Texas State Tax Rulings
Free plain-English summaries of state tax letter rulings and advisory opinions issued in Texas, with full citations and the original source on every page.
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Could a foreign retailer buy auto parts tax-free in Texas for resale in El Salvador using a Texas resale certificate?
No. The buyer could avoid tax if the supplier shipped the parts abroad, or pay tax on Texas pickup and seek a refund after giving the supplier proof of export.
Were pill boxes used for free medicine samples and slides used in laboratory analysis exempt from Texas sales tax?
No. Both were taxable when purchased: the container exemption required the contained product to be sold, and laboratory supplies were not within the health-care exemption.
Could a club buy landscaping and repair services tax-free when maintaining a municipal park under contract with a city?
Yes. Services for the city-owned park were exempt when identified on an exemption certificate; any refund had to come from the provider to the entity that paid the tax.
Were charges for adding local contact information to a network video feed and for recording a satellite program taxable in Texas?
The tagging charge was not taxable when information was added to a network feed, but the charge for videotaping a satellite program was taxable.
Who had to collect and remit Texas sales tax on janitorial services performed by franchisees?
The franchisor. The Comptroller treated it as the retailer and required it to hold a permit and collect and remit all tax due on franchisee services.
Were services to collect delinquent real-property rent and medical bills subject to Texas sales tax?
Yes. Although rent and medical services were not taxable, activities performed to collect or adjust those past-due debts were taxable debt-collection services.
Could a newsletter publisher buy film, film processing, and desktop publishing services for resale without Texas sales tax?
No. Those inputs were not transferred into the subscribers' care, custody, and control, so they did not qualify as purchases for resale under Rule 3.342(e).
Was a magazine with mostly free one-year subscriptions a controlled-circulation publication, and what Texas tax applied?
No. The paid subscriptions showed the magazine was published for subscription sale; paid subscriptions were not taxable, but the publisher owed tax on free copies mailed to Texas subscribers.
Would a church lose the Texas exemption for its centennial history book by hiring an outside professional printer?
No. The church still qualified if it published and distributed the book; using an unaffiliated professional printer did not defeat the exemption.
Was flexlight used as a printing plate exempt from Texas sales tax when a printer manufactured products for sale?
Yes. It was necessary and essential to manufacturing and was neither machinery nor equipment under Rule 3.300(a), so the six-month useful-life test did not apply.
Did Texas exempt labor to repair real-property pollution-control equipment, and what refund applied to replacement wastewater piping?
No exemption applied to real-property repair labor. Pipe bought in 1990 or 1991 qualified for a 25% state-tax refund, but removal and replacement labor did not if the system was an improvement to real…
Was a Network WATS subscription fee excluded from Texas sales tax because it was separately named and was not a local-access or equipment charge?
No. Telecommunications services were taxable items, so the total charge was taxable unless a component had its own exemption; renaming the charge did not exempt it.
Were freelance photographer charges to a Texas video production company taxable, and did camera ownership or an exempt client change the result?
Motion-picture or video-camera work was nontaxable, but still-camera work was taxable. Camera ownership and producing the master for an exempt entity did not change the result.
Did the Texas residential-use exemption cover electricity and natural gas for a mental hospital where patients stayed 30 to 90 days?
No. Rule 3.295's residential-use exemption did not apply to health-care facilities, and the patients' 30-to-90-day stays did not make the hospital a residence.
Did common ownership exempt motor-vehicle and equipment leases between sister corporations from Texas tax?
No. The intercorporate-services exemption did not cover those leases; motor vehicles and financed equipment followed their ordinary tax rules despite common ownership.
Which Texas charges for computer consulting, data processing, custom programming, and software modification were taxable?
Standalone consulting and qualifying custom programming were nontaxable, but data processing and software sales were taxable; lumping taxable and unrelated services made the full charge taxable.
Was equipment temporarily assembled in Texas before shipment for use solely in Oklahoma subject to Texas sales or use tax?
It depended on origin. Out-of-state equipment could qualify for the temporary-storage use-tax exclusion, but equipment shipped from within Texas remained subject to sales tax.
Was a charge to paint pictures on a person's face subject to Texas sales tax?
No. The face-painting charge was not taxable, but the provider had to pay sales tax on all supplies used to paint customers' faces.
Were trolley fares subject to Texas sales tax when the trolley provided public transportation or an amusement ride?
Public-street transportation fares were not taxable, but operating on private property as an amusement ride or providing tour guides was a taxable amusement service.
How did Texas tax discount-travel memberships, amusement components, travel certificates, and promotional giveaways?
Discount memberships and qualifying travel certificates were not taxable, but amusement components and the promoter's printed certificates and giveaways were taxed under different rules.
Was installing or changing an artificial-lift system on a Texas oil well taxable?
The first installation was nontaxable, but changing or converting an existing well from one artificial-lift method to another was taxable remodeling.
