Bundled Transactions

​Bundled Transactions

Statutes: Sections 77.51(1f), (3pf), (9p), (12m)(a), and (15b)(a); 77.52(20) to (23); and 77.54(51) and (52) Wis. Stats. (2015-16)

Wis. Adm. Code: Sections Tax 11.67(2)(c) and Tax 11.985, Wis. Adm. Code (November 2010 Register)

Introduction:

This tax release explains the tax treatment of bundled transactions. For purposes of this tax release:

Definitions:

"Distinct and identifiable" products and/or services do not include either of the following:

  • Packaging, including containers, boxes, sacks, bags, bottles, and envelopes; and other materials, including wrapping, labels, tags, and instruction guides; that accompany, and are incidental or immaterial to, the retail sale of any product and/or service
  • A product and/or services that is provided free of charge to the consumer in conjunction with the required purchase of another product and/or service, if the sales price of the other product and/or service does not vary depending on whether the product and/or service provided free of charge is included in the transaction

"Distinct and identifiable" products and/or services also do not include any items included in the definitions of "purchase price" or "sales price."  (Section 77.51(12m)(a) or (15b)(a), Wis. Stats., respectively)

"One non-itemized price" does not include a price that is separately identified by product on a binding sales document, or other sales-related document, that is made available to the customer in paper or electronic form, including an invoice, a bill of sale, a receipt, a contract, a service agreement, a lease agreement, a periodic notice of rates and services, a rate card, or a price list.

What Is a Bundled Transaction?

A "bundled transaction" is the retail sale of two or more products and/or services, not including real property and services to real property, if the products and/or services are distinct and identifiable and sold for one non-itemized price.

Certain exceptions apply. See "Tax Treatment for Transaction That Are Not Bundled Transactions," below.

Tax Treatment for Bundled Transactions

Bundled Transactions Are Taxable. If at least one of the products and/or services sold in a "bundled transaction" is subject to tax, the entire sales price of the bundled transaction is subject to tax. In some cases, the retailer has the option to collect and pay tax on only the taxable portion of the non-itemized sales price.

Retailer Has Option to Collect and Pay Tax on Taxable Portion. When a retailer identifies (by reasonable and verifiable standards from the retailer's books and records that are kept in the ordinary course of its business) the portion of the sales price attributable to products and/or services that are not subject to the tax, the retailer may collect and pay tax on only the portion of the sales price attributable to the taxable products and/or services. This option does not apply to a bundled transaction that contains food and food ingredients, drugs, durable medical equipment, mobility-enhancing equipment, prosthetic devices, or medical supplies.

Tax Treatment for Transactions That Are Not Bundled Transactions

The definition of "bundled transaction" provides specific situations in which a transaction is not a "bundled transaction," even if it is the sale of two or more distinct and identifiable products that are sold for one nonitemized price and does not include real property or services to real property. The tax treatment of these situations is described, below.

  1. Price Varies or Is Negotiable Based on Purchaser's Selection of Products and/or Services - The sale of any products and/or services for which the sales price varies or is negotiable based on the purchaser's selection of the products and/or services included in the transaction. (NOT a bundled transaction)

    TAX TREATMENT: The sales and use tax treatment of the transaction follows the tax treatment of the product(s) and/or services being sold. The tax treatment of the products and/or services sold is not affected by the bundled transaction provisions.

    Example: Information Technology and Data Processing Services Provided for Fee Negotiated Based on Products Selected (Price Varies Based on Purchaser's Selection of Products and/or Services)

    Company enters into a multi-year contract with its customer to provide information technology services which include:

    • Software installation
    • Data processing
    • Help desk support
    • Web hosting

    Help desk support includes (a) telephone support where customer fixes problems while receiving instructions from a person on the telephone, and (b) remote access support where a person at the help desk remotely accesses customer's software/hardware and fixes the problem. Through negotiation, Company and its customer agree on the services to be provided and the price. The price is based on the mix of services to be provided. Company bills one non-itemized price on its invoice to its customer.

    The taxable products include help desk support where a person at the help desk remotely accesses customer's software/hardware and fixes the problem and software installation. The nontaxable products include help desk support where the support person provides directions, by telephone, to the customer so that the customer can fix the problem. Other nontaxable products are data processing and web hosting. Because the price of products and/or services being sold varied or was negotiated as a result of the selection by the customer of the products and/or services included in the transaction, the sale is not a bundled transaction.

