California AB176 modifies sales and use tax rules for digital products, exempting certain services and adjusting tax rates for businesses.

California AB176 amends the Revenue and Taxation Code to redefine "digital product" and adjust tax obligations for businesses. It exempts certain digital services from sales tax if they involve human effort post-customer request. The bill also modifies tax rates for limited liability companies and limited partnerships, exempting small businesses owned by deployed military members from certain taxes for their first year. Additionally, it introduces a tax on settlement fund payments related to specific legal cases, effective from 2026 to 2030.

California AB176 modifies sales and use tax rules for digital products, exempting certain services and adjusting tax rates for businesses.

California AB176 amends the Revenue and Taxation Code to redefine "digital product" and adjust tax obligations for businesses. It exempts certain digital services from sales tax if they involve human effort post-customer request. The bill also modifies tax rates for limited liability companies and limited partnerships, exempting small businesses owned by deployed military members from certain taxes for their first year. Additionally, it introduces a tax on settlement fund payments related to specific legal cases, effective from 2026 to 2030.