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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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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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Major updates in unclaimed property compliance
The unclaimed property compliance landscape saw significant change in 2026 as states expanded reporting obligations, adopted new rules governing digital assets and securities and revisited long-standing exemptions. At the same time, federal lawmakers increased scrutiny of state escheat practices through proposed legislation that could significantly alter the treatment of certain property types. For holders, these developments signal a growing compliance burden and a continued shift toward broader reporting requirements. Here’s a rundown of the states that have made notable changes: Arizona: SB 1336 eliminates longstanding exemptions Arizona enacted SB 1336 on June 22, 2026, repealing several long-standing exclusions from the state’s unclaimed property law. As a result, property previously exempt from reporting may now be subject to Arizona’s unclaimed property requirements, including: Gift cards and gift certificates; stored-value cards; merchandise points and loyalty rewards; frequent flyer miles; prepaid phone cards; nonrefundable tickets and de minimis property. The legislation also repeals Arizona’s business-to-business (B2B) exemption. Property that may now be reportable includes customer and vendor credit balances, accounts receivable credits, accounts payable checks, refunds, rebates and other obligations arising from commercial relationships. For many businesses, this represents a significant expansion of potential reporting obligations, particularly for companies that have historically relied on the B2B exemption to exclude outstanding credits and other commercial liabilities. The law becomes effective September 12, 2026. Because Arizona’s statutes provide limited dormancy guidance for several of these newly reportable property types, holders are awaiting additional administrative guidance on implementation and reporting requirements. Florida: SB 1452 modernizes Chapter 717 Effective immediately upon enactment on June 26, 2026, Florida’s SB 1452 introduces several important updates to the state’s unclaimed property law. Among other changes, the legislation clarifies when property becomes payable or distributable for dormancy purposes; revises the treatment of stock, equity interests and debt of business associations; and excludes certain non-freely transferable securities and worthless securities from the category of reportable intangible property. The bill is particularly important for financial institutions, brokerage firms, transfer agents and companies holding securities-related property because it provides additional guidance regarding owner activity, abandonment standards and securities reporting obligations. Digital assets and unclaimed property compliance No area of unclaimed property law evolved more rapidly in 2026 than digital assets. As cryptocurrency and other digital financial assets continue to gain mainstream adoption, states are increasingly establishing rules governing how these assets are reported, transferred, liquidated and returned to owners. Virginia: HB 798 Virginia enacted HB 798, creating a statutory framework for digital assets under the Virginia Disposition of Unclaimed Property Act. The legislation establishes definitions, reporting requirements and remittance procedures for digital assets, including digital representations of value used as a medium of exchange or store of value. The law was approved on April 13, 2026, and became effective July 1, 2026. Minnesota: HF 4188 Minnesota enacted HF 4188, which expressly incorporates virtual currency into the state’s unclaimed property regime. Key provisions include virtual currency is presumed to be abandoned after three years of owner inactivity; specific forms of owner activity prevent abandonment; holders generally must liquidate virtual currency before reporting; cash proceeds are remitted to the state, and holders receive liability protection for compliant remittances. The legislation was signed on May 27, 2026, and became effective on August 1, 2026. Maine: LD 1969 (Public Law Chapter 675) Maine enacted LD 1969, adding virtual currency to its unclaimed property law. The legislation defines virtual currency, establishes dormancy and reporting requirements and provides guidance regarding remittance obligations. The law becomes effective July 29, 2026. Louisiana: HB 1256 (Act 891) Louisiana enacted HB 1256, one of the most comprehensive digital asset escheat bills adopted to date. The bill defines digital assets to include virtual currency, cryptocurrency, stablecoins and other digital-only assets. It creates a three-year dormancy period for digital asset accounts and allows for these to be transferred in native form to a designated custodian. The law further establishes liquidation procedures and liability protections and creates reporting and custody standards unique to digital assets. The bill was signed into law on June 9, 2026, and becomes effective January 1, 2027. Federal developments to watch Federal involvement in unclaimed property increased significantly in 2026 with the introduction of the Safeguarding Americans’ Fairly Earned Retirement Act (SAFER Act). If enacted, the legislation would significantly restrict the circumstances under which states may take custody of securities, investment accounts, IRAs, digital assets, dividends and investment proceeds. Among its most notable provisions: Individual accounts generally could not be escheated without confirmation of the owner’s death. Entity-owned accounts generally would be protected until at least five years have passed without contact from an authorized representative. As of July 2026, the legislation remains pending in Congress. Should it become law, it would represent one of the most significant federal interventions in state unclaimed property law in decades. What now? The trend is clear: States are expanding the scope of reportable property while simultaneously increasing scrutiny of emerging asset classes such as cryptocurrency and digital financial assets. With multiple states adopting significant changes in 2026 and additional legislation expected in 2027, proactive compliance reviews can help minimize risk and avoid costly reporting issues. Read more Abandoned property rules: The beginner’s guide to compliance NAUPA III compliance: Is your company ready for the changes? Cryptocurrency’s next curveball: Why fintech leaders need to act now
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Illinois’ fiscal 2027 omnibus budget bill enacts major tax changes
