Kansas State Tax Rulings
Free plain-English summaries of state tax letter rulings and advisory opinions issued in Kansas, with full citations and the original source on every page.
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Is a church's direct purchase exempt from Kansas sales tax, and how does it claim the religious-organization exemption?
Yes. The Department determined that the church is a 'religious organization' under K.S.A. 79-3606(aaa), so its direct purchases used exclusively for religious purposes are exempt from Kansas retailers…
Does a Kansas manufacturer charge sales tax on separately invoiced customized dies and artwork that stay in Kansas?
It depends on who the customer is. When a Kansas manufacturer sells to a bona fide reseller and bills the reseller for both the manufactured item and the customized items (dies, artwork, silk screens,…
Is cattle-management computer software and hardware bought by a farmer exempt as farm machinery and equipment?
Taxable -- it is not exempt farm machinery. Under K.S.A. 79-3606(t), the farm machinery and equipment exemption covers farm and aquaculture machinery and equipment, repair and replacement parts, and r…
Which repair items for a farmer's combine and tractor qualify for the Kansas farm machinery exemption?
It depends on the item. Under K.S.A. 79-3606(t), the Department's opinion is that bolts, nuts, washers, cotter keys, and hydraulic and motor oil used in the repair and maintenance of a combine and tra…
Is tangible personal property used to align a vehicle with a trailer, boat, or camper taxable in Kansas, and is there a safety-equipment exemption?
Yes. Under K.S.A. 79-3603(a), the retail sale of tangible personal property used to align a vehicle with a trailer, boat, or camper is subject to Kansas sales tax. The Kansas Sales Tax Act contains no…
What must a seller obtain to make tax-exempt sales of pianos, repair labor, and parts to a religious organization?
A seller making tax-exempt sales to a religious organization — including selling a piano, labor to repair and maintain pianos, and repair or replacement parts — must obtain a properly completed exempt…
Is a Kansas sale exempt when the buyer's affiliated common carrier picks up the goods and hauls them out of state?
The sale is not subject to Kansas sales tax if it meets the conditions of K.A.R. 92-19-29. A manufacturer sold goods to Corporation A (a member of an affiliated group, not a common carrier), which dir…
Are transportation charges taxable when billed as part of a taxable repair service, and when are they exempt?
It depends on the primary service. If a roustabout is performing a taxable repair service, all charges tied to it — including transportation charges, whether separately stated or lumped in — are taxab…
What mineral severance tax exemptions and abandoned-well credit did Kansas add in 1998?
This 1998 legislative update summarizes new Kansas mineral (severance) tax exemptions effective July 1, 1998, plus a new income tax credit. Gas severed from a well whose average daily production has a…
How are Kansas broadcasters, cable, and subscriber and satellite TV/radio services taxed after the 1998 exemption?
Effective July 1, 1998, Senate Bill 493 added a sales tax exemption for over-the-air, free-access radio and television stations, and this notice explains four related provisions. Subscriber radio and …
Are internet access fees and web hosting charges subject to Kansas sales tax?
No. Charges for internet access fees and web hosting are not currently subject to Kansas sales tax. But the provider is the consumer of what it buys to deliver that nontaxable service — it must pay sa…
How do Kansas county appraisers identify and value non-productive 'waste' land within agriculturally classified property?
Within agriculturally classified land, non-productive 'waste' areas are valued at $10.00 per acre. This 1998 Division of Property Valuation memo helps county appraisers identify waste land — the test …
How do Kansas county appraisers adjust the agricultural use value of farmland whose productivity is reduced by salinity or alkalinity?
Farmland whose productivity is reduced by salinity or alkalinity can have its agricultural use value adjusted, but only for specifically identified areas where the condition is hindering normal croppi…
Can a company that buys bulk gas tanks to lease to customers purchase the tanks exempt from Kansas sales tax?
Yes. Because Kansas sales tax applies only to retail sales — sales to the final user or consumer — a company that buys bulk liquefied gas tanks in order to lease them to its customers is not the final…
Is installing a new swimming pool at a residence exempt from Kansas sales tax as residential remodeling?
Yes. Installing a new swimming pool (or tool shed or similar structure) near an existing residence qualifies as exempt residential remodeling when the structure is intended to serve the residence, so …
How is a 501(c)(7) not-for-profit country club's real property classified and assessed for Kansas property tax?
