Is a sewing (quilting) service performed on a customers quilt subject to New York sales tax?

Plain-English summary

A person performs a sewing service on customers quilts — stitching the layers of a quilt together with a design. She asked whether the service is taxable.

The Office of Counsel concluded it is taxable, on two grounds:

• Fabricating/processing (section 1105(c)(2)): sewing the quilt is producing, fabricating, or processing tangible personal property that the customer furnishes, which is a taxable service.
• Service to property (section 1105(c)(3)): it is also a taxable service to tangible personal property.
• No tailoring exclusion: section 1105(c)(3) excludes tailoring, but tailoring is the alteration of clothing (20 NYCRR 527.5(b)(3)). A quilt is not clothing, so the exclusion does not apply.

Because the service is taxable, she must register for sales tax, collect tax from customers, file returns, and remit the tax.

What this means for you

Sewing, crafting, and finishing businesses

Sewing or finishing work on a customers own goods is generally a taxable fabricating/servicing of tangible personal property. The familiar carve-outs (tailoring, laundering, dry-cleaning, weaving, pressing, shoe repair) are narrow — tailoring only covers altering clothing.

Know which exclusion you actually fit

Work that resembles tailoring (sewing) is not automatically excluded. Quilting, alterations to non-clothing items, and similar work fall outside the exclusion and are taxable. If you do this work, register and collect tax.

Common questions

Q: I just sew — isnt that tailoring, which is exempt?
A: No. Tailoring means altering clothing. A quilt is not clothing, so the tailoring exclusion does not apply and the service is taxable.

Q: Under what provisions is quilting taxable?
A: It is taxable both as fabricating/processing the customers property (section 1105(c)(2)) and as a service to tangible personal property (section 1105(c)(3)).

Q: What do I have to do?
A: Register for sales tax, collect tax from customers, file periodic returns, and remit the tax.

Q: Can I rely on this opinion?
A: It binds the Department only as to the petitioner. Use it as guidance and confirm your own facts.

Citations and references

• Tax Law section 1105(c)(2) (tax on producing/fabricating/processing property furnished by the customer)
• Tax Law section 1105(c)(3) (tax on servicing/repairing tangible personal property; tailoring exclusion)
• 20 NYCRR 527.5(b)(3) (tailoring is alteration of clothing)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_2016.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a16_29s.pdf

Original ruling text

New York State Department of Taxation and Finance

Office of Counsel

TSB-A-16(29)S
Sales Tax
October 14, 2016

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S151105B

The Department of Taxation and Finance (“the Department”) received a Petition for
Advisory Opinion from REDACTEDREDACTEDREDACEDREDACTEDREDACTEDREDA
REDACTED (hereinafter “Petitioner”). Petitioner asks whether sewing services she provides to
customers on quilts are subject to sales tax.
We conclude that the sewing services provided by Petitioner to customers are subject to
sales tax.
Facts
Petitioner performs a sewing service on customers’ quilts. Petitioner sews the layers of a
quilt together with a stitching design.
Analysis
Tax Law Section 1105(c)(2) imposes sales tax on the receipts from every sale, except for
resale, of the service of “producing, fabricating, processing, printing or imprinting tangible
personal property, performed for a person who directly or indirectly furnishes the tangible
personal property, not purchased by him for resale, upon which services are performed.” Section
1105(c)(3) imposes sales tax on the receipts from “installing tangible personal property…or
maintaining, servicing or repairing tangible personal property…not held for sale in the regular
course of business, whether or not the services are performed directly or by means of coinoperated equipment or by any other means, and whether or not any tangible personal property is
transferred in conjunction therewith, except: (ii) any receipts from laundering, dry-cleaning,
tailoring, weaving, pressing, shoe repairing and shoe shining.”
Petitioner provides the service of sewing customers’ quilts. This service is taxable under
Tax Law § 1105(c)(2) because it constitutes the service of “producing, fabricating or processing”
tangible personal property and those services are performed on property (quilts) provided
directly or indirectly by Petitioner’s customers.

-2-

TSB-A-16(29)S
Sales Tax
October 14, 2016

Petitioner’s service is also taxable under Tax Law § 1105(c)(3) as a service to tangible
personal property. While Tax Law § 1105(c)(3)(ii) provides that receipts from tailoring are
excluded from sales tax, that exception is not applicable here. “Tailoring” is the service of
providing alternations to clothing. See 20 NYCRR § 527.5(b)(3). Petitioner is not providing a
tailoring service because she is not sewing or altering clothing. Accordingly, Petitioner’s service
is subject to sales tax under both Tax Law § 1105(c)(2) and (3). Petitioner must register for sales
tax purposes, collect the sales tax from her customers on receipts from this service, file periodic
returns and remit the tax to the Department.

DATED: October 14, 2016

/S/
DEBORAH R. LIEBMAN
Deputy Counsel
NOTE:

An Advisory Opinion is issued at the request of a person or entity. It is limited to the
facts set forth therein and is binding on the Department only with respect to the
person or entity to whom it is issued and only if the person or entity fully and
accurately describes all relevant facts. An Advisory Opinion is based on the law,
regulations, and Department policies in effect as of the date the Opinion is issued or
for the specific time period at issue in the Opinion. The information provided in this
document does not cover every situation and is not intended to replace the law or
change its meaning.