    If taxable and nontaxable products and/or services are provided, Company may make a reasonable allocation of the total sales price and collect and remit tax based on the amount allocated to the taxable products and/or services sold. If no allocation is made, the entire charge is subject to tax, as provided in sec. Tax 11.67(2)(c)1., Wis. Adm. Code (November 2010 Register).

  2. Product Provided With Service and True Objective Is Service - The retail sale of a service and taxable products; if ALL of the following apply:

    • The taxable product is essential to the use of the service
    • The taxable product is provided exclusively in connection with the service
    • The true object of the transaction is the service

      (NOT a bundled transaction)

    TAX TREATMENT: The sales and use tax treatment of the transaction follows the tax treatment of the service provided. The service provider is required to pay tax on its purchase of the taxable products that are essential to the use or receipt of the service.

    Exception: If the service provided is subject to tax under sec. 77.52(2)(a)7., 10., 11., or 20., Wis. Stats., the service provider may purchase the products without tax, for resale, that are provided with the service.

    Example –Training Manual with Educational Services (Product Is Provided with Service and True Objective Is Service)

    Educational Provider offers a one-day live educational seminar with a comprehensive training manual for $400. Educational Provider does not sell either the educational seminar or the training manual separately. Since the manual is (1) essential to the educational service, (b) provided exclusively in connection with the educational service, and (c) the true object of the transaction is to receive the educational service, the sale is not a bundled transaction.

    The $400 fee is not subject to tax. Educational Provider's purchase of the training manual is subject to tax. (Section 77.52(22), Wis. Stats.)

  3. Two or More Services and True Objective Is One of Services - The retail sale of services, if both of the following apply:

    • One of the services is essential to the use or receipt of a primary service, and is provided exclusively in connection with the primary service
    • The true object of the transaction is the primary service

      (NOT a bundled transaction)

    TAX TREATMENT: The tax treatment of the transaction follows the tax treatment of the primary service that is being provided, unless the department determines that allocation more accurately reflects the tax. The service provider is required to pay the applicable tax on its purchase of the service that is essential to the use or receipt of the second service.

    Exception: If the service being provided is subject to tax under sec. 77.52(2)(a)7., 10., 11., or 20., Wis. Stats., the service provider may purchase the products without tax, for resale, that are provided with the service.

    Example – Parking Provided Exclusively with Educational Service (Two or More Services and True Objective Is Second Service)

    Educational Provider holds a workshop at an exhibition hall. Educational Provider rents the hall from one party for $5,000 and rents the nearby parking lot from another party for $1,000 for the day of the workshop. Attendees are charged $500 to attend the workshop, regardless of whether or not the attendee uses the parking lot. No one other than workshop attendees may park in the parking lot on the day of the workshop. Since the parking is (1) essential to the educational service, (b) provided exclusively in connection with the educational service, and (c) the true object of the transaction is to receive the educational service, the sale is not a bundled transaction.

    The $500 workshop fee is not subject to tax. Educational Provider's rental of the hall that is used for the workshop is not taxable. However, Educational Provider's rental of the parking lot is subject to sales or use tax, since Educational Provider is purchasing taxable parking services that it uses in providing its educational services. (Section 77.52(23), Wis. Stats.)

  4. 10% or Less of Price Relates to Taxable Products and Services - A transaction that includes taxable and nontaxable products and/or services, if the seller's total purchase price or sales price of the taxable products and/or services is not greater than 10% of the seller's total purchase price or sales price of all the bundled products and/or services. The seller must determine this percentage using either the seller's purchase price or sales price, but not a combination of both, or, in the case of a service contract, the full term of the service contract. (NOT a bundled transaction)

    TAX TREATMENT: The transaction is not subject to sales or use tax. However, the first person combining the products and/or services is required to pay the applicable Wisconsin sales or use tax on its purchase price of the taxable products and/or services included in the transaction.

    Note: This tax treatment does not apply if the transaction includes food and food ingredients, drugs, durable medical equipment, mobility-enhancing equipment, prosthetic devices, or medical supplies. See #5, below.

    Example 1:Website and Social Media Management Services (10% or Less of Price Relates to Taxable Products and Services)

    Company sells website and social media management services for $1,500 per month. Company will store and maintain a customer website and database on its server.

    Company will post updates on the customer's website and develop and post a new "Satisfied Customer Video" on the website each month. Company will also perform data processing services to the database that include making address and other account information changes and subscriber deletions. The customer's social media website will be maintained by Company, and Company will post daily notices on the social media website.

