Well of course when you are dealing with sub-contractors. Sub-contractors do 
not pay sales taxes. I was referring to the situation between Company A and the 
client directly. 

See the section titled Data Processing:
http://www.window.state.tx.us/taxinfo/taxpubs/tx96_259.html
05:46
_______________________________________________
Michelle McGonagle  |  Director of Business 
P: (512) 850-6490  |  [email protected]
6001 W Parmer Ln  |  Suite 370-108  |  Austin TX 78727
J Ortega Group | Twitter | Facebook
_______________________________________________

On Dec 29, 2009, at 11:40 AM, Eric Salys wrote:

> That is not correct according to my CPA.  Perhaps it is for your business and 
> your situation but it is not the case for all businesses and all situations.  
> Example:  Client hires Company A to develop a program.  Company A outsources 
> a part, or all, of it to Company B.  Company A does not pay taxes to Company 
> B because the taxes will be collected when Company A sells the final product 
> to the Client.  Otherwise it is double taxation.  There are lots of 
> situations in which taxes are not collected.  My suggestion is to join a CPA 
> discussion group rather than asking this group tax questions.
> 
> 
>  
> On Tue, Dec 29, 2009 at 12:02 AM, Michelle McGonagle 
> <[email protected]> wrote:
> According to Texas Sales Tax Law, any service rendered using a computer is 
> subject to sales tax if the client resides in Texas. 
> 
> _______________________________________________
> Michelle McGonagle  |  Director of Business 
> P: (512) 850-6490  |  [email protected]
> 6001 W Parmer Ln  |  Suite 370-108  |  Austin TX 78727
> J Ortega Group | Twitter | Facebook
> _______________________________________________
> 
> On Dec 27, 2009, at 9:57 AM, Daniel Short wrote:
> 
>> We're finally starting to get some local clients after doing most of
>> our development work for out-of-state companies. Is anyone here up to
>> speed on sales tax requirements for in-state design and development
>> services? I didn't have to charge tax for design services for in-state
>> clients when we were based out of California, but as a Texas
>> corporation I'm not entirely sure what the rules are.
>> 
>> Thanks,
>> 
>> Daniel Short
>> 
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