Do long-term rehabilitation and psychiatric care facilities get New York's reduced 0% energy tax rate, and can they claim a refund?

Plain-English summary

Dianne Germany asked two questions about long-term rehabilitation centers (for people with debilitating head or spinal injuries) and long-term psychiatric care facilities (privately owned, similar to a state mental hospital). "Long-term" here means anywhere from 30 days to the rest of the patient's life, and the care includes living facilities and meals — not out-patient care or stays under 30 days.

1. Are these "residential facilities" eligible for the reduced 0% state sales tax rate on energy sources and services under Tax Law § 1105-A?
2. If so, can they get a refund of the state sales tax they paid on energy over the prior three years?

The answer turns on classification. The Department said a facility is "residential in nature" if it falls within the definition of:

• a health-related facility or nursing home — Public Health Law § 2801(2)–(3), DOH Reg. § 414.1(a)(1) and (3); or
• a community residence, supervised living facility, supportive living facility, residential treatment facility for children and youth, or residential care center for adults — Mental Hygiene Law § 1.03(28), (28-a), (28-b), (33), (36);

and the facility is registered with the NYS Department of Social Services or Department of Mental Hygiene (the same registration test used for nontaxable hotel occupancy under § 527.9).

If residential in nature:

• Energy purchases get the 0% rate on the statewide portion of the tax (§ 1105-A; § 527.13). However, local sales tax still applies — § 1105-A does not reduce the local (Article 29) or New York City rates.
• The facility may claim a refund of the state sales tax (statewide portion only) paid on qualifying energy during the three years before the refund claim is filed.

If NOT residential — including any facility that meets the definition of a "hospital" (Public Health Law § 2801(1), DOH Reg. § 414.1(a)(2), or Mental Hygiene Law § 1.03(10)):

• No reduced 0% rate.
• But if the facility holds (or obtains) § 1116(a)(4) exempt-organization status, its energy purchases — except diesel motor fuel used for heating — may be exempt from both state and local tax.

Diesel heating fuel for a § 1116(a)(4) exempt organization has its own history: exempt with Form ST-119.1 before Sept. 1, 1988; pay-then-refund (Form FT-1009) from Sept. 1, 1988 through July 4, 1989; and, effective July 5, 1989, purchasable exempt for the organization's own heating use with Form FT-1020 (or FT-1025 for enhanced diesel over 4,500 gallons), so long as the fuel goes into a storage tank not equipped to fuel a motor vehicle.

Finally, energy bought by the State of New York or its agencies/political subdivisions is exempt from state and local tax under § 1116(a)(1) with a governmental purchase order.

What this means for you

The "residential vs. hospital" line is decisive

Two similar-looking care facilities can get opposite treatment. If yours qualifies as a health-related facility, nursing home, or one of the listed Mental Hygiene Law residences — and is registered with DSS or DMH — it can reach the 0% state energy rate. If it instead meets the statutory definition of a hospital, it doesn't, no matter how long patients stay. Pin down which regulatory definition your facility actually fits (and confirm the registration) before claiming the rate.

The 0% rate is state-only — you still pay local tax

A common trap: § 1105-A zeroes out only the statewide portion. Local county/city sales taxes (and NYC's rate) continue to apply to your energy purchases even when the facility qualifies. Budget and refund claims should separate the state portion from the local portion.

Exempt-organization status is the alternate route

If your facility can't get the residential rate, § 1116(a)(4) exempt status is the other path — and it's broader, reaching both state and local tax on energy, with the notable exception of heating diesel motor fuel, which follows its own rules and forms. A facility can also recover tax paid before its exempt status was recognized, subject to a three-year limit — but not if it had to amend its documents or change operations to qualify (in that case, only purchases after the change count).

Common questions

Q: Does a long-term rehab or psychiatric facility automatically get the 0% energy rate?
A: No. It must be "residential in nature" — fitting a health-related facility / nursing home / listed Mental Hygiene Law residence definition and registered with DSS or DMH. Facilities meeting the "hospital" definition do not qualify.

