How we help you
A continually changing state tax landscape makes it tough to stay informed and effectively plan for the future. You need a tax advisor who can guide you and partner with you to reach your goals — whether that’s understanding compliance requirements or avoiding an overpayment of tax.
Develop a comprehensive strategy to get your company compliant.
Gain proactive guidance to satisfy long-term business objectives.
Manage your tax obligation, minimize your tax liability and leverage statutory exemptions.
Mitigate risk and remediate liabilities.
Provide clarity around SALT and minimize your SALT tax exposure
Wipfli’s state and local tax advisors help you stay up to speed with SALT laws and clarify the increasingly complex statutes. From state and local tax consulting to compliance assistance, we implement and manage solutions to create competitive advantages, mitigate your SALT tax exposure and minimize tax.
Explore our state and local tax services
All states that have a sales tax have implemented economic nexus laws, and state regulators are aggressive in their efforts to audit filers and root out non-filers.
By creating solutions that align with your business objectives, Wipfli helps you identify the possible impact of your tax obligations, mitigate your risk and liabilities and provide you with a comprehensive strategy to get your company compliant. We assist with everything from nexus studies, voluntary disclosure agreements, utility exemption studies, taxability determinations and compliance reporting to sales and use tax audit defense, refund overpayment reviews and jurisdictional tax registrations.
Wipfli’s state income and franchise tax advisors deliver the proactive guidance you need to effectively manage risk and satisfy your long-term business objectives.
With deep experience, the Wipfli team provides assistance across a broad range of personal income tax, business income tax, franchise tax and gross receipts tax topics — including nexus studies, voluntary disclosure agreements, apportionment issues, pass-through entity tax elections, state residency, due diligence consulting, corporate income tax combined/consolidated filing issues, and audit support and defense.
Navigating tax rules and filing requirements across multiple state and local taxing jurisdictions can be overwhelming.
Wipfli’s property tax professionals have developed a comprehensive process to help you manage your tax obligation, minimize your tax liability with common-sense reporting, and leverage statutory exemptions. From personal property tax compliance to reviewing where you have filing obligations, we deliver a custom solution for your business that helps relieve the burden on your internal resources.
Unclaimed property is a growing area of financial concern for companies of all sizes and in all industries. Many state administrators have increased enforcement efforts for compliance with their unclaimed property laws and regulations.
Wipfli professionals can help you identify the potential impact of unclaimed property, mitigate risk and remediate unclaimed property liabilities. With proactive planning, our tax advisors help you create a seamless strategy to become compliant. We also provide training and support to company personnel, representation throughout audits and VDAs, and unclaimed property reporting.
Insights and resources
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Year-end state and local tax planning
As the end of 2026 approaches, many taxpayers are holding tax-planning meetings with their CPAs and financial advisors. Even though federal taxes are important to evaluate, state tax considerations are also a critical part of effective tax planning. Here are several state income and sales tax planning opportunities that businesses and individuals should consider for year-end: Planning for businesses As your business closes out 2026, several state income and sales tax planning opportunities deserve attention now to avoid costly penalties and missed savings later. Economic nexus analysis States’ economic nexus thresholds are based on specific amounts of annual gross revenue from sales to in-state purchasers. Our reference table provides the thresholds for states that use economic nexus concepts. If you expect that your projected 2026 sales in any state will likely exceed that state’s threshold, you can start making estimated payments now and avoid penalties and interest in 2027. Additionally, you can also identify the states in which you are required to collect sales tax and start collecting before uncollected liabilities become significant. Gross receipts taxes Even though tax planning usually conjures thoughts of income taxes, many states impose taxes based on something other than income, such as net worth or gross revenue. Because gross receipts tax liabilities may exist even for businesses that operate at a loss or are exempt from sales taxes as wholesalers, all companies should pay special attention to whether they have nexus in one of the eight states that impose a gross receipts tax. Here are a couple of examples: In states like Washington, the economic nexus threshold is only $100,000. The exposures can add up fast with recently enacted rates of 0.5% for wholesalers and retailers and up to 2.1% for general service businesses. In Oregon, the penalty for being noncompliant with its gross receipts tax for three consecutive years is 100% of the tax. Pass-through entity taxes For S corporations and partnerships, state pass-through entity taxes (PTET) are a great way to help their individual owners save federal personal income tax. Now that Maine has enacted its own PTET, all states with a personal income tax except North Dakota, Pennsylvania, Vermont and Washington, D.C. offer them. The reason for focusing on PTET issues as part of year-end planning is that, in general, state taxes must be paid (not just accrued) by the end of 2026 to qualify for a 2026 federal deduction. In addition, in states like Utah, the PTET election must be made by the end of 2026 to be valid. Sales tax on software and digital goods Currently, California and Colorado (at the state level) do not impose sales tax on electronically delivered software or cloud-based software (SaaS). California also does not impose sales tax on digital goods. However, beginning January 1, 2027, both states will start taxing these products and services. If you have a large software purchase that you were planning on making in 2027, you could benefit from purchasing it in 2026 before it becomes taxable in those two states. If you’re currently subscribed to a software