Is a service of hanging a client's own artwork on the wall subject to New York sales tax?

Plain-English summary

A business installs client-owned artwork — it locates a client's pictures, mirrors, tapestries, or similar items and hangs them on the wall. It doesn't sell the art, doesn't alter it, and the installation isn't permanent (the art can be relocated easily, needing only minor patching of nail holes). It asked whether this service is taxable.

The Office of Counsel said yes. Sales tax applies to the enumerated service of installing tangible personal property, "whether or not any tangible personal property is transferred in connection with the installation" (Tax Law § 1105(c)(3)). The regulations define installing as "the setting up of tangible personal property or putting it in place for use" (20 NYCRR 527.5(a)(2)), and tangible personal property includes artistic items such as sketches and paintings (20 NYCRR 526.8(a)(3)). Hanging the artwork puts it in place for use, so the receipts are subject to sales tax — even though the client already owns the art and the installation is temporary.

What this means for you

Art installers, picture hangers, and home/office stagers

Charging to hang or set up a customer's pictures, mirrors, or tapestries is a taxable installation service. The fact that the customer already owns the items and you sell no product doesn't change that — installation alone is enough.

"It's not permanent" doesn't help

A temporary, easily removable hang is still "installing." (Contrast a true capital improvement to real property, which is treated differently — but ordinary picture-hanging isn't that.)

Accountants

This is a clean § 1105(c)(3) result: receipts for installing tangible personal property are taxable regardless of whether property is transferred.

Common questions

Q: The client owns the art and I just hang it — why is that taxable? A: Because installing tangible personal property is itself a taxable service under § 1105(c)(3), even when no property is sold.

Q: It's only hung temporarily and comes down easily. Still taxable? A: Yes. Putting the item in place for use is "installing," whether or not it's permanent.

Q: Is artwork really 'tangible personal property'?
A: Yes — the regulations specifically list artistic items such as sketches and paintings.

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 § 1105 (services subject to sales tax)
• Tax Law § 1105(c)(3) (taxable service of installing tangible personal property)
• 20 NYCRR 527.5(a)(2) (definition of installing)
• 20 NYCRR 526.8(a)(3) (tangible personal property includes artistic items such as sketches and paintings)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales-ao-2020.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a20-60s.pdf

Original ruling text

New York State Department of Taxation and Finance
Office of Counsel

TSB-A-20(60)S
Sales Tax
November 3, 2020

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION
The Department of Taxation and Finance received a Petition for Advisory Opinion from
[ REDACTED ] (“Petitioner”). Petitioner asks whether artwork installation services are subject to New York State and/or local sales tax. We conclude that such services are subject to sales tax as the installation of tangible personal property. Facts Petitioner provides a service of installing client-owned artwork (pictures, mirrors, tapestries, or similar items). Petitioner does not sell the artwork; instead, it locates client owned artwork and hangs it on the client’s wall. Petitioner performs no alterations to the artwork. The installation is not permanent nor intended to be permanent. Furthermore, the artwork can be easily relocated and requires only minor patching of nail holes to repair any damage caused by the installation. Analysis Sales tax is imposed on certain enumerated services. See Tax Law § 1105. The installation of tangible personal property is a taxable service, whether or not any tangible personal property is transferred in connection with the installation. See Tax Law § 1105(c)(3). Tax regulations define “installing” as the setting up of tangible personal property or putting it in place for use. See 20 NYCRR 527.5(a)(2). Tangible personal property includes artistic items such a sketches and paintings. See 20 NYCRR 526.8(a)(3). Petitioner’s installation of the artwork falls under the definition of installing tangible personal property since Petitioner sets up the artwork or puts it in place for use by hanging it on the client’s wall. Therefore, Petitioner’s receipts from the installation of client-owned artwork are subject to sales tax. See Tax Law § 1105(c)(3). DATED: November 3, 2020
/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.