It's pretty settled precedent that leasing or owning tangible property in a state or county creates a tax nexus. But what form those taxes take—and the tax rat

It's pretty settled precedent that leasing or owning tangible property in a state or county creates a tax nexus. But what form those taxes take—and the tax rate and available credits—does vary. Expect to pay property taxes (usually annually) on the value of the equipment in all but 11 states[0]. Independent of property tax, most also expect you to either pay sales tax when you buy the equipment in-state, or pay use tax when you bring it into the state (possibly with a credit for sales tax already paid elsewhere). Some states have passed exemptions specifically for data center equipment, e.g. Pennsylvania[1]. If your home state is one of ~23 that's a member of "streamlined sales tax"[2], you don't have to fill out a separate sales tax return for each member state in which you have a nexus. (But thanks to South Dakota v. Wayfair[3], you may be required to collect sales tax in other states anyways, regardless of the nexus created by your data center presence.) [0]: See Table 1 here for a list: https://taxfoundation.org/research/all/state/states-moving-away-taxes-tangible-personal-property/ https://taxfoundation.org/research/all/state/states-moving-a... [1]: https://www.revenue.pa.gov/IncentivesCreditsPrograms/ComputerDataCenterEquipProg/Pages/default.aspx https://www.revenue.pa.gov/IncentivesCreditsPrograms/Compute... [2]: https://www.streamlinedsalestax.org/ https://www.streamlinedsalestax.org/ [3]: https://en.wikipedia.org/wiki/South_Dakota_v._Wayfair%2C_Inc%2E https://en.wikipedia.org/wiki/South_Dakota_v._Wayfair%2C_Inc...