Q: If we qualify, is all our energy tax eliminated?
A: Only the statewide portion goes to 0%. Local sales taxes still apply. You can also claim a refund of the state portion paid in the prior three years.

Q: We're a hospital, so we can't use § 1105-A. Any other relief?
A: If you hold § 1116(a)(4) exempt-organization status, your energy purchases can be exempt from state and local tax — except diesel motor fuel used for heating, which has separate rules and forms.

Citations and references

Statutes and regulations:

• Tax Law § 1105-A — reduced 0% state rate on energy sources/services used for residential purposes
• Tax Law § 1116(a)(1) — government purchases exempt (with purchase order)
• Tax Law § 1116(a)(4) — charitable/educational exempt organizations
• 20 NYCRR § 527.13 — reduced energy rate; does not apply to local (Article 29) or NYC taxes
• 20 NYCRR § 527.9(e)(2) — facilities providing special care (registered with DSS/DMH) not treated as hotels
• Public Health Law § 2801 — definitions of hospital, nursing home, residential health care facility
• Department of Health Reg. § 414.1 — definitions of health-related facility, hospital, nursing home
• Mental Hygiene Law § 1.03 — definitions of facility, hospital, community residence, and related residences

Forms referenced: ST-119.1, FT-1009, FT-1020, FT-1025 (diesel heating-fuel exemption/refund)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_1990.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a90_60s.pdf

Original ruling text

New York State Department of Taxation and Finance

Taxpayer Services Division
Technical Services Bureau

TSB-A-90(60)S
Sales Tax
December 19, 1990

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S900816B

On August 16, 1990 a Petition for Advisory Opinion was received from Dianne Germany,
611 Canyon Ridge Drive, Euless, Texas 76040.
The issues raised by Petitioner, Dianne Germany, are:
1.
Whether long-term rehabilitation centers and long-term psychiatric care facilities are
considered to be residential facilities for purposes of the sales tax exemption applicable to purchases
of certain energy sources and services as provided under Section 1105-A of the Tax Law?
2.
Whether if the rehabilitation centers and psychiatric care facilities are considered to
be residential facilities for sales tax purposes, are they entitled to a refund of the New York State
sales tax paid on purchases of those ceratin energy sources and services during the appropriate three
year period immediately preceding the filing date of the claim for refund submitted by or on behalf
of such centers or facilities?
A long-term rehabilitation center is a facility wherein a person with a debilitating injury (such
as head or spinal) might go for extensive physical therapy and constant care.
A long-term psychiatric care facility is a facility which caters to patients needing constant
care and mental rehabilitation. Such facility would be similar to a state mental hospital, except it
would be privately or corporately owned.
In either type of facility, "long-term" is considered to be anywhere from thirty days to the rest
of the patient's life. The care at either facility includes living facilities, meals, etc. Such care does not
include out-patient care or a stay of less than thirty days.
Section 1105-A of the Tax Law states, in part:
Reduced tax rate on certain energy sources and services.-­
(a) Notwithstanding any other provisions of this article, but not for purposes of the
taxes imposed by section eleven hundred seven or eleven hundred eight or authorized
pursuant to the authority of article twenty-nine of this chapter, the taxes imposed by
subdivision (a) or (b) of section eleven hundred five on the receipts from the retail
sale of fuel oil and coal for residential purposes; the receipts from the retail sale of
wood used for residential heating purposes; and the receipts from every sale, other
than for resale, of propane (except when sold in containers of less than one hundred
pounds), natural gas, electricity, steam and gas, electric and steam services used for
TP-9 (9/88)

