How was a larger-screen television conversion taxed for a customer-owned used set and for a new set sold by the converter?

Short answer For a customer-owned set, separately stated installation labor was excluded and parts were taxable. Converting a new set as part of its sale made the full charge taxable.

State

Ruling

Annotation 435.1680

Tax type

Sales and Use Tax

Issued

1950-01-12

Issued by

California State Board of Equalization

Requested by

A business asking about converting customer-owned and newly sold television sets to larger screens

Topics

television sets used property new property parts installation labor services part of sale

Source

View Original PDF

Apply this to your situation

This page answers the general question as of 1950. Ask about yours and see what current California tax law says, with citations.

Disclaimer: This is a California State Board of Equalization associate-tax-counsel letter dated January 12, 1950, published by CDTFA as support for a sales and use tax annotation. It distinguishes conversion of a customer-owned set from a larger-screen conversion provided as part of selling a new set and depends on separate statement of installation labor. Another taxpayer should not treat it as binding and should check current electronics, television, conversion, parts, repair, installation, billing, and sales-and-use-tax rules. This summary is informational only and is not legal or tax advice.

About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page as a PDF) is the authoritative source for any reliance.

View original ruling (PDF)

Plain-English summary

For conversion of a customer-owned television to a larger screen, the converter was the retailer of parts and materials. If installation labor was separately stated, tax applied only to the retail selling price of those parts and materials.

If the converter sold a new television and provided the larger-screen conversion as part of that sale, the full charge for the converted set was taxable.

Citations and references

California Sales and Use Tax Ruling 26 (discussed as not specifically pertinent to this conversion)

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/435-1680.pdf

Original ruling text

435.1680

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

January 12, 1950

S--- and R--XXX --- --- Street
--- --- XX, California

Gentlemen:
This is in answer to your letter for December 27 with respect to the application of State sales tax to a charge by your client for converting a television set owned by a customer to a larger screen size. It is our opinion that your client is the retailer of the parts and materials furnished in connection with the conversion of the customer’s television set to a larger screen size. Accordingly, if the charge for the labor of installing such parts and materials are separately stated, the tax will apply only to the retail selling price of such parts and materials. Paragraphs 2 and 3 of Sales and Use Tax Ruling 26, referred to in your letter, refer to specific types of repair operations and do not appear to be pertinent to the operations herein involved. If the conversion is to a new television set sold by your client and is a service rendered as a part of the sale of such set, the tax will apply to your client’s full charge for the converted set. Very truly yours,

R. G. Hamlin
Associate Tax Counsel

RGH:HB
Enclosures
cc:

Mr. Wm. R. Thomson

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