It depends on how each part of the property is used. Following a Board of Tax Appeals decision (Manhattan Country Club, Docket No. 97-1460-PR), this memo tells county appraisers that portions of a 501…
In a pick-and-pack fulfillment arrangement, are the printing costs, picking fees, and packing fees subject to Kansas sales tax?
In this pick-and-pack and printing arrangement, the Department ruled that the printing costs are taxable — Kansas sales tax if the material is printed in Kansas, otherwise Kansas compensating (use) ta…
What sales tax exemptions and changes took effect in Kansas on July 1, 1998?
This notice summarizes the sales tax legislation that took effect in Kansas on July 1, 1998. Key changes: the aircraft exemption for licensed air carriers was extended to sales made through the carrie…
Is leasing hard-drive space on a computer system to store voice and fax messages subject to Kansas sales tax?
No. A business that leases space on its computer system's hard drive — used by customers to store voice or fax messages that callers can access — is providing a non-taxable service. The Department rul…
Can an out-of-state contractor use a resale exemption certificate to buy materials tax-free in Kansas?
No, in general. An out-of-state contractor cannot use a resale exemption certificate to buy materials (such as carpet) tax-free in Kansas — under K.S.A. 79-3603(l), contractors are the final users of …
Is residential and commercial telephone service — both intrastate and interstate — subject to Kansas retailers' sales tax?
Yes. The Department ruled that gross receipts from intrastate residential and commercial telephone service, and from interstate residential and commercial telephone service, are subject to Kansas reta…
Are gross receipts from selling internet disk space (server storage) and web-page design subject to Kansas retailers' sales tax?
No. A company planning to form an LLC to resell disk space and access on a server and to design World Wide Web pages asked whether those internet services are taxable. The Department ruled that gross …
Can a trade-in allowance reduce the taxable gross receipts on a lease, and when does the trade-in count?
It depends on who owns the trade-in. Leasing tangible personal property is taxable under K.S.A. 79-3603(h). The Department ruled that a taxpayer may not reduce reported gross receipts by a trade-in al…
Does a rodent barrier used to protect stored farm machinery qualify as exempt farm machinery and equipment?
No. Kansas exempts sales of farm machinery and equipment under K.S.A. 79-3606(t), but the Department ruled that a product designed to keep mice from entering an encircled area around stored farm machi…
Must a Kansas buyer pay the compensating use tax billed by an out-of-state seller that has no Kansas warehouse, absent an exemption certificate?
Yes. An out-of-state seller registered to collect Kansas compensating (use) tax shipped equipment to a Kansas buyer and billed the tax; the buyer refused, arguing the seller had no Kansas warehouse. T…
How should Kansas county appraisers handle 'adverse influences' on agricultural land under the use-value formula so land is not adjusted twice for the same factor?
This 1998 memo from the Division of Property Valuation tells Kansas county appraisers how to handle 'adverse influences' when valuing agricultural land at use value. With detailed soil types now built…
Does Kansas use tax apply to promotional materials a printer is obligated to deliver to a Kansas address?
Yes. Kansas use tax is levied for the privilege of using, storing, or compounding tangible personal property in the state, at a rate of 4.9% of the consideration paid. The Department ruled that a comp…
Is labor to install or apply property during the original construction of a new building subject to Kansas sales tax?
No. Kansas taxes the service of installing or applying tangible personal property under K.S.A. 79-3603(p), but that statute expressly exempts installation or application performed in connection with t…
Are materials sold to a contractor building on an Indian reservation in Kansas subject to Kansas sales or use tax?
Yes. Under K.S.A. 79-3603(l), sales of tangible personal property to contractors, subcontractors, and repairmen are subject to Kansas retailers' sales or compensating use tax, because contractors are …
When a retailer/contractor pulls resale-inventory materials to do a construction job, is Kansas sales tax due even if the job is out of state?
Yes. Under K.A.R. 92-19-66(c), a retailer whose principal business is retail selling may buy materials tax-free for resale, but when that retailer acts as a contractor and removes materials from inven…
Are laboratory and analytical testing services (chemical, metallurgical, calibration) subject to Kansas sales tax?