Could a homeowners association use Texas's prior-contract exemption for trash service it purchased and separately billed to members?
No for the separately billed trash service. The HOA was the seller, had to buy for resale, and could not use the prior-contract exemption for that purchase.
Could a company using a thirteen-period fiscal calendar file Texas sales-tax returns on that accounting cycle?
It could use its fiscal calendar only by mapping the periods into 12 calendar-month returns, observing the fixed due dates, and leaving preprinted report-period dates unchanged.
Did Texas sales tax apply when a dissolving partnership distributed equipment to its partners, who contributed it to wholly owned professional associations?
No. Neither transfer involved consideration, so neither was a sale; no additional tax was due after tax had been paid on the original purchases.
Could a cellular provider buy a flat-fee call-forwarding roaming feature tax-free for resale when it bundled the feature into taxable service?
Yes. Because the roaming feature was provided as part of the telecommunications service sold to each customer, the provider could issue a resale certificate.
Was labor to operate another company's machine and perforate that company's vinyl sheeting taxable in Texas?
Yes. The work was taxable processing of tangible personal property, unless the vinyl owner resold the material and issued a valid resale certificate.
Could sales tax be refunded on natural gas used by an apartment-complex boiler to provide residential hot water?
Yes. State, city, and MTA tax paid within the limitations period could be refunded based on the stated residential-only use.
When could a Texas seller accept a resale or exemption certificate in good faith, and could the purchaser invoke good faith when issuing it?
The purchaser could not invoke good faith. A seller needed a timely, facially valid certificate and no knowledge that the claimed resale or exemption was improper.
Could restaurants buy disposable paper placemats tax-free with a Texas resale certificate?
Yes. Nonreusable placemats furnished to customers could be purchased for resale whether they were plain, decorative, or carried advertising.
Did Texas's agricultural exemption apply to machinery and equipment used by an original-producer shrimp farm?
Yes under the 1991 letter. STAR warns that a 2011 law later required a Comptroller registration number for certain agricultural and timber exemptions.
Was construction for a private golf-course lessee exempt because the city owned the land and would receive the building when the lease ended?
No. The contractor's customer was the nonexempt lessee, which had sole use and benefit during the lease, so ordinary separated- or lump-sum contract rules applied.
Did a registered massage therapist or the hotel where the therapist worked have to collect Texas sales tax on massage services in 1991?
No. As of February 1, 1991, neither the registered therapist nor the hotel had to collect tax on the massage services described.
Were charges for proprietary telephone-survey results taxable as Texas information services?
No. The work was an information service, but the customer charge was nontaxable because the information was proprietary; the provider still paid tax on taxable inputs.
How could a customer seek a Texas sales-tax refund after taking possession in Texas and exporting the goods to Canada?
The customer needed Canadian customs entry documents and purchase receipts showing import within 30 days, then had to request a refund from each merchant.
Did a city have to collect Texas tax when it repaired sidewalks or drive approaches and billed residential or commercial property owners?
Treatment depended on the property and right-of-way. Accepted city rights-of-way were exempt; private residential lump sums were not collected, while private commercial work was taxable.
How did Texas classify 900-number access, cellular and messaging services, online information, modem services, and merchandise sold through a 900 number?
The letter classified each offering by service type; 900-number access was telecommunications, and the provider also had to collect tax on taxable merchandise sold through the number.
Could a customs cartman who was not a licensed U.S. Customs Broker certify Texas sales-tax exports to Mexico?
No. The cartman could not certify the export, but could document it by returning a Mexican customs pedimento de importaciones to the customer.
Were copyrighted-image license fees, image-research fees, image lists, catalogs, and transportation charges taxable in Texas?
The reproduction license and COMPANY X's own-inventory research fee were nontaxable, but third-party image lists were taxable information and sold catalogs were taxable property.
Was natural gas used to heat chicken houses exempt from Texas sales tax, and could the operator obtain a refund for prior billing periods?
Potentially. Gas used to raise chickens for sale or produce eggs was exempt agricultural use, but other meter uses required a predominant-use study and the Comptroller requested more facts before deci…
Was labor to repair or remodel a tenant-only laundry room in an apartment complex subject to Texas sales tax?
No. A laundry room limited to tenants and guests was residential real property, so repair-and-remodeling labor was not taxable; the requester could pursue refunds for tax paid to contractors.
Were geophysical services using seismic-data processing taxable Texas data-processing services?
Not when professional geophysical interpretation was provided and data processing was only a tool. Pure data manipulation without analysis or professional evaluation was taxable data processing.
How did Texas tax auto-alarm installation and window tinting for vehicles, commercial buildings, residences, and new structures?
Auto alarms and commercial-building tinting were taxable. Vehicle tinting and residential or new-structure tinting depended on lump-sum versus separated billing, with labor not taxed in the described …
Were a nonlicensed company's real-time video transmissions for Texas television stations exempt as broadcasts by licensed stations?
