Are motorized scooters and orthopedic items like a walker boot, post-op soft shoe, and suspension boot exempt from Colorado sales tax?
Plain-English summary
A seller asked whether two groups of products are exempt from Colorado sales tax: (1) motorized scooters (padded chairs on a three- or four-wheel platform, electric-powered, steered by a handlebar, marketed to people who have trouble walking long distances), and (2) orthopedic items — an over-the-counter short-leg walker boot, a post-op soft shoe/slipper, and a suspension boot (a padded boot that relieves heel pressure to prevent or treat pressure sores).
The Department concluded none of them is exempt — so all are taxable:
1. Motorized scooters aren't exempt "wheelchairs." Colorado taxes tangible personal property but exempts wheelchairs (§ 39-26-717(1)(a)). Exemptions are narrowly construed and granted only when a transaction clearly fits (Security Life & Accident Co. v. Heckers). Although the scooters share traits with wheelchairs, they aren't commonly understood to be wheelchairs — even the manufacturers don't call them that — so they don't qualify.
2. The walker boot, soft shoe, and suspension boot aren't "therapeutic devices." Colorado exempts therapeutic devices, appliances, or related accessories sold to correct or treat a human physical disability or surgically created abnormality (§ 39-26-717); exempt devices costing $100 or more must be prescribed by a healing-arts practitioner. But a therapeutic "device" is a piece of equipment or a mechanism, and an "appliance" adapts a tool/machine to a special purpose (FYI Sales 68). Many products have therapeutic effects without being devices — band-aids, padding, support hose, wrist/elbow bands. A boot cradle, heel protector, the soft shoe, and the suspension boot are therapeutic but aren't equipment, so they don't qualify.
What this means for you
Sellers of mobility and medical products
The exemption labels are read strictly. "Helps someone with a disability" is not enough — the wheelchair exemption is for wheelchairs, and the therapeutic-device exemption is for equipment/mechanisms, not soft goods like boots, shoes, padding, or supports. If a product isn't commonly understood to be the exempt item, expect it to be taxable.
Power scooters specifically
Mobility scooters were held not to be exempt wheelchairs here, even though they help people who struggle to walk. Marketing and common understanding (and even how the manufacturer describes the product) matter to the analysis.
The $100 prescription rule
When a product does qualify as a therapeutic device, remember the structure: exempt therapeutic devices costing $100 or more must be prescribed by a healing-arts practitioner. That rule doesn't rescue items that fail the "device = equipment" threshold in the first place.
Common questions
Q: Is a motorized mobility scooter tax-exempt in Colorado?
A: Under this guidance, no. The wheelchair exemption is narrowly construed, and scooters aren't commonly understood to be wheelchairs, so they're taxable.
Q: Are orthopedic boots and post-op shoes exempt as therapeutic devices?
A: No. A therapeutic "device" must be equipment or a mechanism. Boots, soft shoes, padding, support hose, and similar soft goods have therapeutic effects but aren't "devices," so they're taxable.
Q: When does a prescription matter?
A: For items that do qualify as therapeutic devices, those costing $100 or more must be prescribed by a healing-arts practitioner to be exempt.
Q: Can I rely on this letter?
A: No. It's a General Information Letter — the good-faith opinion of Department staff, not binding (§ 24-35-103.5). The Executive Director did not formally review it.
Citations and references
Statutes, cases, and publications:
- § 39-26-104(1)(a), C.R.S. — imposition of sales/use tax on tangible personal property
- § 39-26-717(1)(a), C.R.S. — wheelchair exemption
- § 39-26-717, C.R.S. — therapeutic devices exemption ($100+ requires a practitioner's prescription)
- § 24-35-103.5, C.R.S. — informational letters are not binding
- Security Life & Accident Co. v. Heckers, 177 Colo. 455, 495 P.2d 225 (1972) — exemptions narrowly construed
- Department FYI Sales 68 — therapeutic devices and appliances
Medical-exemption cousins: [[gil-09-009-enteral-feeding-pump]], [[gil-09-022-medical-equipment-sales-tax]], [[plr-10-004-private-letter-ruling-dear]].
