Did a condominium association have to collect Florida tax on extra resident parking and mandatory valet parking for residents or visitors?

Subject

Motor Vehicle Parking

Plain-English summary

The condominium association had to collect Florida sales tax on all three parking arrangements it described. Those arrangements were:

• a resident's extra assigned covered space without valet service;
• a resident's guaranteed but unassigned space with valet service; and
• mandatory valet parking for visitors and guests.

Florida taxed the privilege of leasing or renting motor-vehicle parking space. For the two valet arrangements, the service did not become exempt merely because services are generally nontaxable. Valet was bundled into the parking charge, and residents or visitors could not separate or avoid it, so the entire amount was taxable.

The spaces were condominium common elements, but that did not change the result. The ruling explained that parking was specifically taxed under section 212.03(6) and excluded from the separate real-property rental tax under section 212.031, making a section 212.031 common-elements exemption irrelevant.

What this means for you

Charging separately for an extra condominium parking privilege creates a taxable parking transaction even when the space belongs to the association's common elements.

Bundled valet charges follow the parking charge when the customer cannot decline valet or the service is not separately itemized. The source did not identify any nontaxable parking category among the three reviewed.

Common questions

Q: Was an assigned resident space taxable without valet service? Yes. The resident paid for the extra parking privilege itself.

Q: Was resident valet parking taxable? Yes. The flat monthly charge covered guaranteed parking and inseparable valet service.

Q: Was mandatory guest valet parking taxable? Yes. Guests had no self-parking option, so tax applied to the entire charge.

Q: Did the condominium common-elements exemption apply? No. The Department said parking was taxed under the specific parking statute rather than the real-property rental provision containing that exemption.

Q: Was any refund due for tax already collected? No. All three reviewed charges were taxable.

Citations and references

• Fla. Stat. § 212.03(6) — tax on leasing or renting motor-vehicle parking or storage space
• Fla. Stat. § 212.031(1)(a)3. — exclusion from real-property rental tax for parking already taxed under section 212.03(6)
• Fla. Stat. § 215.26; Fla. Admin. Code ch. 12-26 — refund materials provided for general information
• Fla. Stat. § 213.22 — Technical Assistance Advisements

Source

• Landing page: Florida Tax Law Library
• Advisement: TAA 98A-033

Original ruling text

SUMMARY

A condominium association is to collect sales tax as
imposed by s. 212.03(6), F.S., in the following three
instances when charges are made on the unit owners or
tenants, or visitors or guests of such owners or tenants
for the privilege of parking motor vehicles on land which
is said to be "part of the common elements of the real
property owned by the [Association]."

(1) When the owner or tenant contracts for an extra
assigned parking space with no valet service provided.

(2) When the owner or the tenant contracts for an extra
unassigned parking space with valet service, and

(3) When the visitor or guest of an owner or tenant is
required to use unassigned parking space with valet
service.

May 07, 1998

Re: Technical Assistance Advisement 98A-033
Motor Vehicle Parking
Section 212.03(6), F.S.
Section 212.031, F.S.
XXX (herein "Club")

Dear :

This is a response, styled a Technical Assistance Advisement, to
your letter dated January 27, 1998, in which you asked 5
questions, all in connection with motor vehicle parking spaces
provided by Club. Club is a condominium association which
provides 3 types of parking privileges to owners and lessees of
condominium units, visitors, and the guests of such owners and
lessees.

You attached to your letter a copy of a document entitled
Application For Extra Parking Space, and an accounting "work
sheet" in which parking and other charges are noted, including
the sales tax on such charges collected by Club. You ask
whether these classes of parking are subject to sales or use tax
and you ask two related questions which shall be answered at the
end of this letter. You also state that all the parking spaces
used to provide parking are "part of the common elements of the
real property owned by the taxpayer."

The 3 types of parking provided by club are described in your
letter as follows:

A. Resident Extra Parking Space (i.e., Owner of an
apartment or tenant of an apartment): In this category the
resident of an apartment pays a flat monthly amount plus
sales tax, for an additional parking space. This extra
parking space is undercover and assigned only to the
permanent resident and no one else is allow[sic] to use
this assigned parking space. The permanent resident must
have a gate card that enable[sic] him/her access to the
extra parking space, the resident parks his/her own
automobile without the service of the valet personnel.

B. Resident Parking Space with Valet Service (i.e., Owner
of an apartment or tenant of an apartment): In this
category the resident of an apartment pays a flat monthly
amount plus sales tax, for a non assigned valet parking
space. This parking space is not exclusively assigned to
the resident. The valet personnel park the automobile in
any valet parking space that is available at the time that
the resident uses the valet parking service. The resident
is not entitled to claim a specifically assigned parking
space, however a valet parking space is guarantee[d] at all
times.