On June 16, 2026, Illinois Gov. JB Pritzker signed the state’s fiscal 2027 omnibus budget bill ( S.B. 3019 ) into law. The bill makes significant tax changes, including: Raising the net loss deduction (NLD) cap under the corporate income tax starting in 2027. Creating an optional pass-through entity tax calculation for Illinois resident partners and decouples from the Sec. 1202 qualified small business stock gain exemption, both starting in 2026. Imposing new taxes on targeted advertising services, social media platforms and certain digital asset transactions, effective January 1, 2027. Gov. Pritzker also directed the Illinois Department of Commerce and Economic Opportunity to pause processing of agreements under its Data Center Investment Program, effective July 1, 2026. Corporate net loss deduction cap increase Since 2021, Illinois has imposed a cap on the amount of NLD that corporate income taxpayers may claim each year. From 2021 to 2023, they were capped at $100,000 per year, and from 2024 to 2026, they are capped at $500,000 per year. Beginning with tax years ending on or after December 31, 2027, the cap will be the greater of $500,000 per tax year, or a certain percentage of the corporation’s net income for the year: Tax year Flat-dollar deduction Percentage of net income 2027 $500,000 15% 2028 $500,000 30% 2029 $500,000 50% 2030 $500,000 65% 2031 $500,000 80% Pass-through entity (PTE) tax expansion For tax years ending on or after January 31, 2026, partnerships may elect to compute their resident partners’ portion of the elective PTE tax using those partners’ share of the entity’s unapportioned income (the “full distributive share” method), or their share of the entity’s income apportioned to Illinois (the “Illinois-sourced income” method). This election will be made annually and applies to all partners for the taxable year. Because the purpose of a PTE tax is to create a federal income tax deduction for the pass-through entity that it would not otherwise be entitled to, many Illinois residents may welcome the opportunity to increase their Illinois PTE tax by electing to use the “full distributive share” method for 2026 and beyond. For Illinois nonresident partners and for Illinois resident and nonresident S corporation shareholders, the PTE Tax will continue to be imposed on the entity’s income apportioned to Illinois. Section 1202 decoupling Under IRS Code Sec. 1202, individuals may avoid paying federal income tax for up to 100% of the otherwise taxable gain recognized on the sale of qualified small business corporation stock (QSBS). Even though Illinois has historically conformed to Sec. 1202, effective for tax years ending on or after December 31, 2026, Illinois will fully decouple from Code Sec. 1202 and include the gain on the sale of QSBS stock in the state income tax base. Targeted advertising services tax (digital ad tax) Effective January 1, 2027, SB 3019 imposes a 10% tax on the gross receipts of companies that provide targeted advertising services (TAS) in the state. The tax first applies to a company if, at the end of any calendar quarter, its cumulative gross TAS receipts in Illinois exceeded $1M during the prior 12 months. Once a company meets that threshold, it must pay the tax monthly for the following 12 months. “Targeted advertising services” are any programmatic written, oral or graphic statements conveyed via digital interfaces or other means that use personal information about the people to whom the ads are being served. Examples are banner ads and search engine ads. The TAS tax does not apply to ads provided on digital interfaces that are owned and/or operated by news media entities. Illinois localities are prohibited from implementing their own TAS taxes. Social media platform fee Effective January 1, 2027, Illinois will impose a monthly fee on for-profit “social media platforms.” The tax uses a graduated rate based on the number of monthly Illinois users the platform collects data from: Monthly Illinois users Fee per user Monthly tax calculation Under 100,000 N/A N/A 100,001–500,000 $0.10 per user Imposed on IL users over 100,000 but not over 500,000 500,001–1,000,000 $0.25 per user $40,000 plus $0.25 per Illinois user over 500,000 Over 1,000,000 $0.50 per user $165,000 plus $0.50 per Illinois user over 1,000,000 Even though Gov. Pritzker clarified that the fee will be levied on social media platforms, not users, the law’s prohibition against providers passing the tax to their consumers is similar to a prohibition in Maryland that was struck down in 2025 on First Amendment grounds. The state’s new social media platform fee is similar to Chicago’s Social Media Amusement Tax (SMAT), which took effect January 1, 2026. Chicago’s tax applies to for-profit “social media businesses” that collect consumer data from more than 100,000 Chicago consumers in a calendar year. The SMAT rate is 50 cents for each consumer over 100,000, computed monthly. Digital asset transfer tax (DAT) Effective January 1, 2027, Illinois will impose a tax on digital asset brokers that engage in digital asset business activity with an Illinois customer. It appears that this may be the first tax in the nation to target cryptocurrency. “Digital asset business activity” is defined to mean any single occurrence of exchanging, transferring or storing a “digital asset” (e.g., cryptocurrency, tokens, stablecoins) as part of a business or on behalf of a customer who has entered into an agreement with a business for those services. The DAT applies to any digital asset broker with a physical presence in Illinois or economic nexus with the state (i.e., at least $100,000 in gross receipts from digital asset business activity sales to Illinois customers). The tax rate is 0.2% on the value of digital assets exchanged, transferred or stored in the state. Pause in approving new data center tax incentives In mid-2019, Gov. Pritzker signed bipartisan legislation (P./A. 101-31) that established the Data Center Investment Program (DCIP) to attract technology infrastructure to Illinois. Under the DCIP, data center owners and operators could qualify for sales/use tax exemptions on center-related purchases, as well as a credit equal to 20% of wages paid to construction workers for projects in underserved areas. On June 5, 2026, Gov. Pritzker ordered the Illinois Department of Commerce and Economic Opportunity (DCEO) to pause processing of agreements under the DCIP effective July 1, 2026. Under this order, Gov. Pritzker confirmed that “existing incentive agreements under the Data Center Investment Program, including those entered into with DCEO before July 1, 2026, will be honored.” Read more Does your business need to pay taxes in a given state? The answer depends on nexus. Colorado just enacted 4 major state tax changes. What do taxpayers need to know? Marketplace facilitator tax: Rules, compliance requirements and considerations for businesses
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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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