Ezel / Tax Rulings / NE
NE 01-77-11 Sales and Use Tax 1977-07-20

Does a Nebraska golf course have to charge sales and use tax on fees for cleaning and storing customers' golf equipment?

Short answer: No. A golf course operator's charges for cleaning and storing golf equipment are not subject to Nebraska sales and use tax. Under Revenue Ruling 01-77-11, cleaning golf equipment and storing equipment owned by others are both nontaxable services; the operator providing the service is the ultimate consumer of any tangible personal property it consumes in performing that service, so the service charges to customers are not taxed.

Apply this to your situation

This page answers the general question as of 1977. Ezel answers yours, under current Nebraska tax law, with citations.

Currency note: this ruling is from 1977
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official Revenue Ruling of the Nebraska Department of Revenue, a guidance document stating the Department's interpretation of how Nebraska tax law applies. Each Nebraska guidance document carries the notice that it 'is advisory in nature but is binding on the Nebraska Department of Revenue until amended.' Unlike a private letter ruling, a Revenue Ruling is a general statement of Department policy rather than advice to a single taxpayer, but it can be amended, superseded, or made obsolete by a later ruling or a change in statute or regulation, many rulings in this series have been rescinded or superseded, so confirm it is still in effect before relying on it. Nebraska's local option sales and use taxes are administered by the Department, not self-collected by home-rule cities. This summary is informational only and is not legal or tax advice. Consult a licensed Nebraska tax professional about your situation.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page as a PDF) is the authoritative source for any reliance.
View original ruling (PDF)

Plain-English summary

Golf courses often clean and store members' clubs and bags for a fee. This ruling answers whether Nebraska sales and use tax applies to those charges. It does not.

The core holding: charges for cleaning and storing golf equipment by someone operating a golf course "are not subject to sales and use tax."

The Department's reasoning:

  • An operator of a golf course who cleans golf equipment is providing a nontaxable service.
  • An operator who stores golf equipment owned by others is likewise providing a nontaxable service.
  • The person providing the service is the ultimate consumer of any tangible personal property that is consumed in performing the service -- so the tax falls on the operator's own purchases of those supplies, not on the service charge billed to the customer.

Put together, the service of cleaning and storing golf equipment is not subject to Nebraska sales and use tax.

What this means for you

Golf courses and pro shops

Fees you charge members for cleaning and storing their clubs and bags are nontaxable services -- you do not charge sales tax on them. But note the flip side: because you are the ultimate consumer of the supplies you use to perform the service (cleaners, storage materials, and the like), you owe sales or use tax when you buy those supplies.

Golfers and club members

Do not expect Nebraska sales tax on a locker, bag-storage, or club-cleaning fee at the course. Those are treated as nontaxable services.

Accountants and tax professionals

This is a straightforward service-vs-sale ruling: the labor of cleaning and storing is a nontaxable service, and the tax attaches upstream to the provider's purchases of consumables. Because it dates to 1977, confirm current Nebraska law on services and on the taxability of storage before relying on it.

Common questions

Q: Does a golf course charge sales tax on club-cleaning or storage fees?
A: No. The Department holds that cleaning and storing golf equipment are nontaxable services, so the fees are not subject to Nebraska sales and use tax.

Q: Does the golf course owe any tax at all?
A: Yes -- on its own end. As the ultimate consumer of the supplies it uses to perform the service, the operator owes sales or use tax when it purchases those consumables.

Q: Can I rely on this 1977 ruling today?
A: It states the Department's position and is "binding on the Nebraska Department of Revenue until amended," but it is decades old. Verify current law and consult a Nebraska tax professional.

Citations and references

  • Nebraska Revenue Ruling 01-77-11, "Sales and Use Tax -- Storage and Servicing of Golf Equipment" (Nebraska Department of Revenue, issued July 20, 1977; approved by the State Tax Commissioner).
  • Nebraska sales and use tax treatment of services versus sales of tangible personal property, and the "ultimate consumer" rule for property consumed in performing a service (Nebraska Revenue Act of 1967, as amended).

Source

Source-quality note: This ruling survives only as a low-quality scan, and the machine-extracted text below has minor OCR artifacts (garbled headings and signature block). The holding and its service / ultimate-consumer reasoning are legible and are the basis for this summary.

Original ruling text

R'evenue Ru1ing L-77-LL

Sales and Use Tax - Stora

and Servicin

of Golf E UI

nt.

U P

OPERATING A GOLF COURSE ARE NOT SUBJECT TO SALES AND USE
TAX.

Advice has been requested as to whether charges for cleaning
and storing gotf equipment would be subject to Nebraska
sales and u,se tax.
An operator of a golf course who cleans golf equipment is
providing a nontaxable service. An operator of a golf
õourse wño stores golf equipment owned by others is providing
a nontaxable serviòe. The person providing the services is

the ultimate consumer of tangible personal property consumed
by him in the performance of the services.
The service of cleaning and storing golf equipment is not
subject to Nebraska sales and use tax.

APPROVED:

ters
am
State Tax Commissioner

July 20 ' L977

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