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residential purposes shall be paid at the rate of zero percent on and after October first,
nineteen hundred eighty. The provisions of this subsection shall not apply to a sale
of (i) diesel motor fuel which involves a delivery at a filling station or into a
repository which is equipped with a hose or other apparatus by which fuel can be
dispensed into the fuel tank of a motor vehicle and (ii) enhanced diesel motor fuel
except in the case of a sale of such enhanced diesel motor fuel used exclusively for
residential purposes which is delivered into a storage tank which is not equipped with
a hose or other apparatus by which such fuel can be dispensed into the fuel tank of
a motor vehicle and such storage tank is attached to the heating unit burning such
fuel, provided that each delivery of such fuel of over four thousand five hundred
gallons shall be evidenced by a certificate signed by the purchaser stating that the
product will be used exclusively for residential purposes.
Section 527.13 of the Sales and Use Tax Regulations states, in part:
Certain energy sources and services. [Tax Law, §1105-A]
(a) Reduction in rate. (1) Section 1105-A of the Tax Law provides for a reduction in
the four-percent statewide sales tax rate imposed under sections 1105(a) and 1105(b)
of the Tax Law and in the four-percent statewide compensating use tax rate imposed
under section 1110(a) of the Tax Law,. . .on the receipts from every sale, other than
for resale, used for residential purposes of:
(i) fuel oil (except diesel motor fuel);
(ii) coal;
(iii) wood (for heating purposes only);
(iv) propane (except when sold in containers of less than 100 pounds);
(v) natural gas;
(vi) electricity;
(vii) steam; and
(viii) gas, electric and steam services.
For purposes of this regulation, the term energy sources is used to describe the above
mentioned tangible personal property and services.
(2) The reduction in the sales and compensating use tax rates does not apply to those tax
rates imposed by localities pursuant to article 29 of the Tax Law, nor to the four-percent sales
and compensating use tax rate in New York City. . .
(d) Definitions. (1) The term residential purposes means any use of a structure or
part of a structure as a place of abode, maintained by or for a person, whether or not
owned by such person, on other than a temporary or transient basis with the exclusion
of accommodations subject to tax under subdivision (e) of section 1105 of the Tax
Law.

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(2) The term nonresidential purposes means any use other than for residential
purposes, as defined in paragraph (1) of this subdivision, including any use in the
conduct of a trade, business or profession, whether such trade business or profession
is carried on by the owner of the structure or some other person.
Section 1116 of the Tax Law states, in part:
Exempt organizations.-­
(a) Except as otherwise provided in this section, any sale or amusement charge by
or to any of the following or any use or occupancy by any of the following shall not
be subject to the sales and compensating use taxes imposed under this article:
(1) The State of New York, or any of its agencies, instrumentalities, public
corporations. . .or political subdivisions where it is the purchaser, user or consumer,
or where it is a vendor of services or property of a kind not ordinarily sold by private
persons;. . .
(4) Any corporation, association, trust, or community chest, fund or foundation,
organized and operated exclusively for religious, charitable, scientific testing for
public safety, literary or educational purposes. . . or for the prevention of cruelty to
children. . ., no part of the net earnings of which inures to the benefit of any private
shareholder or individual, no substantial part of the activities of which is carrying on
propaganda, or otherwise attempting to influence legislation, (except as otherwise
provided in subsection (h) of section five hundred one of the United States internal
revenue code of nineteen hundred fifty-four as amended), and which does not
participate in, or intervene in (including the publishing or distributing of statements),
any political campaign on behalf of any candidate for public office;. . .
Section 527.9 of the Sales and Use Tax Regulations states, in part:
Hotel occupancy. [Tax Law, §1105(e)]
(e) Nontaxable occupancy. The following occupancies are not subject to tax on hotel
occupancy.
(2) nursing homes, rest homes, convalescent homes, maternity homes for expectant
mothers, residences or homes for adults or retardates. When such facilities registered
with the New York State Department of Social Services or Department of Mental
Hygiene, whether publicly or privately owned and operated, accept as patients
persons who require special care on account of age, illness, mental or physical
condition or the like, and provide this special care either by nurses, orderlies or aides,
they are deemed not to be hotels with respect to such patients.
Example 1:

A senior citizen's lodging facility which only furnishes hotel facilities
and services and does not furnish services or special care provided by
attendants, etc., is a hotel.

