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.
No Texas rulings match these filters
Try a different search term or clear the filters.
Did the Texas Historical Commission have to collect sales tax on historical-marker plaques posted beside highways or on buildings?
No. Because the sales-tax law did not define 'writings,' the Comptroller treated the Commission's historical-marker plaques as exempt writings under § 151.312.
Was a bookseller's separately labeled postage-and-handling charge subject to Texas sales tax?
Yes. Texas said the seller properly taxed the full bill, including the P&H charge, because the narrow third-party U.S. postage exclusion did not apply.
Which vehicle services were taxable: inspections, insurance-purpose appraisals, other appraisals, breakdown coverage, or roadside repairs?
Separately stated inspections and noninsurance appraisals were not taxable; insurance-purpose appraisals were taxable. