Is hauling leftover nonrecyclable trash away from a recycling plant a taxable trash-removal service?

Plain-English summary

Island Recycling Corp. operates a recycling plant that accepts construction debris, demolition debris, and other solid waste from carting and trucking companies. It sorts out the reusable materials -- steel, copper, other metals, cardboard, paper, and glass -- and sells those to companies that recycle them into new products. The leftover, nonrecyclable trash is then hauled away by various trucking companies to a landfill. Island Recycling asked whether that final hauling step -- moving the nonrecyclable leftovers off its property -- is a taxable service.

New York taxes "maintaining, servicing or repairing real property," and its own regulation specifically lists "trash and garbage removal" as an example of a taxable real-property maintenance service. The Department found this is a straightforward application of that rule: hauling the nonrecyclable trash off Island Recycling's property is ordinary trash removal, taxable the same way it would be if it were hauled away from any other business or residence. The fact that the trash originated inside a recycling operation, and was separated out after some materials were already recovered for resale, doesn't change the analysis -- the taxable trash-removal service applies to waste transfer stations and recycling plants just like any other real property site.

What this means for you

Recycling companies, waste transfer stations, and similar facilities

Don't assume trash hauled off your site escapes tax just because your business is fundamentally about diverting waste from landfills. The removal of whatever's left after recycling/recovery is ordinary taxable trash and garbage removal, the same as at any other property.

Hauling and trucking companies serving recycling facilities

If you're paid to haul nonrecyclable leftovers away from a client's recycling plant, that charge is a taxable real-property maintenance service under Tax Law § 1105(c)(5), just as it would be hauling trash from an office building or a construction site.

Accountants and tax professionals

This opinion cites Paper Fibres Corporation (TSB-A-97(32)S) and confirms trash removal taxability doesn't turn on the type of real property site (waste transfer station, recycling plant, or ordinary premises) -- a useful, short precedent for any waste-management or recycling-industry client questioning whether their industry gets special tax treatment for this specific service.

Common questions

Q: Does it matter that the trash came from a recycling plant rather than an ordinary business?
A: No -- the Department explicitly noted this doesn't change the analysis; trash removal from a recycling plant is taxed the same as trash removal from any other real property.

Q: Is the sale of the recovered/reusable materials (steel, copper, cardboard, glass) also addressed by this ruling?
A: No -- this ruling addresses only the hauling of the leftover nonrecyclable trash, not the taxability of Island Recycling's sales of recovered materials to other companies.

Q: Would the answer differ if the recycling company hauled the trash itself instead of hiring another company?
A: This ruling doesn't distinguish based on who performs the hauling; the taxable service is the removal itself, whether performed in-house or by an outside hauling company.

Citations and references

Statutes and regulations:

• Tax Law § 1105(c)(5) (maintaining, servicing, or repairing real property)
• 20 NYCRR § 527.7(a) (maintaining, servicing, and repairing real property; trash and garbage removal)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_1998.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a98_84s.pdf

Original ruling text

New York State Department of Taxation and Finance

Taxpayer Services Division
Technical Services Bureau

TSB-A-98(84)S
Sales Tax
December 2, 1998

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S981006A

On October 6, 1998, the Department of Taxation and Finance received a Petition for
Advisory Opinion from Island Recycling Corp., 228 Blydenburg Road, Central Islip, New York,
11779.
The issue raised by Petitioner, Island Recycling Corp., is whether the hauling of
nonrecyclable material which is done exclusively from a recycling plant is a service subject to sales
tax.
Petitioner submits the following facts as the basis for this Advisory Opinion.
Petitioner owns and operates a recycling plant where it accepts construction debris,
demolition debris and other types of solid waste materials. Carting and trucking companies pay
Petitioner to dispose of their solid waste materials. Petitioner separates the reusable materials such
as steel, copper, metals, cardboard, paper and glass. Petitioner then sells such reusable materials to
companies that can recycle the materials into new products. The remainder of the solid waste
materials (the nonrecyclable trash) is then transported to a landfill by various hauling companies.
Applicable Law and Regulations
Section 1105 of the Tax Law provides in part:
On and after June first, nineteen hundred seventy-one, there is hereby
imposed and there shall be paid a tax of four percent upon:
*

*

*

(5) Maintaining, servicing or repairing real property, property or land, as such
terms are defined in the real property tax law, whether the services are performed in
or outside of a building...
Section 527.7(a) of the Sales and Use Tax Regulations provides, in part:
(1) Maintaining, servicing and repairing are terms which are used to cover all
activities that relate to keeping real property in a condition of fitness, efficiency,
readiness or safety or restoring it to such condition. Among the services included are
services on a building itself such as painting; services to the grounds, such as lawn

-2­
TSB-A-98(84)S
Sales Tax
December 2, 1998

services, tree removal and spraying; trash and garbage removal and sewerage service
and snow removal.
Opinion
Petitioner accepts construction debris, demolition debris, and other solid waste materials and
separates such materials into two categories: one, consisting of items of value, e.g., steel, copper,
metals, cardboard, paper and glass and the other, nonrecyclable trash. In accordance with Section
1105(c)(5) of the Tax Law and Section 527.7(a) of the Sales and Use Tax Regulations, the service
of removal and transportation of the nonrecyclable trash from Petitioner's recycling plant is subject
to sales tax as it constitutes a trash and garbage removal service. This conclusion is not altered by
the fact that the nonrecyclable trash is hauled from the yard of the recycling plant. Taxable trash
removal services may be performed with respect to waste transfer stations or recycling plants, as well
as any other real property site. (See Paper Fibres Corporation, Adv Op Comm T&F, May 27, 1997,
TSB-A-97(32)S.)

DATED: December 2, 1998

NOTE:

/s/
John W. Bartlett
Deputy Director
Technical Services Bureau

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