New York State Tax Rulings
Free plain-English summaries of state tax letter rulings and advisory opinions issued in New York, with full citations and the original source on every page.
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After a lessee defaults, is money an equipment lessor recovers by judgment or from a guarantor subject to NY sales tax?
It depends on the type of lease. For a TRUE lease, where the lessor collected tax on each monthly payment, any amount it later recovers on the default -- a court judgment against the lessee, or a paym…
Is the payroll a managing agent passes through for cleaning and maintenance workers subject to NY sales tax?
No. Building cleaning and maintenance services are generally taxable, but wages and other compensation an employer pays its own employees for those services are excluded from sales tax under Tax Law 1…
New York Advisory Opinion TSB-A-13(2)C: Does an S corporation keep its Empire Zone certification and tax benefits after transferring non-voting shares to grantor trusts treated as disregarded entities?
Yes. The Empire Zone certification and tax benefits survive the restructuring. Transferring non-voting shares to grantor trusts that are disregarded entities does not by itself break eligibility, prov…
Is an online driver-safety / point-reduction course subject to NY sales tax as prewritten software?
No. A DMV-regulated online accident-prevention course (an Internet Point and Insurance Reduction Program, or IPIRP) is a nontaxable educational service, not a sale of taxable software. Although the co…
If I install solar panels at my home in two separate stages, does each stage qualify for its own $5,000 tax credit, or is the credit capped in total per residence?
The $5,000 solar energy system equipment credit under Tax Law § 606(g-1) is a single aggregate cap per principal residence, not a separate cap for each installation stage. A taxpayer who installs sola…
New York Advisory Opinion TSB-A-13(1)C / 13(2)I: Does an LLC keep its Empire Zone certification and benefits after a foreign corporate member exits and the remaining member gifts a majority interest to a spouse?
Yes. The Empire Zone certification and tax benefits survive the change in the LLC's ownership. After the foreign corporate member transfers its interest (and recaptures its own credits) and the remain…
New York Advisory Opinion TSB-A-12(7)C / 12(32)S: Does a parent corporation keep the Empire Zone benefits of a certified subsidiary it absorbs in an IRC section 332 liquidation?
Yes, with a step. When a certified subsidiary is liquidated into its parent under IRC section 332 and the parent keeps running the same facility and employees in the zone, the parent stays eligible fo…
Are a commercial printer's purchases of mailing and reply envelopes subject to sales tax, or are they purchases for resale?
They are purchases for resale, not taxable. A commercial printer that prints individualized statements and stuffs them (with reply envelopes when requested) into outer mailing envelopes is making a re…
Does an operator of an Internet data center qualify for the NY sales-tax exemption on its equipment and related services?
Yes. A business that operates an Internet data center -- a facility specifically designed and built to provide a high-security environment for servers hosting websites, and that provides uninterrupted…
Is an edible gummy drinking cup exempt as food, or taxable as candy/confectionery?
It is taxable. Although NY exempts food and food products, candy and confectionery are not exempt (Tax Law 1115(a)(1)(i)). This edible gummy drinking cup is made of evaporated cane sugar and pectin an…
What NY/NYC parking taxes apply to a co-op's parking charges for members and for resident non-members?
A co-op (homeowner's association) member owes NO state or city parking tax on charges paid to the association or to the operator leasing the association's parking facility -- the homeowner's associati…
Do tuition payments for a dependent enrolled in a six-year pre-pharmacy/Doctor of Pharmacy program count as 'qualified college tuition expenses' under Tax Law § 606(t)(2)(C)?
No, not entirely. The Department held that the four-year Doctor of Pharmacy portion of the program is analogous to a post-baccalaureate or graduate degree program and its tuition is excluded from 'qua…
New York Advisory Opinion TSB-A-12(6)C: Does converting a certified corporation into a disregarded single-member LLC keep its Empire Zone certification, and do its EZ ITC and EIC carryover credits flow up to the parent without a carryforward limit?
Yes. Converting a certified corporation into a single-member LLC treated as a disregarded entity (via IRC sections 332, 334(b)(1), 337 and 381) does not end Empire Zone eligibility, and the EZ investm…
Are formal patent drawings taxable when delivered to attorney clients only in electronic form?
No. Sales tax applies to tangible personal property, which includes artistic items like sketches and drawings when delivered in a tangible (paper) form. But when the drawings are delivered solely elec…
Are downloadable craft patterns and project collections (eProjects) subject to NY sales tax?
No. Downloadable craft patterns (step-by-step instructions to make something) and eProjects (collections of multiple electronic patterns) are non-tangible digital files. They are not tangible personal…
Is a hotel buying (and reselling) AV services from its in-house AV provider, and is it liable for the AV sales tax it collects via master billing?
