On July 1, 2024, Tennessee will join the Streamlined Sales Tax (SST) program, making it easier for sellers to determine where to pay sales tax. The new rules focus on destination-based sourcing and simplify tax compliance for interstate sellers by establishing clear rules for determining which jurisdiction receives the sales tax.

The bottom line: Services related to tangible personal property (like computer software) will be taxed based on the customer‘s location. Leased property, including licensed software and digital products, will be taxed based on where the items are used after leaving Tennessee. All marketplace sales (like those through online platforms) will be taxed based on the shipping address of the purchaser.