NY TSB-A-24(40)S Sales Tax 2024-08-21

Is a service that disassembles, removes, and disposes of a company's used office furniture during a move or remodel subject to New York sales tax?

Short answer: Yes. Disassembling, removing, and disposing of used office furniture from a New York building is taxable as maintaining/servicing real property under Tax Law § 1105(c)(5). Trash and garbage removal is taxable real-property maintenance, and pickup-transport-disposal is treated as one integrated service, so the entire single fee is taxable — even the disassembly and light-demolition portions.

Disclaimer: This is an official New York State Department of Taxation and Finance Advisory Opinion (TSB-A), issued by the Office of Counsel at a taxpayer's request. It is limited to the facts set forth in it and binds the Department only with respect to the petitioner to whom it was issued, and only if that petitioner fully and accurately described all relevant facts; another taxpayer cannot rely on it. It reflects the law, regulations, and Department policy in effect when issued and may since have changed. Taxpayer-identifying details are redacted. New York State and local sales taxes are administered centrally by the Department. This summary is informational only and is not legal or tax advice. Consult a licensed New York tax professional about your specific 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 at the bottom of this page, or PDF in the sidebar) is the authoritative source for any reliance.

View original ruling (PDF)

Plain-English summary

A company offers a service that disassembles, removes, and disposes of used office furniture for businesses that are moving or remodeling. It uses its own equipment and trailers to take the furniture away and dispose of it, does light demolition when needed to detach fixtures, and hauls off the debris. It charges one fee based on square footage and the number of trailers required, and it disposes of all the furniture it removes. The company asked whether this is taxable. The Department concluded yes — the whole service is taxable as maintaining/servicing real property under Tax Law § 1105(c)(5).

New York taxes the service of maintaining, servicing, or repairing real property (Tax Law § 1105(c)(5)), which covers all activities that keep real property in a condition of fitness, efficiency, readiness, or safety (20 NYCRR 527.7(a)). Crucially, trash and garbage removal — from inside or outside a building — is specifically treated as taxable real-property maintenance (20 NYCRR 527.7(b)(2)). And picking up, transporting, and disposing of refuse is an integrated service that can't be split into separate taxable and nontaxable parts (Cecos Int'l and Penfold). So the entire receipt — disassembly, light demolition, removal, hauling, and disposal — is taxable when the property is in New York.

This is an important contrast with simply moving furniture. In TSB-A-24(20)S, labor-only, in-premises furniture moving (relocating furniture, not removing/disposing of it) was not taxable, because moving tangible personal property isn't an enumerated service. The difference here is disposal: once the job is removing and getting rid of the furniture, it's trash/garbage removal — a taxable real-property maintenance service — and the disassembly that's part of that integrated job is taxed too.

What this means for you

Junk-removal, office-cleanout, and demolition-debris haulers

If your service removes and disposes of furniture, equipment, or debris from a New York building, treat the entire charge as taxable real-property maintenance under § 1105(c)(5). You can't carve out the disassembly, loading, or transport as separate nontaxable labor — pickup-transport-disposal is one integrated, taxable service. Charge sales tax on the full fee, sourced to where the property is located.

Movers vs. disposers — know which one you are

The tax answer flips on what happens to the furniture:
- Moving/relocating furniture (it stays the customer's property, just repositioned or transported) — generally not taxable; moving TPP isn't an enumerated service (TSB-A-24(20)S).
- Removing and disposing of furniture (trash/garbage removal) — taxable real-property maintenance (this opinion).
If you do both, look at the true object of the job. A cleanout that ends in disposal is taxable even if it involves moving items first.

Don't separately state your way out of it

Because disposal is an integrated service, breaking the invoice into "disassembly," "labor," "transport," and "dumping" lines won't make those pieces nontaxable. The whole receipt for the integrated removal-and-disposal service is taxable.