No, the hotel is not purchasing the AV services. Where the AV provider signs a separate contract directly with the hotel's guest for AV equipment and services -- the provider owns the equipment, only …
For New York's 548-day rule, until what age is a domiciliary's child treated as a 'minor' whose New York presence counts against the 90-day limit?
A child is treated as a minor for 548-day rule purposes only until the child turns eighteen. Tax Law § 2(4) defines 'minor' as a person who has not attained age eighteen, so only days a child under 18…
New York Advisory Opinion TSB-A-12(5)C: Can a company claim the accessible-vehicle tax credit for the incremental cost it paid to buy a used van that a previous owner had already converted for wheelchair accessibility?
Maybe -- the company can claim the credit for the incremental cost it paid (the excess over a comparable van) on a used vehicle a prior owner converted for wheelchair accessibility, capped at $10,000 …
Is a service that gathers, stores, and reports a customer's own data a taxable information service in NY?
No. Gathering and mapping a customer's data, storing it in a confidential per-customer online data warehouse, and using it to create customizable reports is an information service -- but one that is p…
Are design images taxable when delivered to customers only electronically as PDF files?
No. Tangible personal property -- which includes artistic items like sketches and drawings -- is taxable when delivered in tangible (paper) form. But where the design images are delivered solely elect…
Are an expert network's oral consultations, consultant directory/software, and custom research reports subject to NY sales tax?
Generally no. Oral consultations with the firm's expert consultants are not taxable -- they are guidance, advice, and perspective from the experts' own knowledge (not drawn from any common database), …
If I'm domiciled in New Jersey but buy a fractional, one-eighth ownership interest in a private residential club in New York City, does that ownership alone make me a New York State statutory resident for income tax purposes?
No. Because the Petitioner's right to use his club residence was capped at a 45-day priority period plus a first-come, first-served reservation system rather than free and continuous access, the Depar…
Are an equipment-rental firm's charges to deliver rented equipment, or to tow/transport customer-owned equipment, subject to NY sales tax, and at what rate?
It depends on what is being moved. A charge to deliver equipment the firm rents to the customer is taxable -- it is part of the rental receipt whether or not the delivery charge is separately stated. …
Is selling advertising space on installed displays a taxable service in NY, and are the charges to install, repair, and supply those displays taxable?
The advertising sales are not taxable, but the related installation, repair, and materials charges are. Selling advertising space on digital, backlit, scroll, wrap, and banner displays is not one of t…
Are the fees for a vehicle fleet Maintenance Management Program -- arranging discounts, overseeing repairs, and billing -- subject to NY sales tax?
Generally no. The firm doesn't own or run a repair shop; it negotiates discounts, has its technicians review whether repairs are necessary and fairly priced, acts as liaison with service providers, an…
Is the service of installing and dismantling scaffolding, safety netting, hoisting equipment, and temporary pedestrian walkways subject to NY sales tax?
It depends on whether the item is a 'temporary facility' and whether the underlying job is a capital improvement. Installing scaffolding, safety netting, hoisting equipment, and temporary pedestrian w…
Are portable-toilet rentals with waste removal exempt from NY sales tax when the customer is performing a capital improvement?
No. Providing portable toilets together with waste removal is a taxable service of maintaining/servicing real property under Tax Law 1105(c)(5), and the capital-improvement exclusion does not reach it…
For New York's '548-day rule,' do the days a Petitioner's minor child spends in New York at a legally separated spouse's home count against Petitioner, and what about days the child is with Petitioner on visitation?
No - if the taxpayer and spouse are legally separated under a written agreement giving the spouse physical custody, the child's days at the separated spouse's New York residence do not count toward th…
Are Orthovisc, Euflexxa, and Hyalgan injections for knee osteoarthritis exempt from NY sales tax?
Yes. Orthovisc, Euflexxa, and Hyalgan are all hyaluronan-based treatments a physician injects into an osteoarthritic knee to supplement the joint's natural fluid, improving the knee's operation and ma…
Are EMS units, orthopedic pillows/cushions, massage devices, mattresses, whirlpool baths, and infrared lamps exempt as medical equipment if sold by prescription?
No. The medical-equipment exemption under Tax Law 1115(a)(3) applies only to equipment that is primarily and customarily used for medical purposes and is not generally useful in the absence of illness…
Are over-the-counter acne products exempt from NY sales tax, and what makes a product an exempt 'acne preparation'?
Yes -- acne preparations that contain a recognized active acne drug are exempt. Tax Law 1115(a)(3) exempts drugs and medicines used to treat illness in humans. An 'acne preparation' qualifies if it co…
Is a kegel pelvic-floor exercise device exempt from NY sales tax as medical equipment?