    Company's sale of the monthly "Satisfied Customer Video" is the sale of a digital audiovisual work, which is taxable as an additional digital good. Company's services of storing and maintaining the website and database, posting of updates to the customer's website, and performing data processing services are not subject to tax. Assuming that the taxable product does not account for more than 10% of the seller's sales price or purchase price, Company's sale of the website and social media management services is not a bundled transaction.

    Company's $1,500 monthly charge for database and social media management services is not subject to tax. Company must pay tax on its purchase of any taxable products or services used to provide its products and services.

    Example 2:Flag Kit (10% or Less of the Products Are Taxable and First Person Combining the Products Owes Tax on Purchases)

    Company manufacturers various components of a flag kit and buys some components for the flag kit from third parties. Company packages the components into a flag kit, which is sold as a single unit. The flag kit includes a United States flag and related accessories, such as a mounting bracket, a flagpole, a cord, and instructions on the display of the flag. Company's purchase price and sales price of the taxable products included in the flag kit are not greater than 10% of Company's total purchase price or sales price of all of the products in the flag kit.

    Company sells the flag kits to Retailer, who gives Company an exemption certificate claiming the resale exemption. Retailer sells the flag kits to customers who use the flag kits. Company's sale of the flag kit to Retailer is not a retail sale (i.e., it is a sale for resale).

    Retailer's sale of the flag kit is not subject to tax. Since Retailer was not "the first person combining the products," Retailer is not liable for tax on the flag kit that it purchased from Company without tax, for resale. Since Company's sale of the flag kit was not a retail sale (i.e., it was a sale to Retailer for resale), no use tax liability is incurred by Company on its purchase of the components of the flag kit.

  5. Food or Medical Products – 50% or Less of Price Relates to Taxable Products - The retail sale of products; if ALL of the following apply:

    • The transaction includes both taxable and exempt products and no services
    • The transaction includes food and food ingredients, drugs, durable medical equipment, mobility-enhancing equipment, prosthetic devices, or medical supplies
    • The seller's purchase price or sales price of the taxable products is not greater than 50% of the seller's total purchase price or sales price, respectively, of all the products included in what would otherwise be a bundled transaction. The seller must determine this percentage using either the seller's purchase price or sales price, but not a combination of both

      (NOT a bundled transaction)

    TAX TREATMENT: The transaction is not subject to sales or use tax. The person combining the products is not required to pay Wisconsin sales or use tax on its purchase price of the taxable products included in the transaction.

    Exception: If the service being provided is subject to tax under sec. 77.52(2)(a)7., 10., 11., or 20., Wis. Stats., the service provider may purchase the products without tax, for resale, that are provided with the service.

    Example – Gift Basket (Food or Medical Products –50% or Less of Price Relates to Taxable Products)

    Retailer sells a gift basket for $30.00 that includes a basket, fresh fruit, a package of hot cocoa mix, and a bag of candy. Retailer's books and records show the purchase price and selling price of each of the products as follows:

    ItemCostSelling Price
    Basket$ 1.00$ 3.00
    Fresh Fruit$ 6.00$15.00
    Cocoa Mix$ 3.00$ 7.00
    Candy$ 2.00$ 5.00
    Totals$12.00$30.00

    The fresh fruit and cocoa mix are products that are not subject to tax. The basket and candy are products that are subject to tax. The taxable products (i.e., basket and candy) are 50% or less of Retailer's total purchase price and sales price, respectively, of all the products included in the gift basket.

    The sale is not a bundled transaction. The non-itemized charge of $30.00 is not subject to tax. Retailer's purchase of the basket and everything in basket is exempt from tax under sec. 77.54(52), Wis. Stats.

    See the following articles for similar examples:

  6. Products Provided Free of Charge With Required Purchase - Products and/or services are not distinct and identifiable when the product and/or service is provided free of charge to the consumer in conjunction with the required purchase of another product and/or service, and the sales price of the other product and/or service does not vary depending on whether the product and/or service provided free of charge is included in the transaction. (NOT a bundled transaction)

    TAX TREATMENT: The tax treatment of the entire sales price is based on whether the other product (non-free product) is a taxable or nontaxable product. The person providing the product and/or service free of charge is required to pay sales or use tax on its purchase price of the product and/or service.

    Exception: If the person receiving the free product and/or service must also purchase another taxable product and/or taxable service in the same transaction to receive the free product and/or service, the person providing the product and/or service in the same transaction may purchase the product and/or service provided free of charge without tax, for resale, unless the free product and/or service is transferred incidentally with a taxable service, as provided in sec. 77.52(2m)(a), Wis. Stats.