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Example 2:

A maternity residence for expectant unwed mothers which is
registered with the State Department of Social Services provides care
and service for mothers-to-be. Such care and service includes
maintaining a residence, social services, medical care, and arranging
for delivery at a local hospital. This facility is not subject to the tax
on occupancy.

Section 2801 of the Public Health Law states, in part:
Definitions
The following words or phrases, as used in this article, shall have the following
meanings, unless the context otherwise requires:

1. "Hospital" means a facility or institution engaged principally in providing
   services by or under the supervision of a physician or, in the case of a dental clinic
   or dental dispensary, of a dentist, for the prevention, diagnosis or treatment of human
   disease, pain, injury, deformity or physical condition, including, but not limited to,
   a general hospital, public health center, diagnostic center, treatment center, dental
   clinic, dental dispensary, rehabilitation center other than a facility used solely for
   vocational rehabilitation, nursing home, tuberculosis hospital, chronic disease
   hospital, maternity hospital, lying-in-asylum, out-patient department, out-patient
   lodge, dispensary and a laboratory or central service facility serving one or more such
   institutions, but the term hospital shall not include an institution, sanitarium or other
   facility engaged principally in providing services for the prevention, diagnosis or
   treatment of mental disability and which is subject to the powers of visitation,
   examination, inspection and investigation of the department of mental hygiene except
   for those distinct parts of such a facility which provide hospital service. The
   provisions of this article shall not apply to a facility or institution engaged principally
   in providing services by or under the supervision of the bona fide members and
   adherents of a recognized religious organization whose teachings include reliance on
   spiritual means through prayer alone for healing in the practice of the religion of such
   organization and where services are provided in accordance with those teachings.
2. "Nursing home" means a facility providing therein nursing care to sick,
   invalid, infirm, disabled or convalescent persons in addition to lodging and board or
   health related service, or any combination of the foregoing, and in addition thereto,
   providing nursing care and health-related service, or either of them, to persons who
   are not occupants of the facility.
3. "Residential health care facility" means a nursing home or a facility
   providing health-related service.
   Section 414.1 of the Department of Health Regulations states, in part:
   Definitions. (a) Except for Article 2, the following definitions of medical facilities,

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based on standards approved by the commissioner, shall apply to this Subchapter
unless the context otherwise requires:
(1) Health-related facility shall mean a facility, institution, intermediate care facility,
or a separate or distinct part thereof, providing therein lodging, board and social and
physical care, including but not limited to the recording of health information, dietary
supervision and supervised hygienic services incident to such care to six or more
residents not related to the operator by marriage or by blood within the third degree
of consanguinity.
(2) Hospital shall mean an institution with beds for one or more inpatients not
related to the operator which is primarily engaged in providing services and facilities
to inpatients by or under the supervision of a physician, and which meets the
following requirements:
(i) provides diagnostic and therapeutic services for medical diagnosis, treatment and
care of injured and sick persons and has, as a minimum, laboratory and radiology
services and organized departments of medicine and surgery;
(ii) has an organized medical staff which may include, in addition to doctors of
medicine, doctors of osteopathy and dentistry;
(iii) has bylaws, rules and regulations pertaining to standards of medical care and
service rendered by its medical staff;
(iv) maintains medical records for all patients;
(v) has a requirement that every patient be under the care of a member of the medical
staff;
(vi) provides 24-hour patient service;
(vii) has in effect a written, currently applicable utilization review plan, acceptable
to the department, which provides for utilization review studies designed to evaluate
the appropriateness of admissions to the hospital, lengths of stay, discharge practices,
use of medical and hospital services and all related factors which may contribute to
the efficient provision of hospital and physician services; and
(viii) has in effect agreements with a home health agency for referral and transfer of
patients to home health agency care when such service is appropriate to meet the
patient's requirements.
(3) Nursing home shall mean a facility, institution, or portion thereof, providing
therein by or under the supervision of a physician, nursing care and other health,
health-related, and social services as specified in this Subchapter for 24 or more
consecutive hours to three or more nursing home patients who are not related to the
operator by marriage or by blood within the third degree of consanguinity, including,

