Was a glamour-photography company's retained sitting fee nontaxable when the package included makeup, hairstyling, and one sample photograph?

Plain-English summary

In a January 23 letter, a business called itself primarily a glamour-photography company. It hired independent-contractor photographers and makeup artists, sent them to beauty salons, and said salon employees arranged appointments and styled hair. It described contracts giving the company $9.95 of each salon's $29.95 patron charge, called that amount a sitting fee, said most income came from photo sales, and said patrons had no obligation to buy more photographs.

After staff sent Pamphlet 68's rule taxing sitting fees when a customer receives pictures or proofs, the business changed emphasis in a February 28 letter. It called the sitting fee payment for makeup and hairstyling, described a free promotional sample photograph costing about $1.25, said its share ranged from $9.95 to $19.95 with little profit because of makeover costs, and claimed many patrons sought only an inexpensive makeover.

Senior Tax Counsel identified conflicts: the first letter fixed the company share at $9.95 and said the company hired only photographers and makeup artists, while the second used a $9.95-$19.95 range and included hairstyling cost even though the salon performed that work. The answer therefore assumed the salon charged $29.95 for hairstyling, makeup and one photograph; the company supplied the makeup artist and photographer and received $9.95; and the photo promoted later sales.

On those assumptions, the source found the makeover incidental to the photography transaction. It relied on the glamour-photography logo, the admission that most income came from photograph sales, the sample's promotional purpose, and the customer's receipt of a finished picture.

Sales tax therefore applied to all of the company's charges when the customer received the sample. Regulation 1528(a) also denied deductions for photograph-production expenses even if itemized. The letter contrasted Pamphlet 68's nontaxable rule when a customer receives no finished picture or proof.

Cross-reference and source posture

The letter says its conclusion is supported by BTLG Annotation 440.0310 (4/24/57). A direct fetch of the exact live 440.0310 URL returned HTTP 404. Live Annotation 420.0300 bears the exact April 24, 1957 date and addresses sitting fees with pictures, no pictures and retained proofs. This page records that date-and-subject match but does not silently rewrite the official letter's printed 440.0310 citation.

The source supplies neither January nor February inquiry, the April 29 referral, company or salon identity, contracts, logo, appointment records, hairstyling or makeup records, photograph, $1.25 cost proof, $9.95 or $19.95 receipt, income breakdown, invoice, return, audit, assessment or later outcome. It also does not establish whether every actual package matched the seven assumed facts. Regulation 1528 was enclosed but is absent from CDTFA's three-page PDF; Pamphlet 68 is quoted but not reproduced.

The live 420.0303 annotation, in the 2026 revision of the Business Taxes Law Guide, retains the $29.95 package, company makeup artist and photographer, sample photo, $9.95 share, glamour-photo logo, photo-sales income, incidental-makeover finding and June 18, 1997 date. It presents the assumed transaction as facts and omits the conflicting two letters, $9.95-$19.95 range, $1.25 sample cost, salons' hairstyling role, no-purchase obligation, patrons allegedly seeking only makeovers, Pamphlet 68, no-expense-deduction rule, defective cross-reference, missing enclosure and absent applied outcome.

CDTFA's Annotated Legal Opinions collection says the letters are summarized as annotations and that statutory law controls whenever a statute and annotation conflict. The official three-page PDF has a clean native text layer and one small page-1 letterhead stencil rather than scanned text, so no OCR was required. Both fresh direct PDF downloads and both live-page downloads were byte-identical, duplicate default PDF text extractions matched, and the original-text section remains byte-identical to its committed version and fresh extraction after removal of only the extractor's terminal newline and form feed.

What this means for you

Photography and makeover businesses

Align marketing, contracts, staffing, revenue and invoices with the claimed true object. A free sample can still support a taxable photography transaction when it is part of the package and promotes photo sales. If facts vary by salon or package, document them rather than relying on assumptions drawn from conflicting descriptions.

Common questions

Q: Why was the retained charge taxable?

A: On the assumed facts, the makeover was incidental and the customer received a promotional finished photograph from a glamour-photography business.

Q: Did the customer have to buy more photographs?