that will become taxable in 2027, you may be able to ask your software provider to bill you for an annual license renewal prior to 2027 in order to realize the sales tax savings. Reverse sales and use tax review Have you been taking advantage of all sales tax exemptions you are entitled to? If you think some purchases may have slipped through the cracks and weren’t purchased without tax, it’s a good idea to conduct a reverse sales and use tax review to identify those and submit a refund claim before they are out of statute. For most states, the statute of limitations is three or four years. If you try to claim a refund for a purchase made before that, the state will automatically deny your claim. Additionally, a reverse sales and use tax review can help identify areas where use tax should have been paid but wasn’t. Identifying use tax deficiencies now can help save on interest and penalties if corrected on your own rather than waiting for an auditor to find them. Planning for individuals: Statutory residency planning As our article on dual residency explains, it is possible to be a tax resident of two states for the same year: one based on domicile (intent) and one based on day count (statutory residency). So, if your time spent in any non-domicile state for 2026 is approaching the 183-day mark, you still have time to plan your travel for the rest of the year to avoid going over that threshold. Otherwise, you may have to file as a full-year resident in two states for 2026. Read more IRS online account guide: How to create an online IRS account for individuals or businesses You earned over $500,000 this year. What are your best year-end tax planning strategies? Major updates in unclaimed property compliance
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Businesses that serve customers in Pennsylvania’s Philadelphia or Allegheny counties face new sales tax rules
Pennsylvania has adopted a significant change to its local sales tax sourcing rules that goes into effect on October 1, 2026. Under Act 21 of 2026, the requirement to collect local sales tax for Philadelphia County and Allegheny County is based on where the taxable product or service is delivered, rather than where the seller is located. The change applies only to the two Pennsylvania jurisdictions that impose local sales tax: Philadelphia County, which has a 2% local tax, and Allegheny County, which has a 1% local tax. Pennsylvania’s 6% state sales tax rules have not changed, but businesses that were only required to collect the state tax will have an additional local tax collection obligation when taxable sales are delivered into either jurisdiction when the new law goes into effect. How have Pennsylvania sales tax rules changed? Previously, Pennsylvania’s local sales tax rules focused on the seller’s location. If a seller’s place of business was in Philadelphia County or Allegheny County, the seller collected the applicable local tax on taxable sales, even when the customer received the product elsewhere in Pennsylvania. By contrast, sellers located outside Philadelphia County and Allegheny County collected only the 6% Pennsylvania state sales tax, even when taxable products were delivered to customers in Philadelphia County or Allegheny County. As a result, local tax was driven by where the sale originated rather than where the customer received the product. This created different tax results for similar transactions depending on whether the seller had a location inside or outside one of Pennsylvania’s local taxing jurisdictions. Act 21 changes that approach by moving the local tax collection requirements to the customer’s destination. A taxable sale delivered to a customer in Philadelphia County is subject to Pennsylvania’s 6% state sales tax plus the 2% Philadelphia County local sales tax, for a combined rate of 8%. A taxable sale delivered to a customer in Allegheny County is subject to the 6% state sales tax plus the 1% Allegheny County local sales tax, for a combined rate of 7%. For example, a Pennsylvania retailer located outside Philadelphia County that ships a taxable item to a Philadelphia County customer will now need to collect the Philadelphia County local tax. Conversely, a business located in Philadelphia County that ships a taxable item to a customer outside of Philadelphia County will no longer need to collect Philadelphia County local tax solely because of the seller’s location. How do the new Pennsylvania local sales tax changes affect businesses? For businesses with a physical presence in Pennsylvania, the change alters when local tax applies. Sellers should review where their customers receive taxable products or services, not just where the business, store, warehouse or office is located. A seller located in Philadelphia County or Allegheny County should not assume local tax applies to every Pennsylvania sale. Sales delivered outside those jurisdictions are not subject to local tax, while taxable sales delivered into Philadelphia County or Allegheny County should include the applicable local tax. Remote sellers should also be aware of the change. The analysis starts with whether they already have a Pennsylvania sales tax collection obligation, such as through economic nexus . If they do, they should evaluate whether local tax applies to taxable sales delivered into Philadelphia County or Allegheny County. The change makes customer delivery location more important for all sellers. Accurate address data and properly configured tax systems will help businesses avoid over-collecting or under-collecting local tax as Pennsylvania moves to destination-based sourcing. What should business owners do to adapt to the new sales tax rule? If you own a business that is located in Pennsylvania or has sales tax obligations there , you may be affected by the new tax rules for Philadelphia County and Allegheny County. Here’s what to do: Consult with your tax advisor. State and local tax rules are challenging to navigate on your own, so ask your tax advisor to determine if and how you are affected by the new local tax rules. Make operational updates as needed. Depending on the guidance you receive from your tax advisor, you may need to make updates to your finance, sales and billing systems, as well as train your team on the new tax rules. Review with your accounting team. Check with your accounting team to ensure that you are properly accounting for the new tax requirements. Read more Tax nexus: the state sales tax rule businesses must know Economic nexus reporting requirements reference table Gross receipts taxes: How could they affect your business?