C. Visitors or Guest Valet Parking: This category is valet
parking service offered only to visitors, or guests (i.e.,
not available to a resident). When any outside visitors or
guests (i.e., not a resident) enters the taxpayer premises,
the visitor or guest must stop at the entrance of the

building area where the valet personnel office is located,
in this area the visitor or guest must exit his/her
automobile and turn the automobile to the valet personnel,
the valet personnel are the only persons that can park the
vehicle in the designated valet parking area for visitors
and guest. Outside visitors or guests do not have the
option to park their own automobiles, they only have the
option to have their vehicles park[sic] by the valet
personnel.

You ask in the first three questions whether any of the parking
privileges described above are subject to sales tax or use tax
under s. 212.03(6), Florida Statutes. In a fourth question, you
ask whether any of the parking services are not subject to tax.
Your fifth question concerns the refund process in the event
sales tax, on any of the parking privileges, was collected
erroneously by Club.

Department Response

Question #1: "Is the taxpayer required under Florida s.
213.03(6), F.S. to charge sales tax on Residents Extra Parking
Space?"

Answer: Yes. Section 212.03(6), Florida Statutes, clearly
subjects the parking described as "Residents Extra Parking" to
sales tax. Section 212.03(6) provides as follows:

It is the legislative intent that every person is engaging
in a taxable privilege who leases or rents parking or
storage spaces for motor vehicles in parking lots or
garages, who leases or rents docking or storage spaces for
boats in boat docks or marinas, or who leases or rents
tie-down or storage space for aircraft at airports. For
the exercise of this privilege, a tax is hereby levied at
the rate of 6 percent on the total rental charged.

Question #2: "Is the taxpayer required under Florida s.
213.03(6), F.S. to charge sales tax on Resident's Parking Space
with Valet Service?"

Answer #2: Yes. In your letter you stated that the payment for
this type of parking was a "flat monthly amount plus sales tax."
Thus, the entire amount charged is subject to sales tax pursuant
to s. 212.03(6), F.S. Services are generally not subject to
tax; however, where the services are not separately itemized or
where the buyer has no choice but to accept the service with the
payment to use the real property, then the sales tax is imposed
on the entire amount including that portion covering the
service.

It is interesting to note that while leases or rentals of
parking spaces are taxed pursuant to s. 212.03(6), F.S., charges
for the "renting, leasing, letting, or granting of a license for
the use of any real property" are taxed pursuant to s. 212.031,
F.S. Thus, s. 212.031, F.S. is broader than s. 212.03(6), F.S.
and, without more, would appear to impose an additional tax on
the lease or rental of parking spaces. However, the legislature
provided for this problem in paragraph (1)(a)3. of s. 212.031,
F.S., where it states that property subject to tax pursuant to
s. 212.03(6), F.S., will not be subject to the tax imposed by s.
212.031, F.S. In providing this exception to the application of
s. 212.031, F.S., the legislature avoided the problem of double
taxation on the same transaction.

It is also interesting to note that the exception in s.212.031,
F.S, for recreational property and common elements of a
condominium "when subject to a lease between the developer or
owner thereof and the condominium association in its own right
or as agent for the owners of individual condominium units or
the owners of individual condominium units...." will not apply
to the lease of parking by an owner or developer because all
leases of parking are specifically made subject to the tax
imposed by s. 212.03(6), F.S. and are specifically excluded from
the imposition of the tax pursuant to s. 212.031, F.S. Thus, if
the parking is not subject to the tax imposed by s. 212.031,
F.S., then an exemption therefrom would be irrelevant.

Question #3: "Is the taxpayer required under Florida s.
213.03(6) F.S., to charge sales tax on the Visitors, or Guests
Valet Parking Service?"

Answer #3: Yes. You stated in your letter that "the valet
personnel are the only persons that can park the vehicle in the
designated valet parking area for visitors and guest. Outside
visitors or guests do not have the option to park their own
automobiles, they only have the option to have their vehicles
park by the valet personnel." Thus, as stated above in response
to question #2, services are generally not subject to tax;
however, where the services are not separately itemized or where
the buyer has no choice but to accept the service with the
payment to use the real property, then the sales tax is imposed
on the entire amount including that portion covering the
service.

Question #4: "Are any of the parking services offered not
subject to sales tax?"

Answer #4: No, all are subject to sales tax.

Question #5: "In the event that an erroneous collection of sales
tax was made on the parking services offered by the taxpayer,
who is entitle[d] to the sales refund and what is the statute of
limitations on refunds: Are the residents that paid the
erroneously charged sales tax to be refunded first and then the
taxpayer is to claim the refund from the Florida Department of
Revenue?"

Answer #5: Sales tax is due on all three types of parking
examined in this letter; thus, no refunds are appropriate.
However, for your information and education, I have enclosed a
copy of the statute governing refunds, s. 215.26, F.S. and a
copy of the rule addressing refunds, Rule 12-26, F.A.C. These
should give you all the information you need to request a refund
should you ever have occasion to do so.

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 the confidentiality
of such information, we request you notify the undersigned in
writing within 15 days of any deletions you wish made to the
request or the response.

Sincerely,

Robert G. Parsons
Tax Law Specialist
Technical Assistance and
Dispute Resolution

Ctrl. No. 32692