed 29 June 2026, amends the Revenue and Taxation Code to bring “digital products” into the sales and use tax base, defining the term to include prewritten computer software transferred on tangible media, transferred electronically, or accessed remotely, with a new section 6016.2 defining “accessed remotely” as access by digital code, password or other means to software residing on the seller’s system. Operative 1 January 2027.
What it means
California is the largest US market to define remotely accessed software as taxable, and the definition is broad enough to capture most SaaS. Combined with Utah’s July start, the practical default for US software sellers is shifting from “not taxable unless the state says so” to the reverse.
Proof
“Accessed remotely” means to have accessed for consideration by use of a digital code, password, or other means prewritten computer software that resides on the vendor’s server or the server of a third party.
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