Source
- Landing page: Colorado Sales & Use Tax Letter Rulings
- Original PDF: GIL-08-004.pdf
Original ruling text
Office of Tax Policy
P.O. Box 17087
Denver, CO 80217-0087
[email protected]
GIL-2008-4
XXXXXXXXXXX
XXXXXXXXXXX
XXXXXXXXXXX
XXXXXXXXXXX
February 21, 2008
Re: Taxability of motorized scooters, boot walker, and soft shoe
Dear XXXXXXXXX,
This letter is in response to your letters to the Colorado Department of Revenue, dated December 5,
2007, re: taxability of motorized scooters and a variety of orthopedic boots and shoes.
Colorado Department of Revenue provides informational letter as a service to taxpayers. These
letters represent the opinion of knowledgeable and experienced department staff and can be a
valuable resource in making informed decisions regarding your tax obligations. However, these
letters are not binding on the department. §24-35-103.5, C.R.S.
Issues
1. Are the [scooter] and [scooter] exempt from tax?
2. Are the OTC professional orthopaedic premium short-leg walker boot, professional orthopaedic
post-op shoe soft top, and the [name] Suspension Boot exempt from tax?
Background
You provide the following brief descriptions of two groups of products. The first group is comprised of
two types of motorized scooters. These scooters are padded chairs mounted on a platform that has
either three or four wheels. The scooters are powered by an electric motor and steered by a handle
bar mounted to a post. The scooters are designed to carry one person both indoors and outdoors.
The scooters presumably marketed to people who have difficulty walking longer distances.
The second group is comprised of either a short leg boot walker or soft shell shoes. The boot walker
is described as a short leg cast a wraparound sole that absorbs heel strikes, and used to facilitate
walking for a person who has suffered a strain, sprain or fracture. The [name] shoe is a slipper that is
padded in part and reinforced in part to provide comfort for a person who has suffered soft tissue or
trauma to the foot. Both the boot walker and soft shoe are marketed as “OTC,” which I assume
means that they do not require a prescription – i.e., “over the counter.” The [name] suspension boot is
a padded boot that relieves heel pressure by an elevated soft foam heel pad within the boot. It is
used to prevent or treat pressure sores.
Discussion
1. Motorized scooters are not exempt.
Colorado imposes a sales and use tax on the sale, use, storage or consumption of tangible personal
property (§39-26-104(1)(a), C.R.S.). However, wheelchairs are exempt. §39-26-717(1)(a), C.R.S.
The issue in this case is whether the scooters qualify as a wheelchair.
Exemptions from taxation are narrowly construed and will not be granted unless the transaction
clearly falls within the exemption. Security Life & Accident Co. v. Heckers, 177 Colo. 455, 495 P.2d
225, 226 (1972). Although the scooters have characteristics of a wheelchair, they do not appear to
be what is commonly understood to be a wheelchair. Indeed, the manufacturers themselves do not
refer to them as wheelchairs. Therefore, I do not believe these scooters are exempt.
2. Boot walker, soft shoe and [name suspension boot] are not therapeutic devices.
Colorado exempts the sale of therapeutic devices, appliances, or related accessories that are sold to
correct or treat a human physical disability or surgically created abnormality. §39-26-717, C.R.S.
Exempt therapeutic devices that cost $100 or more must be prescribed by a healing arts practitioner.
However, and as noted above, this exemption, like all other exemptions, is narrowly construed.
There are a variety of products that have therapeutic effects but do not qualify as an exempt
therapeutic device. Band-aids, padding, support hose, and wrist or elbow bands, are examples of
items that assist in the process of healing or treatment of a disability but are not commonly
understood to be therapeutic devices.
A therapeutic “device” is defined as a piece of equipment or a mechanism designed to serve the
special purpose of correcting or treating a human physical disability or surgically-created abnormality.
An “appliance” is defined as a piece of equipment for adapting a tool or machine to a special purpose.
See, Department FYI Sales 68, page 2. A boot cradle, such as the short-leg walker boot, or heel
protector are examples of items that are therapeutic but do not qualify as therapeutic devices
because they are not equipment. For this same reason, the soft shoe and [name suspension boot]
do not qualify as therapeutic devices.
Finally, the Department makes a good faith effort to provide accurate and complete answers to
questions posed to it by taxpayers. However, the information and answers provided here are not
binding on the Colorado Department of Revenue, nor do they replace, alter, or supersede Colorado
law and regulations. The Executive Director, who by statute is the only person having authority to
bind the Department, has not formally reviewed and/or approved this response.
Respectfully,
Office of Tax Policy
Colorado Department of Revenue