A: No under the first letter, but the included sample photograph still supported taxation of the company's retained charge.

Q: Was the company share definitely $9.95?

A: The answer assumed $9.95, while the second letter described a $9.95-$19.95 range. No contract or invoice resolves the conflict.

Q: Who performed hairstyling?

A: The assumed facts say salon employees did; the company supplied the makeup artist and photographer.

Q: Is printed Annotation 440.0310 available at its exact live URL?

A: No; that URL returned 404. Annotation 420.0300 has the cited April 24, 1957 date and matching subject, but the official source itself prints 440.0310.

Citations and references

• California Revenue and Taxation Code sections 6006(a), 6051, 6201 and 6401 — cited for transfer, sales-tax and use-tax rules
• California Sales and Use Tax Regulation 1528(a) — cited for photograph sales and no production-expense deduction; described as enclosed but not reproduced
• Pamphlet 68, page 1 — quoted for sitting fees with and without delivered pictures or proofs, but not reproduced
• Printed BTLG Annotation 440.0310 (4/24/57) — exact live URL returned 404; Annotation 420.0300 has the date and sitting-fee subject
• Inquiry letters, referral, contracts, logo, service and photo records, costs, income, invoices, returns, audits, assessments and outcomes — described or implicated but not included

Verbatim support

From the official June 18, 1997 Senior Tax Counsel letter:

In your two letters you have provided conflicting information.

Based on the information contained in both letters, we assume the following facts:

The purpose of this promotion is to entice patrons to purchase photographs.

Thus, it is our conclusion that the makeover is incidental to the “sitting fees and the sale of the photographs.

Thus, in accordance with Regulation 1528(a) sales tax applies to all of C---’s charges when the customer receives a finished proof or picture.

Source

• Annotated Legal Opinions collection: CDTFA Annotated Legal Opinions
• Live annotation: Annotation 420.0303
• Original supporting opinion: 420.0303 PDF
• Date-and-subject-matched live authority: Annotation 420.0300

Original ruling text

420.0303

STATE OF CALIFORNIA

JOHAN KLEHS
First District, Hayward

STATE BOARD OF EQUALIZATION
LEGAL DIVISION (MIC:82)
450 N STREET, SACRAMENTO, CALIFORNIA
(PO BOX 942879, SACRAMENTO, CALIFORNIA 94279-0082)
TELEPHONE (916) 327-2291
FAX (916) 323-3387

DEAN F. ANDAL
Second District, Stockton
ERNEST J. DRONENBURG, JR.
Third District, San Diego
KATHLEEN CONNELL
Controller, Sacramento
___

June 18, 1997

JOHN CHIANG
Acting Member
Fourth District, Los Angeles
___
E. L. SORENSEN, JR.
Executive Director

Ms. L--- A--C--- I--- G--- P--XXXX --- Ct., Suite #XXX
--- ---, CA XXXXX
Re:

Taxability of Photographic Sitting Fees
SR -- XX-XXXXXX

Dear Ms. A---:
This is in response to your letters of January 23, 1997 and February 28, 1997 in which you question whether charges for photography “sitting fees” are subject to sales tax. These letters were forwarded to the Legal Division for reply on April 29, 1997. In your letter of January 23, 1997 you state that your company, C--- I---, is primarily a glamour photography business. You explain : “We hire independent contractor photographers and make-up artists and send them to beauty salons. The beauty salons set up appointments with their patrons and do the hair styling. Our make-up artists also give the patrons makeovers before our photographers take their pictures. The beauty salons contract with us provide that we get $9.95 of the $29.95 that the salon charge their patrons. That
$9.95 is our sitting fee.”
You further explain that:
“Like almost all photography studios most of our income is from selling photographs. However, the salon patrons are under no obligation to buy anything. Of course we collect and pay sales tax when we do sell photographs.” In response to your January 23, 1997 letter, staff sent you a copy of Pamphlet 68 entitled, “Tax Tips for Photographers, Photo Finishers & Film Processing Laboratories,” which explains, at page one, that sales tax applies to “sitting fees when finished pictures or proofs are received by the customer.” This pamphlet, also at page one, further explains that sales tax does not apply to “sitting fees, when no tangible personal property, such as finished pictures or proofs, are received by the customer.”