Accountants and tax professionals

This applies § 1105(c)(5) and 20 NYCRR 527.7(a)/(b)(2) (trash/garbage removal as taxable real-property maintenance), reinforced by the integrated-service holdings in Matter of Cecos Int'l v. State Tax Comm'n, 71 NY2d 934 (1988), and Matter of Penfold v. State Tax Comm'n, 114 AD2d 696 (1985). Pair it with TSB-A-24(20)S to advise clients on the move-vs-dispose distinction.

Common questions

Q: Is hauling away and disposing of old office furniture taxable in New York?
A: Yes. It's taxable as maintaining/servicing real property under Tax Law § 1105(c)(5); trash and garbage removal is taxable real-property maintenance (20 NYCRR 527.7(b)(2)).

Q: Can I separately state the disassembly or transport so it isn't taxed?
A: No. Pickup, transport, and disposal of refuse is an integrated service (Cecos, Penfold); the entire single fee is taxable.

Q: Isn't moving furniture nontaxable?
A: Moving/relocating furniture (without disposal) generally isn't taxable (TSB-A-24(20)S). This is different — the service removes and disposes of the furniture, which is taxable trash removal.

Q: What if the furniture is removed from a building outside New York?
A: The opinion conditions taxability on the real property being located in New York State. Sourcing follows where the property/job is.

Q: Can I rely on this opinion?
A: No. An Advisory Opinion binds the Department only as to the petitioner and the facts presented. It illustrates the Department's reasoning but cannot be relied on by another taxpayer.

Citations and references

Statutes and regulations:
- Tax Law § 1105(c)(5) (sales tax on maintaining, servicing, or repairing real property)
- 20 NYCRR 527.7(a) (scope — keeping real property in a condition of fitness, efficiency, readiness, or safety)
- 20 NYCRR 527.7(b)(2) (trash/garbage removal, inside or outside a building, is taxable real-property maintenance)

Authority and related opinions: Matter of Cecos Int'l, Inc. v. State Tax Comm'n, 71 NY2d 934 (1988); Matter of Penfold v. State Tax Comm'n, 114 AD2d 696 (1985) (integrated refuse service); compare TSB-A-24(20)S (labor-only furniture moving — not taxable).

Source

Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao.htm
Opinion: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales/24-40s.htm
Printer-friendly PDF: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a24-40s.pdf

Original ruling text

Sales Tax
August 21, 2024
Office of Counsel

The Department of Taxation and Finance received a Petition for Advisory Opinion from [ redacted ] (Petitioner). Petitioner asks if the disassembly, removal and disposal of used office furniture for companies that are moving or remodeling is subject to sales tax.

We conclude that Petitioner’s service is subject to sales tax as a real property maintenance service under Tax Law §1105(c)(5).

Facts

One of the services Petitioner provides is the disassembly, removal and disposal of used office furniture for companies that are moving or remodeling. Petitioner uses its own equipment and trailers to remove, transport and dispose of the furniture. Petitioner will do light demolition, if necessary, to remove attached fixtures and will dispose of debris. Petitioner charges a customer a single fee, which is determined by the square footage and the number of trailers needed to dispose of the furniture. Petitioner disposes of all of the customer’s furniture that it removes.

Analysis

Tax Law §1105(c)(5) imposes sales tax on maintaining, servicing or repairing real property. Maintaining, servicing and repairing covers all activities that relate to keeping real property in a condition of fitness, efficiency, readiness or safety or restoring it to such condition. See 20 NYCRR 527.7(a). The services of trash or garbage removal, whether from inside or outside of a building, are considered to be taxable as the service of maintaining and servicing real property. See 20 NYCRR 527.7(b)(2). The service of picking up, transporting and disposing refuse has been held to be an integrated service that cannot be separated into discrete components. See Matter of Cecos Int’l, Inc. v. State Tax Comm’n, 71 NY2d 934 (1988); Matter of Penfold v. State Tax Comm’n, 114 AD2d 696 (3d Dep’t 1985). Thus, Petitioner’s entire receipt for its furniture disassembly, removal and disposal service is subject to tax if the real property from which the furniture is removed is located within this State.

DATED: August 21, 2024

Mary Ellen Ladouceur
Principal Attorney

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.