The Indiana Department of Revenue concluded that a company’s employment screening and background checking services are not subject to sales tax. The company in this matter receives requests from customers seeking to verify the background, employment history or education of a potential employee or tenant. The company then compiles information from various government databases, courthouse records and educational institutions to create a customized report for the customer. The customer may only view the custom report by accessing the company’s secure website. Indiana does not tax electronically delivered items unless the item constitutes a taxable digital product, prewritten software or a telecommunications service. The Department determined that the company’s custom reports are not similar to digital songs, movies/TV shows or books and therefore are not taxable as a digital product.

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