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but not limited to, an infirmary section which is identifiable as a nursing home unit in a
special area, wing or separate building of a public or voluntary home or of a general or
special hospital.
(8) A health-related facility resident shall mean a person, who because of social, physical,
developmental or mental condition, requires institutional care and services above the level
of room and board in order to secure basic services necessary to function, but who does not
require the inpatient care and services provided by a hospital or skilled nursing facility and,
in addition, may have one or more but is not limited to the following characteristics:
(i) possesses a degree of functional capacity permitting varied degrees of
independence that reflect chronic disease conditions which may be stabilized, or
mental and emotional impairment requiring medications and a range of care and
services which stress health and social maintenance and prevention of further
deterioration;
(ii) whose stay in the health-related facility is usually long-term and whose
admission, which is not for social reasons along (sic), reflect the absence of alternate
community, family or personal resources to meet the individual's needs;
(iii) needs a planned program of care and supervision on a continuous 24-hour-a-day
basis emphasizing personal care and services under the direction of a physician;
(iv) needs assistance in securing planned, basic recreational and diversional activities
and services of other disciplines such as nutritional and social work counseling,
through coordinated resident care plans which also include sustaining contacts with
the community and which support the need and desire to function as independently
as possible and prevent withdrawal and other symptoms of early deterioration;
(v) needs health services which are under the direct supervision of a registered nurse
or other health professionals who have responsibility for developing and coordinating
nursing care and resident care plans and who periodically review and revise such
plans;
(vi) needs periodic or intermittent skilled nursing care and services but not
continuous skilled services which in the aggregate require the direct supervision by
licensed nursing personnel; and
(vii) requires services which can usually be delivered by nonlicensed personnel and
are primarily support kinds of services such as assistance with activities of daily
living.
(11) Nursing home patient shall mean a person:
(i) diagnosed by a physician as having one or more clinically determined illnesses
or conditions that cause the person to be so incapacitated, sick, invalid, infirm,

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disabled or convalescent as to require at least medical and nursing care; and
(ii) whose assessed health care needs in the professional judgment of his physician
or a medical team:
(a) do not require care or active treatment of the patient in a general or special
hospital in or near his community;
(b) cannot be met satisfactorily in the person's own home or home substitute through
providing such home health services, including medical and other health and health-­
related services as are available in or near his community; and
(c) cannot be met satisfactorily in a physician's office, hospital clinic or other
ambulatory care setting because of the unavailability of medical and other health and
health-related services for the person in such setting in or near his community.
Section 1.03 of the Mental Hygiene Law states, in part:
Definitions
When used in this chapter, unless otherwise expressly stated or unless the context
otherwise requires:

6. "Facility" means any place in which services for the mentally disabled are
   provided and includes but is not limited to a psychiatric center, developmental center,
   institute, clinic, ward, institution, or building, except that in the case of a hospital as
   defined in article twenty-eight of the public health law it shall mean only a ward,
   wing, unit, or part thereof which is operated for the purpose of providing services for
   the mentally disabled. It shall not include a place where the services rendered consist
   solely of non-residential services for the mentally disabled which are exempt from
   the requirement for an operating certificate under article sixteen or thirty-one of this
   chapter, nor shall it include domestic care and comfort to a person in the home.
7. "Hospital" means the in-patient services of a psychiatric center under the
   jurisdiction of the office of mental health or other psychiatric in-patient facility in the
   department, a psychiatric in-patient facility maintained by a political subdivision of
   the state for the care or treatment of the mentally ill, a ward, wing, unit or other part
   of a hospital, as defined in article twenty-eight of the public health law, operated as
   a part of such hospital for the purpose of providing services for the mentally ill
   pursuant to an operating certificate issued by the commissioner of mental health, or
   other facility providing in-patient care or treatment of the mentally ill which has been
   issued an operating certificate by such commissioner.