No. The Department ruled that the testing services described — chemical analysis, analysis of mechanical properties, metallurgical testing, pressure/load/hardness/conductivity testing, and accuracy (c…
Is a service that administers employee business-expense reimbursements subject to Kansas sales tax?
No. A company that administers business-expense reimbursements to Kansas employers' employees — reimbursing employees for equipment they bought and already paid Kansas sales/use tax on — asked whether…
When can a rock quarry sell rock exempt from Kansas sales tax — to a trucker, a contractor, or a concrete plant?
It depends on the buyer. Kansas sales tax applies only to retail sales (sales to final users). A quarry may sell rock exempt to a trucker who gives a valid resale exemption certificate (the trucker th…
Is Kansas sales tax charged on a discount when the manufacturer offering it is not reimbursed?
No — not on that discount. Kansas taxes the gross receipts from retail sales (K.S.A. 79-3603(a)), and the taxable 'selling price' is the total cost to the consumer exclusive of discounts (K.S.A. 79-36…
Does an insurance company owe Kansas sales tax when a vehicle is totaled and the owner keeps it minus a salvage deduction?
No. Kansas sales tax applies to gross receipts from the sale of tangible personal property (K.S.A. 79-3603(a)). The Department ruled that when an automobile is determined a total loss and the owner el…
Which purchases by a nonprofit domestic-violence shelter are exempt from Kansas sales tax — food, educational materials, or repair materials?
It depends on the item. Kansas has no exemption for the food a domestic-violence/rape shelter buys to provide meals, so those purchases are taxable. Free educational materials the shelter distributes …
Which advertising-agency services are exempt from Kansas sales tax and which are taxable?
Some are exempt, some are taxable. Under K.S.A. 79-3606(pp), services rendered by an advertising agency are generally exempt from Kansas sales tax. But when the agency produces and sells tangible outp…
Is gas consumed by pollution-control equipment to treat manufacturing by-products exempt from Kansas sales tax?
Yes. K.S.A. 79-3606(n) exempts tangible personal property consumed in production or manufacturing — including the treating of by-products or wastes derived from a production process. The Department ru…
Is a subscriber programmed-music/audio service delivered by satellite subject to Kansas sales tax, including equipment charges?
Yes. Kansas taxes the gross receipts from cable, community antennae, and other subscriber radio and television services under K.S.A. 79-3603(k). The Department ruled that the service the company recei…
Are retail sales of hair care products subject to Kansas sales tax?
Yes. Kansas taxes the gross receipts from retail sales of tangible personal property under K.S.A. 79-3603(a), and the Department ruled that Kansas sales and use tax law provides no exemption for the h…
Are sales of multi-nutrient health foods and vitamins subject to Kansas sales tax?
Yes. Kansas taxes gross receipts from retail sales of tangible personal property under K.S.A. 79-3603(a), and the Department ruled that Kansas law provides no exemption for the sale of multi-nutrient …
Does finishing unfinished space in a previously constructed building qualify as exempt original construction in Kansas?
No, on these facts. Kansas exempts labor to install or apply property in the original construction of a building, and regulation K.A.R. 92-19-66b(f) sets a four-part test for treating the completion o…
How is the taxable base figured for a taxable installation/application contract, and can a contractor deduct overhead and profit?
The taxable base for a contract to install or apply tangible personal property is the difference between the contract price and the cost of materials, supplies, and subcontractor payments (including t…
What amount is the Kansas 10% tobacco products tax charged on — and can a distributor deduct discounts?
The 10% Kansas tobacco products tax is charged on the wholesale sales price — the amount shown on the manufacturer's original invoice. Under K.S.A. 79-3371 the tax is 10% of the wholesale sales price …
Are implantable medical devices like filters, stents, and vascular grafts exempt from Kansas sales tax as prosthetic and orthopedic appliances?
Yes. K.S.A. 79-3606(r) exempts sales of prosthetic and orthopedic appliances prescribed in writing by a person licensed in the healing arts, dentistry, or optometry — apparatus, instruments, devices, …
Does a company that delivers and sets up appliances for a retailer collect Kansas sales tax, or does the retailer?
The delivery firm does not collect the tax; the appliance retailer does. The Department found that a company that merely delivers, uncrates, sets up, and test-runs appliances for a retailer is providi…
What interest rate did Kansas charge on tax liabilities for 1998, and how is it set?