    Example – Free Hat with Purchase of Gasoline (Products Provided Free of Charge with Required Purchase)

    Retailer provides a hat free of charge to any customer that purchases a certain number of gallons of gasoline. Since the gasoline is subject to excise tax under ch. 78, Wis. Stats., the gasoline is exempt from sales and use taxes. The price of the gasoline does not vary depending on whether the hat is included in the transaction. Since the hat is provided free of charge, it is not a "distinct and identifiable product." Only one distinct and identifiable product (i.e., the gasoline) is sold in this transaction.

    The transaction is not a bundled transaction. Retailer is the consumer of these hats and is required to pay Wisconsin sales or use tax on its purchases of the hats.

    See the tax release titled "Buy One, Get One Free" and Similar Promotions, which was published in Wisconsin Tax Bulletin #174 (January 2012), for other examples of products provided free with the required purchase of another product.

  7. Real Property - A transaction that includes real property or service to real property. (NOT a bundled transaction)

    TAX TREATMENT: For the tax treatment of real property construction activities, see Part 12 of Publication 201, Wisconsin Sales and Use Tax Information, and Publication 207, Sales Tax Information for Contractors.

    Example – Sale of Appliance Package(Real Property)

    Appliance Store sells an appliance package that includes a stove, refrigerator, and dishwasher for one non-itemized price. The appliances may not be purchased individually. Appliance Store delivers and installs the appliances. The dishwasher is a built-in appliance and is a real property improvement when sold installed. The stove and refrigerator are tangible personal property when installed. Since the transaction includes real property, the sale is not a bundled transaction.

    Appliance Store must make an allocation for the taxable and nontaxable products:

    • Appliance Store's sale of the installed dishwasher is not subject to tax, since the sale of a real property improvement is not taxable.
    • Appliance Store is the consumer of the dishwasher and is required to pay Wisconsin sales or use tax on its purchase of the dishwasher.
    • Appliance Store's sale of the installed stove and refrigerator is subject to tax, since the sale of tangible personal property is taxable.
    • Appliance Store may purchase the stove and refrigerator without tax, for resale.

    Bundled Transaction Flowchart

    A flowchart to aid in determining whether a transaction is a bundled transaction is included at the end of this tax release.

    Bundled Transactions Examples

    • Example 1 – Subscription Fee
    • Example 2 – Gift Basket - Contains Food and More Than 50% of Products Are Taxable
    • Example 3 – Contact Lens Travel Kit - Contains Drug and More Than 50% of Products Are Taxable
    • Example 4 – Handicap Accessible Equipment Sold With Motor Vehicle - Contains Exempt Mobility Enhancing Equipment and 10% or Less of Sales Price Relates to Exempt Mobility Enhancing Equipment
    • Example 5 – Self-Study Review Course Package - More Than 10% of Price Relates to Taxable Products and/or Services
    • Example 6 – Travel Package - More Than 10% of the Price Relates to Taxable Products and/or Services
    • Example 7 – Flag Kit - Example to Illustrate How to Use the Bundled Transaction Flowchart at the End of this Tax Release

    Example 1 – Subscription Fee

    For a single monthly subscription fee of $300, Company provides the following information and services relating to commodities in a given industry:

    1. Access to real-time prices on Company's website
    2. Ability to view live feeds of different commodities exchanges
    3. Ability to receive text messages on prices from different commodities exchanges
    4. Ability to receive price alerts related to changes in prices in the different commodities exchanges
    5. Access to daily commentaries from trading floors of the exchanges
    6. Ability to use prewritten computer software, which is owned and maintained by the seller, to calculate commodity values*
    7. Access to database containing historical information for research purposes
    8. Access to archived news articles

      *The use of the software is a nontaxable data processing service.

    The taxable products and/or services in this example are items 1 - 5 (i.e., the real-time prices, the live feeds, the text messages, the price alerts, and the daily commentaries). The nontaxable products and/or services are items 6 - 8 (i.e., the ability to use the software, the ability to review historical data, and the access to the news archives).

    Company's purchase price of items 1 - 5 is more than 10% of its total sales price of all the items listed above.  Company's sales price of items 1 – 5 is also more than 10% of its total sales price of all of the items listed above.

    The sale is a bundled transaction. The $300 non-itemized charge for the subscription to the information and services is subject to Wisconsin sales or use tax.