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California expands sales tax to software: What businesses need to know
With the passage of Senate Bill 122 , California has enacted one of its most significant sales and use tax changes in years. Beginning January 1, 2027, the state will begin charging sales tax on many software transactions that historically weren’t taxed. The change is expected to generate nearly $900 million in annual revenue and will affect both software providers and businesses that purchase software in California. Here are the key provisions businesses should be paying attention to. SaaS and electronically delivered software will generally become taxable Historically, California sales tax primarily applied to transfers of tangible personal property. Many cloud-based software and electronically delivered software transactions fell outside the tax base. Starting in 2027, California will treat certain digital software products as tangible personal property for sales and use tax purposes. As a result, sales tax will generally apply to: Prewritten software delivered electronically Software accessed remotely through the cloud Software-as-a-service (SaaS) subscriptions and similar software offerings Software delivered on physical media This represents a significant shift for businesses that historically have not collected or paid California sales tax on these transactions. Not all digital products are taxable While the legislation significantly expands the taxation of software, it does not create a broad tax on all digital products. The following products generally remain outside the scope of the new law: Digital books Digital audiovisual works Video games, including those transferred electronically or accessed remotely Certain digital infrastructure offerings Cryptographically secured digital assets Custom software transactions also generally remain excluded. Certain exemptions remain available Although the law significantly expands the tax base, several important exclusions and special rules remain. Examples include: Temporary storage of software in California for deployment and use outside the state Certain software resale transactions involving “golden masters” Multiple-points-of-use provisions and credits for tax paid to other states Additional guidance is expected from the California Department of Tax and Fee Administration (CDTFA) on how these provisions will be administered. Local taxes can increase the overall tax burden The impact extends beyond California’s statewide sales tax. Because local and district taxes generally follow the state tax base, taxable software transactions may also be subject to local taxes, potentially increasing the overall tax rate depending on the consumer’s location. The legislation establishes sourcing rules designed to determine the appropriate local jurisdiction for electronically delivered and remotely accessed software. Technology transfer agreements are affected The legislation also changes the tax treatment of certain software technology transfer agreements (TTAs). For agreements entered into on or after January 1, 2027, favorable exclusions previously available for qualifying software transactions may no longer apply. In addition, certain ongoing lease arrangements may become taxable for payments due on or after the effective date. CDTFA is also expected to provide more guidance on how these provisions will be administered. Retailer relief for large sales to single customers If a retailer sells more than $5 million of taxable software or other digital products to the same customer during a calendar year, the retailer is not required to charge California tax on those sales. Instead, the purchaser becomes liable for remitting the tax on those transactions. Beginning January 1, 2028, the $5 million threshold will be based on purchases made during either the current or prior calendar year. What should businesses do now? While the new rules do not take effect until January 1, 2027, businesses should begin evaluating the potential impact now. Software providers should consider whether updates are needed to: Tax collection procedures Billing and invoicing systems Customer contracts Customer location sourcing methodologies Businesses purchasing software should evaluate: Increased sales and use tax costs Use tax accrual processes Budget impacts Multi-state software usage considerations Businesses that buy or sell software in California should review their contracts, systems and tax processes well before January 1 and monitor future CDTFA guidance as implementation details continue to develop. Read more Major updates in unclaimed property compliance Illinois’s fiscal 2027 omnibus budget bill enacts major tax changes Does your business need to pay taxes in a given state? The answer depends on nexus.
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Tax rules vary across jurisdictions, making it easy to miss risks or opportunities. Contact Wipfli’s tax advisors for help navigating complex requirements and identifying opportunities for savings.
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With deep tax law knowledge and decades of hands-on experience, Wipfli’s tax team is ready to help you navigate the tax landscape confidently and achieve your goals.
