Ezel / Tax Rulings / NE
NE 01-91-2 Sales and Use Tax 1991-10-16

Is a contract to care for and maintain live plants (like office interior plants) subject to Nebraska sales tax?

Short answer: Yes. Under Revenue Ruling 01-91-2, when the owner of live plants that are not incorporated into real property buys an agreement providing for the continuing care or upkeep of those plants, the sale of that agreement is taxable as a service or maintenance agreement. It doesn't matter that the agreement covers only labor and doesn't include replacing the plants — a labor-only care agreement is still taxable.

Apply this to your situation

This page answers the general question as of 1991. Ezel answers yours, under current Nebraska tax law, with citations.

Currency note: this ruling is from 1991
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Ruling is a general statement of Department policy rather than advice to a single taxpayer, but it can be amended, superseded, or made obsolete by a later ruling or a change in statute or regulation, many rulings in this series have been rescinded or superseded, so confirm it is still in effect before relying on it.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

Businesses often hire a plant service to come in and water, prune, and tend the live plants in an office lobby, restaurant, or mall — the plants stay owned by the customer and aren't built into the building. This ruling asks whether the contract for that ongoing care is subject to Nebraska sales tax.

The answer is yes. When the owner of live plants that are not incorporated into real property buys an agreement for the continuing care or upkeep of those plants, the sale of the agreement is taxable as a service or maintenance agreement.

The ruling makes one point especially clear: it is irrelevant that the agreement does not provide for replacing the plants. In other words, a labor-only care agreement — just the tending, no new plants supplied — is still taxable. You don't avoid the tax by leaving replacement out of the contract.

The phrase "not incorporated into real property" matters. The ruling addresses plants that remain movable, customer-owned personal property (like potted interior plants), not landscaping planted into the ground as part of the real estate.

Approved by State Tax Commissioner M. Berri Balka in October 1991.

Source-quality note: the official PDF is a scanned image and the machine-extracted "Original ruling text" below is heavily garbled. The holding stated here — that a continuing-care agreement for live plants not incorporated into real property is a taxable service or maintenance agreement, even if labor-only — was confirmed against a cleaner reading of the same scanned document. The raw extraction is preserved below for transparency, and the exact day of the October 1991 approval date is not clearly legible in the scan.

What this means for you

Interior-plantscaping and plant-care companies

If you sell Nebraska customers an ongoing agreement to maintain their live indoor plants, that agreement is a taxable service or maintenance agreement — collect sales tax on it. Structuring the deal as labor-only (no plant replacement) does not make it exempt.

Businesses that buy plant-care services

Expect Nebraska sales tax on your plant-maintenance contract. The tax applies to the care agreement itself, whether or not it includes replacing plants that die.

Common questions

Q: Is a live-plant maintenance contract taxable in Nebraska?
A: Yes. An agreement for the continuing care or upkeep of live plants not incorporated into real property is taxable as a service or maintenance agreement.

Q: What if the contract only covers labor and never replaces the plants?
A: It's still taxable. The ruling says it is irrelevant that the agreement does not provide for replacing the plants — a labor-only agreement is taxable.

Q: Does this cover plants that are part of the landscaping?
A: The ruling addresses live plants not incorporated into real property — movable, customer-owned plants. Plants incorporated into the real estate are a different situation not decided here.

Citations and references

  • No statutes are cited within the text of this ruling; it applies Nebraska's tax on service or maintenance agreements to agreements covering the ongoing care of live plants that are not incorporated into real property.

Source

Original ruling text

Tnebraska

Revenue Ruling L'9L-2

I deoartment
'revenue
I of

ROVIDES

LANTS NOT INCORPORÀTED INTO REAL
PROPERTY IS A TAXABLE SERVICE OR MAINTENANCE AGREEMENT'

which
Advice has been requested as to whether an agreement
plants
not
l-ive
of
upkeep
care.or
frovides for the cóntinuing
or
service
irr.otporated into real proþerty is a taxable

maintenance agreemenf .

live plants not incorporated into real
property purchases an agreement which provides for the
ãon|inning care or upkeep of the plants, the sale of the
agreement is taxable as a service or maintenance agreement' It
is irrelevant that the agreement does not provide for the
replacement of the planté (i.e., a labor only agrgement).

When the owner of

APPROVED:

M. Berri
State Tax Commissioner

october ILI , 1991

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