    Note: If Company can identify, by reasonable and verifiable standards from Company's books and records, the portion of the sales price that is attributable to the products and/or services that are not subject to tax, Company is only required to charge Wisconsin sales tax on the taxable products and/or services.

    Example 2 – Gift Basket (Contains Food and More Than 50% of Products Are Taxable)

    Retailer sells a gift basket for a non-itemized price of $30 that includes a basket, three oranges, two apples, and a box of candy. Retailer's books and records show the cost and selling price of each of the products included in the basket as follows:

    ItemCostSelling Price
    Basket$ 1.00$ 3.00
    Oranges$ 3.00 $ 4.00
    Apples$ 2.00 $ 4.00
    Candy$12.00$19.00
    Totals $18.00$30.00

    The oranges and apples are products that are not subject to tax. The basket and candy are products that are subject to tax. The taxable products (i.e., basket and candy) are 50% or more of Retailer's total purchase price and sales price, respectively, of all the products included in the gift basket.

    The sale is a bundled transaction. The non-itemized charge of $30.00 is subject to tax. Retailer may purchase the basket and all of the products included in the gift basket without tax.

    Note: Since the transaction includes food, Retailer does not have the option to collect and remit sales tax only on the portion of the sales price that is attributable to taxable products. Retailer's entire sales price is subject to tax.

    See the following articles for similar examples:


    Example 3 – Contact Lens Travel Kit (Contains Drug and More Than 50% of Products Are Taxable)

    Retailer sells contact lens travel kits for a $10.00 non-itemized price that contain both taxable (contact lens solution) and nontaxable (contact lens case, travel case) products. The contact solution is a drug. Retailer's books and records show the purchase price and selling price of each of the products as follows:

    ItemCostSelling Price
    Contact Lens Case$ 0.75$ 2.50
    Travel Case$ 0.75$ 2.50
    Contact Lens Solution$ 2.00$ 5.00
    Totals $ 3.75$10.00

    The contact lens case and travel case are products not subject to tax. The contact lens solution is a product subject to tax, and the contact lens solution is a drug. The sales price of the taxable product (i.e., contact lens solution) is 50% or more of Retailer's total purchase price and sales price, respectively, of all the products included in the gift basket.

    The sale is a bundled transaction. The $10.00 non-itemized price is subject to tax.

    Retailer may purchase all of the products included in the contact lens travel kit without tax.

    Note: Since the transaction includes drugs, Retailer does not have the option to collect and remit sales tax only on the portion of the sales price that is attributable to taxable products. Retailer's entire sales price is subject to tax.

    Example 4 – Handicap Accessible Equipment Sold With Motor Vehicle (Contains Exempt Mobility Enhancing Equipment and 10% or Less of Sales Price Relates to Exempt Mobility Enhancing Equipment)

    Individual A purchased a van and handicap accessible equipment five years ago and paid $50,000 for the van and $20,000 for the handicap accessible equipment. The current value of the van is $20,000 and the current value of the handicap accessible equipment is $10,000. Individual A sells the van and equipment to Individual B for one non-itemized price of $30,000.

    The handicap accessible equipment is exempt from sales and use tax as mobility-enhancing equipment, while the van is taxable. The taxable product (i.e., the van) is more than 50% of the seller's purchase price and sales price, respectively, for the van and the mobility-enhancing equipment.

    The sale is a bundled transaction. The $30,000 non-itemized charge is subject to tax.

    Note: If the seller separately states the amount of the mobility-enhancing equipment, the amount charged for the mobility-enhancing equipment is not subject to tax. In order to separately state the portion of the selling price allocable to the mobility-enhancing equipment, the seller may use the following method:

    1. Selling price of a used vehicle which contains the mobility-enhancing equipment$ XX,XXX
    2. Selling price of the same year, make,and model of used vehicle not containing the mobility-enhancing equipment$ YY,YYY
    3. Subtract line 2 from line 1. This is the portion of the selling price equipment that the which is attributable to the mobility-enhancing seller may separately state as exempt from sales and use taxes$ ZZ,ZZZ

    Example 5 – Self-Study Review Course Package (More Than 10% of Price Relates to Taxable Products and/or Services)

    School charges $300 for a self-study review package that customers purchase in preparation for an upcoming professional credentialing exam. The self-study review package includes a study manual, flashcards, and videos on DVDs. The package also includes online access using the Internet and a password to databases of frequently asked questions and questions from previous exams, archived video lectures, an interactive blog where the customer can communicate with other customers and where various tips are posted relating to the exam, and an email address for sending questions. The purchaser is not required to take any tests that are scored to show that he or she completed the review course. The price for each individual item is not stated separately and the price cannot be reduced based on individual items not used.

