Which listed medical products were taxable or exempt under Florida's 1992 medical-supply rules?

Plain-English summary

The Department classified four items as taxable, two as exempt under stated conditions, and one as unresolved.

Heel protectors, cast boots, bunny boots, and post-op shoes were taxable medical supplies. They could be purchased exempt when dispensed under an individual prescription from an authorized prescriber, bought for resale with a proper resale certificate, or sold to an exempt entity that supplied an exemption certificate.

Ligaclips were exempt because a licensed healing-arts practitioner temporarily or permanently incorporated them into a patient to close blood vessels.

Orthopedic shoes were exempt only when made to specifications prescribed by a podiatrist, orthopedist, or other physician to treat or prevent illness or disease or correct physical incapacity. The quoted rule distinguished those shoes from made-to-order shoes addressing only fitting problems.

The Department declined to issue a binding conclusion for the stomach Levin tube because the distributor did not provide a brochure. It said the tube appeared exempt if temporarily incorporated into a patient by a licensed practitioner.

What this means for you

Medical-supply distributors

An item's connection to treatment did not itself make it exempt. The ruling required a specific exemption, qualifying prescription, resale certificate, or exempt-purchaser certificate.

Orthopedic footwear sellers

The medical purpose and prescriber's specifications mattered. A special fit for comfort alone remained taxable under the quoted rule.

Incomplete product submissions

The Department would not give a binding product ruling without enough descriptive material.

Common questions

Were heel protectors and the three listed boots or shoes taxable? Yes, unless a qualifying prescription or purchaser exemption applied.

Were ligaclips exempt? Yes, as products incorporated into a patient by a licensed practitioner.

Were all orthopedic shoes exempt? No. The ruling required qualifying medical specifications from an authorized physician.

Was the stomach Levin tube definitively exempt? No. The Department declined a binding answer, though it said the item appeared exempt on the limited description.

Citations and references

• Section 212.08(2)(a), Florida Statutes — medical-product exemptions.
• Rule 12A-1.020(6)(a), Florida Administrative Code — medical products incorporated into a patient or dispensed under qualifying orders.
• Rule 12A-1.020(18), Florida Administrative Code — orthopedic and corrective shoes.
• Rule 12A-1.038(1), Florida Administrative Code — resale and exemption certificates.

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 92A-014

Original ruling text

Feb 24, 1992

RE: TAA 92A-014
Medical Products
Section 212.08(2)(a), F.S.
Rules 12A-1.020(6)(a) & (18), 12A-1.038(1), F.A.C.

Dear :

This is in response to your letter of December 13, 1991, in which you requested the issuance of a technical assistance advisement on the taxability of various medical products listed therein:

Your letter provides:

"We are a distributor of medical supplies. The following items are not specifically addressed in the sales tax laws and therefore, we would appreciate a ruling in regard to the sales tax status of each:

"1. Heal (sic) Protector - See enclosed description "2. Cast Boots - See enclosed description "3. Bunny Boots - See enclosed description "4. Post-op Shoe - See enclosed description "5. Stomach Levin Tube - Tube inserted in the stomach feeding purposes. "6. Ligaclips - Item inserted in the body and put on blood vessels to close them off. Acts as a blood vessel staple. "7. Orthopedic Shoes

"The tax status of these items could be involved in a return of ours. We make this statement based on the fact that we have filed refund claims in the past for our customers involving some of the items listed and the refunds were granted. We do no have any open refunds.

"None of the statements in 12-11.002(3)(a), (b), (c), (d) or (e) pertain to us."

APPLICABLE AUTHORITY

Section 212.08(2)(a), F.S., provides in part:

"(2) EXEMPTIONS; MEDICAL."(a) There shall be exempt from the tax imposed by this chapter any product, supply, or medicine dispensed in a retail establishment by a pharmacist licensed by the state, according to an individual prescription or prescriptions written by a prescriber authorized by law to prescribe medicinal drugs; hypodermic needles; hypodermic syringes; chemical compounds and test kits used for the diagnosis or treatment of human disease, illness, or injury; and common household remedies recommended and generally sold for internal or external use in the cure, mitigation, treatment, or prevention of illness or disease in human beings, but not including cosmetics or toilet articles, notwithstanding the presence of medicinal ingredients therein, according to a list prescribed and approved by the Department of Health and Rehabilitative Services, which list shall be certified to the Department of Revenue from time to time and included in the rules promulgated by the Department of Revenue. There shall also be exempt from the tax imposed by this chapter artificial eyes and limbs; orthopedic shoes; prescription eyeglasses and items incidental thereto or which become a part thereof; dentures; hearing aids; crutches; prosthetic and orthopedic appliances; and funerals....

