"If the software is licensed, then the originating company owns it and they can pay the property taxes on it," wrote one reader. "I have to pay property tax on all the computer hardware and software used in my business virtually forever or until I declare it obsolete and no longer used. This is subject to audit by an agent of the county whose audit is accepted by the IRS as valid. If I rent a car as a business expense, the property taxes are paid by the owner, not me, except as incidental through my rental payments. It would serve these software developer thugs right to have to pay property tax on every sale they make to every end user in every state. If they refuse, then the software is automatically recognized as owned by the buyer, not leased."

Several readers also theorized that, if you're not truly buying the software, you shouldn't have to pay sales tax. "If you do not pay sales tax to lease or rent a car, and you do not pay sales or property tax when you lease or rent an apartment or house, but you do pay sales tax when you purchase software, then it really must be sold, not licensed," wrote another reader. "After all, when you license the use of a car or house, you do not pay taxes for that transaction. Companies see software costs as a capital cost. If you don't own it, it cannot be capital."

Readers have previously speculated about depreciation and software. "The idea of depreciation is that if you for example sell a piece of software after using it for two years, it still has some value to somebody, though less value than it did to you when you originally purchased it," one reader wrote. "It's not about making a gain on the sale, but about recovering some of the original purchase price since you didn't completely use it up -- a gain on the sale is in fact treated as a capital gain. The whole notion of applying depreciation to software may be broken since software doesn't "wear out", except in the eyes of software vendors who want us to buy their latest upgrades. But those are the rules we have to play by."

Another persistent issue is how to treat embedded software from hardware vendors like Cisco who say it must be re-licensed if the device is re-sold. "So how do the bean counters handle the depreciation of hardware/software that has almost zero resale the day after purchase, since the software re-license costs more than a new unit?" wondered one reader. "In the dot.com failures, what did it take to purchase all or substantially all of the capital stock of the bankrupt transferor? If the debts exceed the assets, it doesn't seem to take much. I don't know the answer, but it's an interesting problem."

It does seem like software publishers are getting to have their cake and eat it too. "I have managed large software development projects during which we leased computer hardware and development software," wrote one reader. "Some items were purchased. It was part of the lease agreement and monthly payment amount to specify which party, the owner or the lessor, had the rights to declare tax liability. In most cases, the owner claimed that right because it was to their bottom line advantage. Those leased components were expensed as a project cost and were not recognized as capital equipment of the company. The stuff we bought, whether hardware or software, became capital expenses which were depreciated differently, depending on whether it was hardware or software. Those are IRS and GAAP rules and practices."

But that same reader suggests that perhaps there is an easy way to force software companies to play by just one set of rules. "Why are we attempting to fight this so hard?" the reader wrote. "Let the software companies win. Just let them win the entire battle and the war. When the states, counties, and municipalities come raining down on them to squeeze money from their coffers, it will be in sufficient amount to force this back into the courts to be undone by the same stupid judges that created this mess in the first place. This license/ownership issue is totally absurd in that we allow the software suppliers to get away with it."