No. The medical-equipment exemption under Tax Law 1115(a)(3) applies only to equipment that is primarily and customarily used for medical purposes and is not generally useful in the absence of illness…
Are charges for renting inflatable amusement devices and equipment -- with the company's safety staff on site -- subject to NY sales tax?
Yes. Providing inflatable devices (bungee runs, slides, obstacle courses, etc.) and other amusement equipment (jousting, boxing, sumo gear, Segways) for parties is a taxable lease of tangible personal…
Which clinical-trial patient-recruitment services -- ads, call centers, tracking, site kits, translation -- are subject to NY sales tax?
Most are not taxable, but the printed materials are. Producing TV/radio ads and websites, running e-mail and direct-mail advertising campaigns, operating screening call centers, and ad-response tracki…
Are movies a theater receives from studios taxable in NY when delivered by satellite versus on a hard drive?
It depends on the delivery medium. Movies a theater receives by satellite transmission or otherwise delivered electronically are not subject to sales tax -- they're treated as sales of intangible prop…
Is a sweetened chocolate product taxable candy in NY, and does selling through in-state independent reps require registering as a vendor?
The chocolate is taxable, and the reps may trigger registration. A sweetened chocolate product sold in wrapped pieces is candy or confectionery, which is excluded from the food exemption and taxable -…
We're a public benefit corporation created by state law to build office facilities for the UN. Our enabling statute says our 'income and operations' are tax-exempt. If we record a mortgage to finance a new construction project, is that mortgage subject to mortgage recording tax?
Exempt. The petitioner is a public benefit corporation created by a 1968 state statute (later amended in 2011) to coordinate development of office and other facilities near UN Headquarters in New York…
Must a New York gun dealer (FFL) collect sales tax when transferring a firearm the buyer purchased from an out-of-state seller, and is its transfer fee taxable?
No on both. When a New York buyer purchases a gun directly from an out-of-state seller (FFL) and pays that seller, federal law requires the gun to ship to a New York FFL who runs the background check …
New York Advisory Opinion TSB-A-12(4)C / 12(7)S: Does a not-for-profit electricity Independent System Operator become subject to corporate franchise tax or lose its sales-tax exempt status by adopting a central counterparty structure under FERC orders?
No. A not-for-profit Independent System Operator that adopts a central counterparty structure -- becoming a party to all transactions in the electricity markets it administers under FERC orders -- doe…
New York Advisory Opinion TSB-A-12(3)C: Will the Department respect an Empire Zone certificate transferred to a corporation after a stock purchase and name change, and when does its sales-tax benefit period end?
Yes. The Department will respect an Empire Zone certificate of eligibility that the Department of Economic Development transfers to the surviving corporation after a stock purchase and name change (th…
How does NY sales and use tax apply to a stair and railing manufacturer that also installs its products?
As a fabricator that installs its own product, the company is a contractor. Installing or entirely replacing stairs is generally a nontaxable capital improvement, so its charges to sell-and-install st…
Are cardiac ventricular-assist devices, their components, supplies, service, and training exempt from NY sales tax?
Yes, essentially all of it is exempt. The heart devices assist permanently malfunctioning heart ventricles, so they qualify as prosthetic aids and are exempt under Tax Law 1115(a)(4); their external c…
Someone pledges their house as collateral for a bail bond, signing a contingent mortgage that only becomes payable if the bond is forfeited. Is recording that contingent mortgage subject to New York's mortgage recording tax even though no money changes hands unless forfeiture happens?
Yes, mortgage recording tax is due. A bail bond insurance company/agency posts a bond to secure a criminal defendant's release; as collateral, the person putting up the bond (the mortgagor) pledges re…
An LLC acquired a shopping-center site as a nominee/agent for its two members, who are each solely responsible for developing and funding their own separate future condominium unit. Once construction and the condominium declaration are complete, the LLC will distribute each member's designated unit to that member. Is this distribution exempt from New York's Real Estate Transfer Tax as a mere change of form, since each member always had the sole economic interest in its own unit?
Yes, exempt. An LLC ('the Company') acquired a shopping-center site as nominee/agent for its two corporate members, each of which funded the acquisition with its own money and would independently deve…
Are an independent real-estate consultant's services -- analysis, recommendations, and oversight for clients -- subject to NY sales tax?
No. Consulting services aren't among the enumerated services taxed under New York's sales tax. The consultant locates and analyzes properties, builds custom cash-flow projections, makes purchase recom…
New York Advisory Opinion TSB-A-12(2)C: How should an out-of-state company apportion to New York its receipts from educational travel programs, some of which are conducted in New York?