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28. "Community residence" means any facility operated by or subject to licensure
    by the office of mental health or the office of mental retardation and developmental
    disabilities which provides a supervised residence or residential respite services for
    mentally disabled persons and a homelike environment and room, board and
    responsible supervision for the habilitation or rehabilitation of mentally disabled
    persons as part of an overall service delivery system. A community residence shall
    include an intermediate care facility with fourteen or fewer residents that has been
    approved pursuant to law, and a community residential facility as that term is used
    in section 41.36 of this chapter. Such term does not include family care hotels.
    28-a. "Supervised living facility" means a community residence providing
    responsible supervisory staff on-site twenty-four hours per day for the purpose of
    enabling residents to live as independently as possible.
    28-b. "Supportive living facility" means a community residence providing practice
    in independent living under supervision but not providing staff on-site on a twenty-­
    four hour per day basis.
29. "Residential treatment facility for children and youth" shall mean an inpatient
    psychiatric facility which provides active treatment under the direction of a physician
    for individuals who are under twenty-one years of age, provided that a person who,
    during the course of treatment attains the age of twenty-one may continue to receive
    services in a residential treatment facility for children and youth until he or she
    reaches the age of twenty-two. The term "residential treatment facility for children
    and youth" does not apply to the children's psychiatric centers described in Section
    7.17 of this chapter or to facilities specifically licensed by the office of mental health
    as children's hospitals. Residential treatment facilities for children and youth are a
    sub-class of the class of facilities defined to be "hospitals" in subdivision ten of this
    section.
30. "Residential care center for adults" means a facility which provides long term
    residential care and support services to mentally ill adults, provides case management
    and medication management services, and assists residents in securing clinical,
    vocational and social services necessary to enable the resident to live in the
    community. No residential care center for adults established after September first,
    nineteen hundred eighty-six shall have more than one hundred fifty residents. A
    residential care center for adults is not an adult care facility subject to licensure by
    the department of social services nor is it an inpatient treatment facility.
    Accordingly, in any instance where a long-term rehabilitation center or long-term psychiatric
    care facility falls within the definition of a health-related facility or nursing home as defined under
    Section 2801.2 or 2801.3 of the Public Health Law and Section 414.1(a)(l) and (3) of the Department
    of Health Regulations, respectively, or a community residence, supervised living facility, supportive
    living facility, residential treatment facility for children and youth or residential care center for adults
    as defined under Section 1.03 28, 28-a, 28-b, 33, and 36, respectively, of the Mental Hygiene Law
    and is registered with the New York State Department of Social Services or Department of Mental

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Hygiene, as similarly required when determining nontaxable occupancy under Section 527.9 of the
Sales and Use Tax Regulations, such facilities will be considered to be residential in nature.
Therefore, if such facilities are residential in nature, purchases of energy sources and services for use
in such facilities will be subject to the reduced rate of zero percent as provided under Section 1105-A
of the Tax Law and Section 527.13 of the Sales and Use Tax Regulations for purposes of computing
the statewide portion of the sales tax due on such purchases. However, such facilities will be subject
to any local sales tax imposed on purchases of energy sources or services.
If such facilities are residential for the purposes of Section 1105-A of the Tax Law, such
facilities will be entitled to a refund of the New York State sales tax (statewide portion only) paid
on purchases of applicable energy sources and services during the appropriate three year period
immediately preceding the filing date of the claim for refund submitted by or on behalf of such
facilities.
Conversely, in any instance where the facilities at issue are not residential in nature or where
the facilities fall within the definition of hospital as defined under Section 2801.1 of the Public
Health Law and Section 414.1(a)(12) of the Department of Health Regulations or Section 1.03 10
of the Mental Hygiene Law and as such are determined to not be residential in nature, such facilities
will not be entitled to the reduced rate of zero percent provided under Section 1105-A of the Tax
Law. However, if any of the facilities at issue, applies for or has applied for and is granted or has
been granted exempt organization status pursuant to the provisions of section 1116(a)(4) of the Tax
Law, purchases of energy sources and services for use by such facility, with the exception of
purchases of diesel motor fuel used for heating purposes, may be exempt from the statewide tax and
any applicable local tax.
Due to several recent legislative changes, the sales tax status of purchases of diesel motor fuel
for use as heating oil for nonresidential purchases by an organization which has been granted exempt
organization status pursuant to the provisions of section 1116(a)(4) of the Tax Law is as follows:
1)

