Were leased parking gates and door locks fixtures treated as tangible personal property when the equipment lessor retained removal rights?

Plain-English summary

West Los Angeles Audit asked about parking gates/door locks. Headquarters Legal concluded they were fixtures but section 6016.3 treated them tangible personal property when leased with lessor removal right and equipment lessor was not also realty lessor. Request, lease and underlying records absent.

Accordingly rent was taxable unless items were leased substantially same form as acquired tax-paid. Source supplies no acquisition/tax or physical-removal evidence.

Memo addressed earlier case where Board found gates not personal property. Reason was not entirely clear; it appeared influenced by hardship and testimony removal right had no value. Legal thought conclusion intended limited to that case. Prior decision/testimony absent.

Live 330.2570 publishes section 6016.3/rent result but omits uncertain prior-case discussion and missing proof.

Common questions

Did attachment to realty automatically remove gates/locks from lease tax?

No. The cited statute kept the described fixtures within tangible personal property treatment.

Which facts supported that treatment?

The equipment lessor had a right of removal and was not also the lessor of the underlying realty.

When was tax due on rent?

When the leased items did not qualify as tax-paid property leased in substantially the same form as acquired.

Did memorandum adopt earlier case's contrary conclusion?

No. It confined that conclusion to the earlier case's hardship and evidence that its removal right lacked value.

Was earlier case reasoning certain?

No. Memo expressly says reason was not entirely clear and only appeared influenced by hardship/testimony.

Were removal rights and value documented?

No lease or physical/economic evidence appears in published source.

May another fixture lessor rely on this result?

No. It is internal historical advice on missing facts and an unidentified prior case; current fixture and lease law must be checked.

Citations and references

• Section 6016.3 — fixture as tangible property under removal/realty-lessor facts
• June 28 audit memo and lease/fixture/removal/realty/acquisition/rent evidence — absent
• Earlier unidentified parking-gate case/record — uncertain reasoning, limited to facts
• Official Annotation 330.2570 — result without earlier-case/evidence limits

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: Annotation 330.2570
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/330-2570.pdf

Original ruling text

State of California

Board of Equalization

Memorandum

To:

West Los Angeles – Auditing (JD)

From:

Headquarters – Legal (TPP)

Subject:

G--- H--- Inc.
C--- K--- Division

330.2570

Date:

September 16, 1977

SY -- XX-XXXXXX

In response to your memorandum of June 28, we have concluded that the parking gates and door locks in question are fixtures which, under Section 6016.3, are to be treated as tangible personal property when leased with the right of removal by the lessor, where the lessor is not also the lessor of the realty to which the items are affixed. Accordingly, tax is due on the lease receipts when the items are not leased in substantially the same form as acquired tax-paid. The reason why the Board concluded the parking gates were not personal property in the earlier case is not entirely clear, but the conclusion appears to have been influenced by the hardship in the particular case and by certain testimony that the right of removal in that particular case was of no value. Under the circumstances, we think the conclusion was intended to be limited to that particular case.

TPP:po

cc:

R. Nunes
D. F. Brady
W. E. Burkett
J. H. Murray
G. L. Rigby