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Bundled Transactions & the True Object Test for US Sales Tax

  • Bundled transactions involve selling two or more products or services for a single price.
  • Products must be distinct and separately identifiable.
  • The True Object Test determines the primary purpose of a bundled transaction.
  • If the primary purpose is the tangible good, the transaction is usually taxable.
  • If the primary purpose is the service, the transaction is usually non-taxable.

Source: vatabout.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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