Was a contractor's full charge taxable when its work changed a customer's DMV classification from a commercial truck to a house car?

Plain-English summary

The memorandum addressed work on a customer's vehicle that was extensive enough to change its DMV classification from a truck and commercial vehicle to a house car.

That change made the transaction a modification of the vehicle. Tax applied to the contractor's total charge attributable to the modification, with no deduction for amounts labeled installation labor.

Citations and references

• California Motor Vehicle Code sections 260, 362, and 410 (as cited under historical numbering)

Source

• Annotated Legal Opinions collection: https://cdtfa.ca.gov/taxes-and-fees/annotations-menu.htm
• Annotation page: https://cdtfa.ca.gov/lawguides/vol2/suta/435-0000-all.html
• Original supporting opinion: https://cdtfa.ca.gov/lawguides/annotations/435-0464.pdf

Original ruling text

State of California

Board of Equalization

Memorandum

To:

Inglewood – Auditing (JKI)

From:

Tax Counsel (GJJ) - Headquarters

435.0464

Date:

April 21, 1976

We agree with the analysis made in your memorandum of April 8, 1976, that when taxpayer’s contract for work is of such magnitude that the DMV classification code changes from that of a truck and commercial vehicle (DMV Code 410 and 260, respectively) to a house car (DMV Code 362), the sale results in a “modification” of the customer’s vehicle and taxpayer’s total charge attributable to such modification is, accordingly, subject to the tax, with no deduction allowable for “installation labor.”

j:alicetilton