Rule 12A-1.020(6), F.A.C., provides:

"(6)(a) medical products and supplies used in the cure, mitigation, alleviation, prevention or treatment of injury, illness, disease or incapacity are taxable, unless: "1. Temporarily or permanently incorporated into a patient or client by a practitioner of the healing arts licensed by the State of Florida. "2. Ordered and dispensed by or on the prescription of a

duly licensed practitioner authorized by the laws of the state to prescribe medicinal drugs; or "3. Ordered and dispensed by a pharmacist pursuant to the established dispensing procedures determined by the joint committee of medical, osteopathic and pharmacy professions as created by section 465.186, F.S. "(b) The sale of medical products or supplies to physicians, dentists, veterinarians and hospitals is taxable even though the medical products or supplies may be used in connection with medical treatment, unless the products and supplies are specifically exempt from tax under this rule or in Rule 12A-1.021, F.A.C. "(c) `Medical products and supplies, shall mean and include, but is not limited to, such items as cotton, knives, sewing and surgical needles, scissors, microscopes, x-ray machines, I.V. administration sets, laboratory apparatus, surgeons, gloves, ear syringes, and hospital beds."

Rule 12A-1.020(18), F.A.C., provides:

"(18) Orthopedic or corrective shoes.
"(a) Shoes made to specifications prescribed by a podiatrist, orthopedist or other physician for the purpose of treating or preventing illness or disease, or to correct physical incapacity are exempt from tax. Example: Shoes made from a mold of a foot or shoes with special devices to straighten malformed bones are exempt. "(b) Shoes made to order for special fitting problems such as narrow heels or extra large feet are taxable. "(c) When an ordinary shoe is modified to specifications prescribed by a podiatrist, orthopedist or other physician by the insertion of a lift, a wedge, or arch support for the purpose of treating or preventing illness or disease, or to correct physical incapacity, the charge for the ordinary shoe is subject to tax. However, any reasonable separately stated charge for the modification is exempt. If no separate charge is made for the modification, the entire charge is taxable. "(d) When an ordinary shoe is modified for a more comfortable fit (e.g., heel pad inserted, insole added,

etc.) improve styling or similar purposes, the entire charge is taxable."

Rule 12A-1.038(1), F.A.C., provides:

12A-1.038 Resale and Exemption Certificates. "(1) It is the specific legislative intent that each and every sale, admission, use, storage, consumption or rental is taxable under Chapter 212, F.S., unless such sale, admission, use, storage, consumption or rental is specifically exempt. The exempt status of the transaction must be established by the dealer. Unless the dealer shall have taken from the purchaser a certificate to the effect that the property or service was purchased for resale and bearing the name and address of the purchaser, the effective date of the certificate and the number of his dealer's certificate of registration, or a certificate bearing the number of his consumer's exemption certificate, and the effective date of the certificate, the sale shall be deemed to be a taxable sale at retail, except sales of alcoholic beverages by distributors, licensed by the Division of Alcoholic Beverage and Tobacco, Department of Business Regulation, to others who are also licensed by the Division of Alcoholic Beverage and Tobacco, Department of Business Regulation."

DEPARTMENT RESPONSE

Taxable Items

The taxable items include numbers 1, 2, 3, and 4. They are subject to tax as medical products used in connection with medical treatment. They can be purchased exempt from tax if dispensed according to an individual prescription written by a prescriber authorized by law to prescribe medical drugs, or sold to a purchaser for resale when the purchaser issues your company a properly executed resale certificate according to Rule 12A-1.038, F.A.C. Also exempt would be the sale of these items to an exempt entity that issues your company an exemption certificate under the provisions of Rule 12A-1.038, F.A.C.

Exempt Items
The exempt items are numbers 6 and 7. Number 6 is exempt as a medical product temporarily or permanently incorporated into a patient by a practitioner of the healing arts licensed by the State of Florida under Rule 12A-1.020(6)(a)l., F.A.C. Number 7 is exempt under Rule 12A-1.020(18), F.A.C., if it is made to specifications prescribed by a podiatrist, orthopedist or other physician for the purpose of treating or preventing illness, disease, or to correct physical incapacity.

We respectfully decline to give a binding opinion as to the taxable or exempt states of item 5, which is the Stomach Liner Tube as you did not provide a brochure on it. However, it appears to be exempt under Rule 12A-1.020(6)(a)l., F.A.C., as a medical product temporarily incorporated into a patient by a practitioner of the healing arts licensed by the State of Florida.

This response constitutes a Technical Assistance Advisement under s. 213.22, F.S., which is binding on the Department only under the facts and circumstances described in the request for this advice as specified in s. 213.22, F.S. Our response is predicated on those facts and the specific situation summarized above. You are advised that subsequent statutory or administrative rule changes or judicial interpretations of the statutes or rules upon which this advice is based may subject similar future transactions to a different treatment than expressed in this response.

You are further advised that this response and your request are public records under Chapter 119, F.S., which are subject to disclosure to the public under the conditions of s. 213.22, F.S. Your name, address, and any other details which might lead to identification of the taxpayer must be deleted by the Department before disclosure. In an effort to protect confidential information, we request you notify the undersigned in writing within 15 days of any deletions you wish made to the request or this response.

Sincerely,

Richard S. Harrod
Technical Assistant
Statutory Compliance Section

RSH/bc