Prior to September 1, 1988, purchases of diesel motor fuel for nonresidential heating
use were exempt from the retail sales and use tax, provided the exempt organization
furnished the supplier a properly completed form ST-119.1, Exempt Organization
Certification.

2)

For the period September 1, 1988 through July 4, 1989, exempt organizations could
no longer issue form ST-119.1, Exempt Organization Certification to their suppliers
when making purchases of heating oil. Instead, they were required to pay the
applicable local sales tax on purchases of heating oil for residential heating and both
the state and applicable local sales tax on purchases of fuel for nonresidential heating
purposes. However, the exempt organizations were subsequently entitled to a refund
of the sales tax paid. The exempt organizations could claim a refund of the sales tax
paid by filing Form FT-1009, Application for Refund of Sales Tax on Diesel Motor
Fuel Purchased at Retail with the Department of Taxation and Finance within three
years of the date the tax was paid.

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3)

Effective July 5, 1989 organizations which have been granted exempt organization
status pursuant to the provisions of section 1116(a)(4) of the Tax Law may purchase
diesel motor fuel for their own heating use exempt from the sales and use tax.
In order to be deemed exempt from tax, the fuel must be delivered into a storage tank
which is not equipped with a device capable of dispensing the fuel into a motor
vehicle.
The fuel must be ordered, received and paid for directly by an organization which is
exempt according to the provisions of section 1116(a)(4) of the Tax Law. The
exempt organization must furnish the seller of the fuel a properly completed form
FT-1020, Exemption Certificate for Certain Taxes Imposed on Diesel Motor Fuel and
Propane, such form being issued either as a single-purchase exemption certificate or
as a blanket exemption certificate. Where the exempt organization purchases more
than 4500 gallons of enhanced diesel fuel at one time for heating use, form 1025,
Certificate for Exemption from Certain Taxes Imposed on Diesel Motor Fuel, a
single-purchase exemption certificate only, must be issued to the seller.

An organization that establishes its exempt status pursuant to the provisions of section
1116(a)(4) of the Tax Law may be entitled to a refund of sales tax it has previously paid subject to
a three year statute of limitations.
Taxes paid before exempt status is recognized are refundable if the organization met the
requirements for exemption when the purchases were made. However, an organization that is
required to amend its documents or change its operations in order to qualify for exemption is not
entitled to a refund of taxes paid before the effective date of those changes.
In any instance where the purchase use or consumption of energy services or sources,
including heating oil is by the State of New York or any of its agencies, instrumentalities, public
corporations or political subdivisions, the purchase of such energy service or source including
heating oil, will be exempt from state and local tax pursuant to the provisions of Section 1116(a)(1)
of the Tax Law provided the supplier is presented a governmental purchase order.

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Requests for exemption certificates or refund applications may be made by telephone from
within New York State by calling 1-800-462-8100 or from outside New York State by calling 1-518­
438-1073. Written requests should be mailed to NYS Tax Department, Taxpayer Assistance Bureau,
W.A. Harriman Campus, Albany, N.Y. 12227.

DATED: December 19, 1990

PAUL B. COBURN
Deputy Director
Taxpayer Services Division

NOTE: The opinions expressed in Advisory Opinions
are limited to the facts set forth therein.