For 1998, Kansas interest on tax liabilities is 0.833% per month (10% per year). The notice gives the historical rates -- 1.5% per month (18% per year) before January 1, 1995, and 1% per month (12% pe…
Is the federal excise tax part of the Kansas sales tax base on retail sales and leases?
The Department directs that the federal excise tax imposed under Internal Revenue Code Section 4001 et seq. on the sale of passenger vehicles, heavy trucks and trailers, boats, aircraft, jewelry, and …
When is Kansas personal property tax due on a motor vehicle that was purchased in — or brought in from — another state?
It depends on whether the owner can prove the vehicle was kept (stored, garaged, or operated) outside Kansas. This 1997 joint memo from the Division of Vehicles and Property Valuation Division tells c…
When a taxpayer makes a payment on a past-due Kansas tax account, is it applied to tax, interest, or penalty first?
Tax liability first, then interest, then penalty last. On August 27, 1997, the Kansas Department of Revenue's Policy Council decided that, effective with the implementation of the Department's new int…
Can sales tax, freight, and installation charges be included in the 'retail cost when new' used to value commercial and industrial personal property in Kansas?
Sales tax is never part of it, and separately stated freight and installation can be excluded. This 1997 Division of Property Valuation memo explains the Kansas Supreme Court's decision (Board of Coun…
What rights do taxpayers have during a Kansas tax audit under the 1997 Tax Equity and Fairness Act?
Effective July 1, 1997, this directive from the Secretary of Revenue tells all Department auditors to give taxpayers three protections required by the Kansas Tax Equity and Fairness Act of 1997 (H.B. …
What crude oil severance tax exemption levels applied in Kansas from May 1997 through April 1998?
For the fiscal period May 1, 1997 through April 30, 1998, the Kansas crude oil severance tax exemption levels were set using a determined average oil price of $21.98 per barrel. Because that price is …
Must a Kansas licensed vehicle dealer collect sales tax on a vehicle sold to a Native American who lives on a reservation?
Yes, in almost all cases. This 1997 memo to Kansas vehicle dealers and county treasurers states that a Kansas licensed dealer must collect sales tax at the time of sale on a vehicle sold to a Native A…
When is an oil drilling workover rig exempt from Kansas vehicle registration, and how do you claim it?
Only single-purpose rigs that meet specific design tests, and only from registration -- not from property tax. This 1997 Division of Vehicles memo says an oil drilling workover rig is exempt from vehi…
What did the 1996 Kansas cigarette and tobacco legislation change for dealers, minors, and vending machines?
Effective July 1, 1996, the 1996 Kansas cigarette and tobacco legislation increased regulation of the sale of cigarettes and tobacco products. The biennial Kansas Cigarette License fee rose from $12 t…
How did Senate Bill 704 change the Kansas petroleum products inspection fee on July 1, 1996?
Effective July 1, 1996, Senate Bill 704 modified the Kansas Petroleum Products Inspection Law as part of a Department of Agriculture fuel-quality package. The changes: the Petroleum Products Inspectio…
How did House Bill 2663 change the Kansas sand royalty effective July 1, 1996?
Effective July 1, 1996, House Bill 2663 amended K.S.A. 70a-102 to increase the sand royalty rate to $.15 per ton for sand removed, authorize the Secretary of Revenue to set by rule and regulation the …
What crude oil severance tax exemption levels applied in Kansas from May 1996 through April 1997?
For the fiscal period May 1, 1996 through April 30, 1997, the Kansas crude oil severance tax exemption levels were set using a determined average oil price of $15.81 per barrel. Because that price is …
Is tire retreading for interstate common carriers subject to Kansas sales tax?
In this letter to the Kansas Tire Dealers Association, the Secretary of Revenue determined that the sale of retread tires to interstate common carriers is not subject to Kansas sales tax. Interstate c…
Browse Kansas rulings by topic
These are official tax letter rulings and advisory opinions issued by Kansas's revenue authority in response to questions from specific taxpayers about how the tax law applies to their facts. A ruling is binding on the department only for the taxpayer who requested it and cannot be relied on by anyone else, but it is strong evidence of how the state reads the law. Every ruling above has a plain-English question and short answer, plus a link to the full original source.