Which urinary-incontinence devices and related supplies did California treat as exempt medicines?

Plain-English summary

California concluded that a urinary-incontinence system qualified as an exempt prosthetic device when it consisted of a catheter—indwelling, intermittent, external, or suction—and a collection bag, plus the connectors and caps needed to complete the fluid path, and was designed to be fully worn on or in the user's body. The memorandum reasoned that the device assisted the functioning of the bladder.

It also exempted prescribed topical antiseptic solutions, adhesives used to hold the device in place, adhesive removers, and insertion lubricants when sold for use with an exempt device. Cleaners and decontamination equipment, insertion kits, and irrigation syringes remained taxable.

Common questions

Was every urinary-incontinence product exempt?

No. The exemption depended on the device's components, function, and being fully worn on or in the user's body.

Which related consumables qualified?

The memorandum identified topical antiseptics, adhesives, adhesive removers, and lubricants sold under a physician's prescription for use with the exempt device.

Which related products remained taxable?

Cleaning and decontamination equipment, insertion kits, and irrigation syringes.

Did the memorandum preserve an earlier contrary staff position?

No. It described that earlier position, then said further review led to the conclusion that qualifying catheter-and-bag systems were exempt prosthetic devices.

Citations and references

• California Sales and Use Tax Regulation 1591(b)(5) — prosthetic-device rule applied to the catheter-and-bag system
• California Sales and Use Tax Regulation 1591 — medicine rule applied to prescribed supplies used with an exempt device

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/425-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/425-0906.pdf

Original ruling text

State of California

Board of Equalization
Legal Division (MIC:82)

Memorandum
425.0906

To:

Oakland - Auditing

From:

Charles J. Graziano

Subject:

S--- B--- Health Center Inc.
SR -- XX XXXXXX C/O

Date:

January 4, 1985

This is in reply to your memo dated October 3, 19XX, wherein you request we resolve an inconsistency with regard to the staff’s application of tax to the sale of “urinary incontenent supplies,” i.e., devices which are used to collect urine from patients in the nonsurgical treatment of urinary incontinence. In my letter dated October 4, 19XX to Ms. J--- T--- of the C--- P--- Association, I stated that urinary incontinence supplies do not qualify as exempt medicines under Sales and Use Tax Regulation 1591(b)(5) as prosthetic devices, nor do they qualify under 1591(j) as exempt ostomy appliances. However, as you point out, the Board has previously decided in the -.-.-.-. Inc. petition for redetermination (SY – XX-XXXXXX, Hearing Officer Robert H. Anderson, 3-2XX) that urinary incontinence supplies which consist of catheters and drainage bags are exempt from taxation as prosthetic devices under Regulation 1591(b)(5). We have further reviewed the use of these devices and now conclude that such urinary incontinence devices do qualify as exempt prosthetic devices under Regulation 1591(b)(5), provided such items are fully worn in or on the body of the user. In our view, a urinary incontinence device which is comprised of a catheter (indwelling, intermittent, external, or suction), and a collection bag, together with any connectors and caps which are necessary to complete the fluid track, and is designed to be fully worn on or in the body of the user is a nontaxable prosthetic device under Regulation 1591(b)(5) for the reason that such a device assists in the functioning of the user’s bladder. In addition, it is our opinion that such items as topical antiseptic solutions, adhesives (used to hold the device in place), adhesive removers (used to remove the adhesive), and lubricants (used to insert the urinary device), qualify as tax exempt medicines under Regulation 1591 when sold under a physician’s prescription for use with an exempt urinary incontinence device. In our view, however, the following items do not qualify as

Mr. William G. Matusich

-2-

January 4, 1985
425.0906

exempt prosthetic devices or otherwise qualify as exempt medicines under Regulation 1591, even though such items are used with exempt urinary incontinence devices: cleaners and equipment which are used to remove contaminants from the urinary incontinence device; insertion kits which are used to insert the catheter; and irrigation syringes, which are used to clean the catheter.

CJG:ba
cc:

Mr. G. J. Jugum
Mr. D. J. Hennessy