Could a chief warrant officer certify a higher-ranking service member's eligibility for South Carolina's historical military vehicle sales-tax exemption?

Plain-English summary

South Carolina Private Letter Ruling 90-2 held that chief warrant officers in grades W-2 through W-4 were commissioned officers for purposes of the historical military automobile sales-tax exemption.

The exemption required an out-of-state domiciliary or resident stationed in South Carolina under military orders to give the vehicle seller, within ten days, a statement from a commissioned officer of higher rank. The statement certified the buyer's active-duty status and out-of-state domicile or residence.

Because permanent chief warrant officers in grades W-2 through W-4 were appointed by presidential commission, the Commission concluded that they could satisfy the commissioned-officer part of that certificate requirement when higher-ranking than the purchaser.

The historical vehicle exemption

The cited statute exempted sales of automobiles or motor bikes to a person who:

• was domiciled in or a resident of another state;
• was in South Carolina because of U.S. Armed Forces orders; and
• furnished the seller, within ten days of sale or purchase, the required higher-ranking commissioned-officer statement.

The PLR addressed only whether a chief warrant officer could be the certifying commissioned officer. It did not relax the other conditions.

Commissioned and warrant officers

The federal definitions quoted in the ruling said:

• "commissioned officer" included a commissioned warrant officer; and
• "warrant officer" meant a person holding a commission or warrant in a warrant-officer grade.

The Warrant Officer Act provisions then listed chief warrant officer grades W-2, W-3, and W-4 and stated that permanent appointments to those grades were made by presidential commission.

By contrast, the quoted provision said permanent W-1 appointments were made by warrant from the relevant service secretary. The ruling's conclusion was specifically limited to chief warrant officers in W-2 through W-4.

The holding

A chief warrant officer in grade W-2, W-3, or W-4 was a commissioned officer within the historical exemption.

For a valid certificate, that officer still had to be higher in rank than the vehicle purchaser and provide the required active-duty and residency statements within the statutory period.

What this means for you

Historical automobile sales

A certification signed by a qualifying higher-ranking chief warrant officer met the commissioned-officer requirement described in the PLR.

Dealers and service members today

Do not rely on the 1990 exemption text or ten-day process without checking current South Carolina law and forms.

Tax professionals

For a legacy transaction, verify the certifier's warrant grade, relative rank, the buyer's orders and residency, and the delivery date of the statement to the seller.

Common questions

Q: Did every warrant officer count as a commissioned officer?

A: The PLR concluded only that chief warrant officers in grades W-2 through W-4 did.

Q: Was chief warrant officer status by itself enough?

A: No. The certifier also had to be higher-ranking than the purchaser, and the transaction had to meet the exemption's other requirements.

Q: What did the certificate establish?

A: That the purchaser was on active duty and was domiciled in or a resident of another state.

Q: Can another dealer rely on this PLR as precedent?

A: No. Its scope says it applies only to the requesting taxpayer's specific facts and has no precedential value.

Citations and references

• S.C. Code Ann. § 12-35-550(25) — historical military automobile exemption
• S.C. Code Ann. § 12-35-510 — historical sales tax
• 10 U.S.C. § 101(15)-(16) — commissioned and warrant officer definitions quoted in the ruling
• 10 U.S.C. § 555 et seq. — historical warrant officer grades and appointment provisions discussed

Source

• Landing page: https://dor.sc.gov/advisory-opinion-search
• Original PDF: https://dor.sc.gov/sites/dor/files/policies/PLR90-2.pdf

Original ruling text

SC PRIVATE LETTER RULING #90-2

TO:

XYZ Co.

SUBJECT:

Military Exemption - Autos
(Sales and Use)

REFERENCE:

S.C. Code Section 12-35-550(25) (Supp. 1988)
S.C. Code Section 12-35-510 (1976)

AUTHORITY:

S.C. Code Section 12-3-170 (1976)
SC Revenue Procedure #87-3

SCOPE:

A Private Letter Ruling is a temporary document issued to a taxpayer, upon
request, and it applies only to the specific facts or circumstances related in the
request. Private Letter Rulings have no precedential value and are not
intended for general distribution.

Question:
Is a Chief Warrant Officer a commissioned officer, within the meaning of Code Section 12-35550(25)?
Facts:
XYZ Co. sells motor vehicles to, among others, members of the military. Such sales are exempt
from the sales tax, if the requirements of Code Section 12-35-550(25) are met. That section
reads, in part:
The gross proceeds of the sale of automobiles or motor bikes to a person domiciled in or
resident of another state, who is located within South Carolina by reason of orders of the
Armed Forces of the United States [are exempt]....if within ten days of the sale or
purchase a statement is furnished the vendor from a commissioned officer of the Armed
Forces of a higher rank than the purchaser certifying that the person claiming the
exemption is a member of the Armed Forces on active duty and is domiciled in or a
resident of another state. (emphasis added).
Discussion:
The question at hand is: Does a statement furnished by a chief warrant officer satisfy the
requirements of Code Section 12-35-550(25)? More specifically, is a chief warrant officer a
commissioned officer?
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A commissioned officer is one who has been bestowed his or her rank by the President. Also,
the terms "commissioned officer" and "warrant officer" are defined at 10 U.S.C.A., Section
101(15) and (16), in part, as follows:
(15) "Commissioned officer" includes a commissioned warrant officer.
(16) "Warrant officer" means a person who holds a commission or warrant in a warrant
officer grade.
The Warrant Officer Act of 1954, which is embodied in 10 U.S.C.A., Section 555 et seq., reads,
in part:
(a) The regular warrant officer grades in each armed force corresponding to the pay
grades prescribed for warrant officers by section 201(b) of title 37 are as follows:
Warrant officer grade:
Chief warrant officer, W-4
Chief warrant officer, W-3
Chief warrant officer, W-2
Warrant officer, W-1
(b) Permanent appointments of regular warrant officers, W-1, shall be made by warrant
by the Secretary concerned. Pernament appointments of regular chief warrant officers
shall be made by commission by the President.
In summary, a "chief warrant officer" is a warrant officer in pay grades W-2 through W-4; and, is
commissioned by the President.
Conclusion:
Chief Warrant Officers (grades W-2 through W-4) are commissioned officers within the meaning
of Code Section 12-35-550(25).
SOUTH CAROLINA TAX COMMISSION
s/S. Hunter Howard Jr
S. Hunter Howard, Jr., Chairman
s/A. Crawford Clarkson Jr.
A. Crawford Clarkson, Jr., Commissioner
s/T. R. McConnell
T. R. McConnell, Commissioner
Columbia, South Carolina
, 1990
January 10

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