Are coaching services taxable in NJ?

NJ is expected to expand sales tax to coaching services with digital components in 2026. Pure consulting may remain exempt, but coaching with workbooks, portals, or digital deliverables is likely taxable.

Is SaaS taxable in the Tri-State area?

Yes. SaaS is taxable in NY and CT. NJ taxes many SaaS products as information services. Always verify your specific product category.

How do I avoid over-taxation on bundled services?

Unbundle your invoices. Separate strategy calls (often non-taxable) from deliverables (taxable). Bundled invoices get fully taxed; unbundled invoices can save thousands.

NY, NJ & CT 2026 Sales Tax Expansion: What Service Providers Must Know

Gregory Monaco, CPA
Jan 1
2 min read

NY, NJ & CT 2026 Sales Tax Expansion blog post header with Monaco CPA branding in navy blue and gold, explaining what service providers must know about digital services taxation — The Tri-State is entering a new era of sales tax enforcement in 2026. Coaches, agencies, SaaS founders, and digital creators face major compliance shifts as NY, NJ, and CT expand taxation on digital services.

Last Updated: January 1, 2026

Quick Summary

TL;DR: The Tri-State is entering a new era of sales tax enforcement. NY already taxes nearly every digital deliverable. CT taxes SaaS and digital goods. And NJ—historically the most lenient—is expected to expand sales tax to digital products, coaching, and many hybrid service models in 2026. Agencies, coaches, consultants, creators, and therapists are about to be hit with the biggest compliance shift in a decade.

The Big 2026 Shifts (Plain English)

Digital goods → taxable across NY & CT; expected in NJ
Coaching with worksheets or portals → taxable
SaaS → always taxable in NY & CT
Hybrid invoices → fully taxable unless unbundled
Creators selling templates → taxable
Agencies providing reports or dashboards → taxable
Web design, maintenance, digital development → taxable in NY & CT

State-by-State Breakdown

New York (Most Aggressive)

Taxable services include:

SaaS and cloud-based software
Information services
Digital downloads
Marketing/data analytics
Social media management
Many creative services
Web dev/maintenance

Connecticut

Taxable services include:

SaaS
Digital goods
Website hosting/data processing
Some IT services

New Jersey (Expected Expansion in 2026)

Currently taxable:

Digital products
Information services
SaaS (in many cases)

Likely to expand to:

Coaching
Digital programs
Hybrid service packages

Pro Tip: Invoice Engineering

To avoid over-taxation, structure your invoices properly:

Separate strategy calls (non-taxable in NY) from deliverables (taxable)
Break out deliverables by type
Identify location-based sourcing
Maintain a product/service SKU structure

Critical: Bundled invoices get fully taxed. Unbundled invoices save thousands.

Who's Most Affected?

Marketing agencies
Coaches and consultants
Therapists offering digital workbooks
Course creators
SaaS founders
Content creators with paid downloads
Designers selling templates

Agencies in Newark, Jersey City, Montclair, Hoboken, Brooklyn, and Manhattan will feel the pressure first.

Schedule a consultation to review your sales tax exposure.

Gregory Monaco is a CPA serving service providers throughout New Jersey and the Tri-State area from Livingston, NJ.