Is the service of cleaning storage tanks subject to Kansas retailers' sales tax?

Plain-English summary

A taxpayer asked whether the service of cleaning storage tanks is subject to Kansas retailers' sales tax. The Department's answer: no — it is exempt.

The statute. K.S.A. 79-3603(q) imposes sales tax on "the gross receipts received for the service of repairing, servicing, altering or maintaining tangible personal property" that is not held for sale, "whether or not any tangible personal property is transferred," and applies even to property that "has been and is fastened to, connected with or built into real property."

The key distinction: cleaning is not maintaining. The Department relied on In re Tax Appeal of R & R Janitor Service, 9 Kan. App. 2d 500, 505 (1984), where the court held that "maintaining" means "keeping in repair or replacing" and is not synonymous with "cleaning." The court reasoned that ordinary cleaning work — vacuuming, dusting, washing windows, emptying trash — is not "maintenance," which means "holding, keeping or preserving [something] in [its] existing state or condition." It concluded that "cleaning services do not constitute 'servicing or maintaining an item of tangible personal property … fastened to, connected with [or] built into real property' within the meaning of that statute."

Result. Applying that reasoning, the Department ruled that the gross receipts from cleaning storage tanks are exempt from Kansas retailers' sales tax.

What this means for you

Tank cleaners and industrial cleaning services

Charges to clean a storage tank (or similar tangible personal property) are not taxable under the repair/service statute. Cleaning is legally different from repairing, servicing, altering, or maintaining, which are the taxable services in K.S.A. 79-3603(q).

Watch for bundled repair or maintenance

If a job goes beyond cleaning into repairing, servicing, altering, or maintaining the tank — patching, replacing parts, restoring it to working condition — those service charges can be taxable. Keep cleaning separately stated from any taxable repair work.

The principle is broader than tanks

The cleaning ≠ maintaining distinction from R & R Janitor Service applies generally: pure cleaning of tangible personal property is outside the 79-3603(q) service tax.

Common questions

Q: Is cleaning a storage tank taxable in Kansas?
A: No. The Department ruled that the gross receipts from cleaning storage tanks are exempt from Kansas retailers' sales tax.

Q: Why isn't cleaning covered by the repair/service tax?
A: Because "maintaining" in K.S.A. 79-3603(q) means keeping in repair or replacing — not cleaning. The court in In re R & R Janitor Service held cleaning is not servicing or maintaining tangible personal property.

Q: When would tank work become taxable?
A: If the service is actually repairing, servicing, altering, or maintaining the tank (not merely cleaning it), that charge can be taxable under 79-3603(q).

Q: Does this ruling apply to my business?
A: A Kansas private letter ruling addresses only the requesting taxpayer's facts and cannot be relied on as precedent by others, though it reflects the Department's reading of the cleaning-versus-maintaining line.

Citations and references

• K.S.A. 79-3603(q) — taxes the service of repairing, servicing, altering, or maintaining tangible personal property, including property fastened to or built into real property. Cleaning falls outside it.
• In re Tax Appeal of R & R Janitor Service, 9 Kan. App. 2d 500, 505 (1984) — holds "maintaining" means keeping in repair or replacing, not cleaning; cleaning services are not servicing or maintaining tangible personal property under the statute.
• K.A.R. 92-19-59 — the regulation authorizing Kansas private letter rulings.

Source

• Landing page: Kansas Department of Revenue Policy Information Library
• Original document: P-2003-005

Original ruling text

Private Letter Ruling

Body:

Office of Policy & Research

January 22, 2003

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Dear Mr. TTTTTT:

We wish to acknowledge receipt of your letter dated January 16, 2003, regarding the application of Kansas Retailers' Sales tax.

K.S.A. 79-3603(q) imposes a sales tax on, "the gross receipts received for the service of repairing, servicing, altering or maintaining tangible personal property. . . which when such services are rendered is not being held for sale in the regular course of business, and whether or not any tangible personal property is transferred in connection therewith. The tax imposed by this subsection shall be applicable to the services of repairing, servicing, altering or maintaining an item of tangible personal property which has been and is fastened to, connected with or built into real property"

In Re Tax Appeal of R & R Janitor Service, 9 Kan. App. 2d 500, 505 (1984) ("Maintaining" is keeping in repair or replacing, and is not synonymous with "cleaning").

The Court stated in part:

"R & R Janitor Service performed various cleaning services such as vacuuming, dusting, cleaning bathrooms, washing windows, and emptying trash. We find that a requirement in an ordinance of a duty 'to maintain' does not impose a duty of keeping siphons clean, since 'to maintain' is to 'keep in repair or replace.' Janitor work is not maintenance under a statute designating a fund for 'purchasing, constructing, repairing and maintaining buildings for public school purposes; maintenance meaning holding, keeping or preserving them in their existing state or condition.' The Nevada court held provisions in a contract for 'repair and maintenance' did not require parties to keep alleys clean, but did require keeping the alley's surfaces in their original condition. Cleaning services do not constitute 'servicing or maintaining an item of tangible personal property which has been fastened to, connected with our built into real property' within the meaning of that statute."

It is the opinion of the Kansas Department of Revenue the gross receipts from the service of cleaning storage tanks is exempt from Kansas retailers' sales tax.

This is a private letter ruling pursuant to K.A.R. 92-19-59. It is based solely on the facts provided in your request. If it is determined that undisclosed facts were material or necessary to an accurate determination by the department, this ruling is null and void. This ruling will be revoked in the future by the operation of law without further department action if there is a change in the statutes, administrative regulations, or case law, or published revenue ruling, that materially effects this private letter ruling. If I may be of further assistance, please contact me at your earliest convenience at (785) 296-7776.

Sincerely yours,

Thomas P. Browne, Jr.
Tax Specialist

TPB

Date Composed: 02/10/2003 Date Modified: 02/10/2003

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