    The taxable products include the study manual, flashcards, video DVDs, online access to archived lectures, use of the interactive blog, and email account. The nontaxable products include online access to databases of frequently asked questions and questions from previous exams. The taxable products are more than 10% of School's sales price and purchase price.

    The sale of the self-study review course package is a bundled transaction. The non-itemized charge of $300 is subject to tax. School may purchase the study manual, flashcards, video DVDs, and archived video lectures (if purchased) without tax, for resale.

    Note: If School can identify, by reasonable and verifiable standards from School's books and records, that portion of the sales price that is attributable to the nontaxable products and services, School is only required to charge Wisconsin sales tax on the taxable products and/or services.

    Example 6 – Travel Package (More Than 10% of Price Relates to Taxable Products and/or Services)

    Travel Agent sells a package for a single non-itemized price of $400. The package includes one ticket to a professional sporting event in Milwaukee, one night lodging at a Milwaukee hotel, and round-trip transportation to the sporting event from Wausau. The sales price of the package does not vary and is not negotiable based on a customer's selection of the products in the package. Travel Agent purchases the ticket directly from Event Provider, the lodging directly from Hotel, and the transportation directly from Transportation Company. The taxable services (i.e., the admission ticket and the lodging) are more than 10% of Travel Agent's sales price and purchase price.

    Travel Agent's sale of the package is a bundled transaction. The non-itemized charge of $400 is subject to tax. Travel Agent may purchase the ticket and lodging without tax, for resale.

    Note: If Travel Agent can identify, by reasonable and verifiable standards from Travel Agent 's books and records, that portion of the sales price that is attributable to the services that are not subject to tax, Travel Agent is only required to charge Wisconsin sales tax on the taxable services.

    Additional information about travel packages is provided in Examples 15 and 16 of the tax release titled "Admissions to Amusement, Athletic, Entertainment, or Recreational Events or Places."

    Example 7 – Flag Kit (Example to Illustrate How to Use the Bundled Transaction Flowchart at the End of this Tax Release)

    Retailer sells an eight-foot sectional "flag kit" consisting of a two-piece pole with an eagle affixed to the top, a cord, an attaching bracket and screws, and a U.S. flag, all enclosed in a package with a single Universal Product Code (UPC). Retailer sells the "flag kit" to its customer, without installation, for a single non-itemized price of $50. Of the products that make up the "flag kit," the flag is exempt from Wisconsin sales and use tax, and the pole with eagle, cord, bracket, and screws are taxable.

    Retailer's
    Flag KitPurchase Price
    Flag$10.00
    Pole with eagle$ 8.00
    Cord$ 1.00
    Bracket$ 1.50
    Screws$ 0.50
    Total Purchase Price$21.00

    Taxable Portion - $11.00

    Taxable Percentage - 52.38%

    Since the retailer's purchase price of the taxable products is significantly higher than 10% of its total purchase price of all of the products in the flag kit, it can be presumed that the retailer's sales price of the taxable products in the flag kit are also more than 10% of the sales price of all of the products in the flag kit.

    Using the Bundled Transaction Flowchart:

    • Does the transaction include the retail sale of 2 or more products? Yes
    • Does the transaction include real property or a service to real property? No
    • Are the products distinct and identifiable? Yes
    • Are the products sold for one non-itemized price? Yes
    • Does the price vary or is the price negotiable based on products selected? No
    • Does the transaction include a service? No
    • Does the transaction include food and food ingredients, drugs, durable medical equipment, mobility-enhancing equipment, prosthetic devices, or medical supplies? No
    • Are the taxable products more than 10% of the total price? Yes

    The sale is a bundled transaction. The $50.00 non-itemized price is subject to tax.

    Note: Retailer may, at its option, collect and remit tax only on the taxable portion of the sale if Retailer can identify, by reasonable and verifiable standards from its books and records that are kept in the ordinary course of its business, the portion of the sales price that is attributable to products that are not subject to tax (e.g., selling price of $50.00 x 52.38% = $26.19 subject to tax).

Bundled Transaction Flowchart to determine if the retail sale of 2 or more products is a bundled transaction  

Notes to Bundled Transactions Flowchart  

April 30, 2018