Ms. L--- A---

-2-

June 18, 1997
420.0303

In your letter of February 28, 1997 you state that it is your belief that charges for “sitting fees” do not constitute payment for taxable goods or that pamphlet 68 addresses your situation. In this letter you explain that: “The sitting fee is actually a payment for makeup and hairstyling, not for photographs. While we do give away a free sample photograph in order to entice patrons to purchase photographs, the cost of the photograph is negligible, about
$1.25. In contrast the cost of the makeup and hairstyling is such that we make only a small profit on our $9.95 to $19.95 portion of the sitting fees. Many of our patrons use our service without any intention of purchasing photographs since
$9.95 is very inexpensive for a makeover.”
In your two letters you have provided conflicting information. For example, in the January 23, 1997 letter you specifically state that “the beauty salons’ contracts with us provide that we get $9.95 of the $29.95 that the salon charges each of their patrons.” You further state that you hire only the photographers and the makeup artists. Yet in your letter of February 28, 1997, you state that “the makeup fee is actually a charge for makeup and hairstyling, not for photographs” and that “the cost of makeup and hairstyling is such that we make only a small profit on our $9.95 to $19.95 portion of the sitting fees.” Based on the information contained in both letters, we assume the following facts:
•

C--- hires photographers and make up artists.

•

C--- contracts with beauty salons which charge $29.95 for a make over which includes, hairstyling, makeup, and one photograph.

•

The purpose of this promotion is to entice patrons to purchase photographs.

•

C--- receives $9.95 of the $29.95 charged by the beauty salon.

•

The hairstyling is performed by employees of the beauty salon.

•

The make up is applied by the makeup artist hired by C---.

•

The photograph is taken by the photographer hired by C---.

California imposes a sales tax on a retailer’s gross receipts from the retail sale of tangible personal property in this state unless the sale is specifically exempt from taxation by statute. (Rev. & Tax. Code § 6051.) A sale includes any transfer of title or possession, in any manner or

Ms. L--- A---

-3-

June 18, 1997
420.0303

by any means whatsoever, of tangible personal property for a consideration (Rev. & Tax. Code § 6006(a).) When sales tax does not apply, use tax applies to the use of property purchased from a retailer for use in California, unless the use is specifically exempt from tax. (Rev. & Tax. Code §§ 6201, 6401.) Sales of services are not taxable, since they are not sales of tangible personal property. The basic distinction in determining whether a particular transaction involves a sale of tangible personal property or a service is one of the true object of the contract. It appears to be your contention that you are a makeover service and that the “free sample photograph” given to the client is merely incidental to the services performed. Thus, you conclude that sales tax should not apply under circumstances where the client only receives the “free sample photograph” and does not purchase additional photographs or enlargements of the “free sample photograph.” This contention is inconsistent with both your business logo which describes your business as “C--- I--- G--- P---,” and your statement, in your letter of January 23, 1997, that: “Like most photography studios, most of our income is from selling photographs.” Thus, it is our conclusion that the makeover is incidental to the “sitting fees and the sale of the photographs. Subdivision (a) of Regulation 1528 (copy enclosed), entitled Photographers, Photostat Producers, Photo Finishers and X-Ray Laboratories, states the general rule that sales tax applies to sales of photographs. As previously explained, Publication 68 states that sales tax applies to sitting fees when the customer receives finished proofs or pictures. This conclusion is supported by BTLG Annotation 440.0310 (4/24/57). Regulation 1528(a) further provides that that there are no allowable deductions on account of expenses associated with producing the photographs even if the charges are itemized in the billings to customers. Thus, in accordance with Regulation 1528(a) sales tax applies to all of C---’s charges when the customer receives a finished proof or picture. If you have any further questions, please feel free to contact this office again. Sincerely,

Patricia Hart Jorgensen
Senior Tax Counsel
PHJ:cl
Enclosure (Regulation 1528)
cc:

San Diego District Administrator
Ms. Monique Everson, Tax Representative - Return Analysis Section (MIC:35)