Source them to where the tours happen. A company that runs educational travel programs is selling a service, so its receipts are apportioned to New York based on where the tour is performed: tours con…
Is a subscription to a hosted product-data-synchronization data pool taxable as prewritten software in NY?
Yes. The product is a certified data pool (CDP) that lets supply-chain trading partners upload, synchronize, request, and view standardized product data through the operator's hosted software, which r…
If a professional gambler relocated to New York and continued placing full-time, systematic bets on horse races as his sole livelihood, would that activity count as a trade or business for New York income tax purposes?
Yes. Based on the facts presented - near-daily, high-volume pari-mutuel wagering conducted with a statistical betting model as the petitioner's sole source of livelihood - the Department concluded thi…
Is Synvisc (hylan G-F 20), a knee-osteoarthritis injection, exempt from NY sales tax?
Yes. Synvisc (hylan G-F 20) is a hyaluronan-based fluid a physician injects into an osteoarthritic knee, where it supplements the joint's natural synovial fluid, relieves pain, and restores the knee's…
New York Advisory Opinion TSB-A-12(1)C / 12(2)S: Is a cash payment-processing service subject to sales tax, and does using it make merchants vendors or give them New York franchise-tax nexus?
No on both. A cash payment-processing service that lets customers pay online purchases or bills with cash at a local store is not an enumerated taxable service, so it is not subject to sales and use t…
If a QEZE partnership restructures by inserting two single-member LLCs between itself and its existing owners, without changing who ultimately controls it, will it lose its empire zone tax benefits - and would a later change in the Department's position apply retroactively?
No, the QEZE certification and EZ tax benefits survive. Because inserting two disregarded-entity SMLLCs as intermediate owners doesn't change who ultimately owns, controls, or benefits from the petiti…
Are paid 'membership' dues at an owner-operated public golf course taxable as social or athletic club dues in NY?
No. Tax Law 1105(f)(2) taxes dues paid to a 'social or athletic club,' but this golf course isn't one. The owner retains sole control over the facility and all its operations; the 'members' have no ow…
Are a laser-surgery treatment-card fee and a per-procedure patent-license fee subject to NY sales tax?
Yes, both are taxable. The $10 plastic treatment card that must be inserted to operate the laser is itself tangible personal property with real utility (it activates the equipment), not a mere token o…
Are facial moisturizers and cosmetic makeup that contain an SPF of 2 or greater exempt from NY sales tax?
No. These products -- facial moisturizers and liquid/powder makeup that happen to contain a sun-protection ingredient (SPF 2+) -- are cosmetics, and cosmetics are taxable under Tax Law 1115(a)(3) even…
Are the 10-year installment payments a company makes from its nonqualified deferred compensation plan to two former employees, who are now nonresidents of New York, subject to New York personal income tax and withholding?
No. Because each employee elected to receive Plan distributions as substantially equal annual installments over a 10-year period, the payments qualify as 'retirement income' under 4 U.S.C. § 114(b)(1)…
Is a fixed-price guided Segway tour a taxable rental of tangible property or an exempt tour service in NY?
It's a taxable rental. Tour services aren't an enumerated taxable service, but here the primary thing the customer buys is the right to use the Segway. The customer has physical possession of the Segw…
If you move your domicile out of New York but still own your New York apartment while it's under contract for sale, and you spend more than 183 days in New York that year, are you still taxed as a New York statutory resident?
Not necessarily. New York held that a couple who changed their domicile to Connecticut did not maintain a permanent place of abode in New York because their real estate listing agreement legally barre…
Is a lump-sum charge to operate and manage water and wastewater treatment facilities subject to NY sales tax?
No. The company contracts to fully operate, manage, and maintain water and wastewater treatment plants -- staffing them with state-certified, licensed operators and running the facilities in complianc…
New York Advisory Opinion TSB-A-11(10)C: Is an out-of-state seller of tangible gifts protected from corporate franchise tax by Public Law 86-272 when some orders are filled by unaffiliated New York third-party vendors?
No, it is not subject to franchise tax. A North Carolina company that sells only tangible gifts and awards into New York -- some shipped by unaffiliated New York third-party vendors it never takes tit…
New York Advisory Opinion TSB-A-11(9)C: Can the brownfield redevelopment tax credit be claimed for improvements placed in service before the certificate of completion is issued, if the certificate issues in the same taxable year?
Yes. Under the brownfield redevelopment tax credit (Tax Law section 21), the tangible-property credit can be claimed for improvements placed in service before the certificate of completion is issued, …
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These are official tax letter rulings and advisory opinions issued by New York'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.