No. The company sold taxable telecommunications services and had to collect tax because it was not itself a licensed or regulated commercial television station covered by the broadcast exemption.
When did a yearbook seller or school have to collect Texas sales tax on yearbooks bought for students?
Tax depended on who bought and resold the books. Exempt schools could buy qualifying books tax-free, but student payments and school resales generally were taxable except for the letter's limited one-…
Could a teacher buy classroom supplies with personal funds without paying Texas sales tax if the school reimbursed the purchase?
No. The teacher had to pay sales tax even if reimbursed and even if the items were used only in class; the public school could instead make the purchase directly under its exemption.
Did a Texas hotel owe tax when it gave guests complimentary coffee, champagne, candy, or flowers?
Unprepared coffee carried no use tax when given free, but the hotel owed tax on the cost of taxable champagne, candy, and unbilled flowers; separately billed flowers were taxed to the guest.
How did Texas tax commercial air-conditioning contracts combining scheduled maintenance, parts, and repairs?
A maintenance-only lump sum was nontaxable, but separately billed repairs were taxable. A mixed lump sum was taxable unless repairs were 5% or less or a documented repair allocation was used.
Which parts of a new narrow-gauge railroad project qualified for Texas's rolling-stock and train-supplies sales-tax exemption?
The engine, tender, passenger cars, and materials incorporated into the operating track were exempt, but station and maintenance-facility materials and other nonessential construction were taxable.
Did a Texas seller need a separate exemption certificate when a government agency supplied an official purchase order or state voucher?
No separate certificate was required when the official purchase order or state voucher supplied the necessary exemption information, but the seller still had to keep supporting documentation.
Was Texas sales tax due when a mover disassembled, transported, and reassembled an existing portable hot tub?
No. Because the company only moved the existing tub and did not sell, remodel, repair, or permanently install it, its disassembly, transportation, and reassembly charges were nontaxable.
Did a registered self-employed massage therapist have to collect Texas sales tax after February 1, 1991?
No. The Rule 3.317 change ended tax collection on registered massage services as of February 1, 1991; a therapist with no other taxable sales also did not need a sales-tax permit.
How did Texas tax sales of recyclable cardboard and a hauler's fee for taking the cardboard to a dealer when the hauler and customer shared sale proceeds?
The cardboard sale was taxable unless supported by a resale or manufacturing exemption certificate, but the $75 hauling fee was nontaxable transportation tied to the property sale.
How did Texas separate new construction from remodeling when a project added four floors and expanded an existing building?
Work in the added footage was new construction, while changes to the existing structure were remodeling. A mixed lump sum was fully taxable if remodeling exceeded 5% unless separately stated.
Could a licensed customs broker use a power of attorney to obtain merchant refunds and pay Texas sales tax directly to Mexican customers at export?
No. The broker could document the export, but the purchaser had to present that documentation to the seller for the refund, and a cash refund required the seller to obtain the purchaser's signed recei…
How did Texas tax motor-vehicle service contracts, repairs performed under them, and customer deductibles?
The vehicle service contract itself was not taxed. Lump-sum covered repairs were nontaxable, while separately stated parts were taxable; a deductible reduced the balance paid by the underwriter.
Was an equipment lessor's reimbursement for property tax subject to Texas sales tax when billed to the lessee?
Not when separately stated from the equipment lease price. If the property-tax amount was included in the lease price, sales tax applied to the total charge.
Could a Mexican farmer use Texas's agricultural exemption certificate to buy qualifying veterinary supplies tax-free?
Yes. The letter applied the same qualifying agricultural-item exemption to Mexican and Texas farmers; taxable purchases could instead use the export-and-refund procedure.
Were Texas oilfield vacuum, fluid, pumping, and well-maintenance services always subject to the same sales-tax treatment?
No. The primary purpose of each job controlled. Vacuum removal for transport or disposal was listed as exempt from limited sales tax, while many equipment-cleaning and repair jobs were taxable.
Was satellite-based positioning equipment exempt when bolted or welded onto commercial oil-and-gas vessels?
Yes. The equipment became an exempt component part when bolted or welded to a vessel used in a commercial enterprise.
Was electricity used to make metal frames exempt when the business both sold frames over the counter and installed frames into real property?
Only partly. Electricity used for frames sold as tangible property was exempt; use for frames incorporated into real property was taxable and had to be allocated by equipment hours.
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These are official tax letter rulings and advisory opinions issued by Texas's revenue authority in response to questions from specific taxpayers about how the tax law applies to their facts. A ruling is binding on the department only for the taxpayer who requested it and cannot be relied on by anyone else, but it is strong evidence of how the state reads the law. Every ruling above has a plain-English question and short answer, plus a link to the full original source.