Did shipping cremated remains out of California exempt the casket and other property consumed in the cremation?

Plain-English summary

The casket and other tangible property cremated with the body were used and consumed in California. Shipping the resulting remains out of state did not turn those consumed items into property sold in an exempt interstate shipment.

The mortician could take an interstate-commerce deduction for the portion of the total tangible-property selling price attributable to the urn or other receptacle used to ship the remains to the out-of-state destination.

Source and live-annotation limits

The memorandum does not reproduce Jack Najarian's January 18, 1972 memorandum or identify the mortician, decedent, customer, or destination. It supplies no body, casket or other property, urn or receptacle, contract, cremation, shipment, total selling price, allocation, invoice, tax return, audit, assessment, completed transaction, or later outcome. The author appears only as the initials “GLR.”

The live annotation preserves the California-consumption and no-interstate-shipment result for the cremated casket and other property. It omits the named internal recipient, January 18 memorandum, Regulation 1505, urn-or-receptacle interstate deduction, allocation requirement, missing records, unidentified author, and later-outcome gap.

What this means for you

Morticians, funeral homes, and tax professionals

Document where cremation occurs, every item consumed with the body, the outbound container, delivery destination and method, contract terms, separately supported selling-price allocation, and tax reporting. Shipment of remains did not carry already consumed property into interstate commerce.

Common questions

Did the casket travel in interstate commerce after cremation?

No. The memorandum treated it as consumed in California during cremation.

Was any part of the property charge deductible?

Yes. The portion for the urn or other outbound shipping receptacle could qualify.

What rule governed the remaining taxable property?

The memorandum applied Regulation 1505 to the funeral property consumed in California.

Citations and references

• California Code of Regulations, title 18, section 1505 — mortician and funeral-property tax treatment applied
• January 18, 1972 memorandum, mortician contract, cremated property, shipment, selling price, and urn or receptacle charge — described or referenced but not included

Verbatim support

From the official January 27, 1972 memorandum:

We are of the opinion that the casket and other tangible personal property are consumed in this State through cremation and do not become the subject of an interstate shipment.

A deduction may be taken as a sale in interstate commerce of that portion of the selling price of all the tangible personal property furnished that represents the charge made for the urn or other receptacle in which the mortician ships the remains to a point outside this State.

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/370-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/370-0050.pdf

Original ruling text

370.0050

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

January 27, 1972

Mr. Jack Najarian
Regulation 1505 – Interstate Shipment of Tangible Personal Property in a Cremated State Please refer to your memorandum of January 18, 1972. With respect to the application of tax in the case of cremation in this State, the remains (including the casket and other tangible personal property) being shipped outside this State by the mortician pursuant to the contract of sale, we are of the opinion that the casket and other tangible personal property are consumed in this State through cremation and do not become the subject of an interstate shipment. Accordingly, in the case of cremation in this State, the tax applies as indicated in Regulation 1505 with the exception that a deduction may be taken as a sale in interstate commerce of that portion of the selling price of all the tangible personal property furnished that represents the charge made for the urn or other receptacle in which the mortician ships the remains to a point outside this State.

GLR: lb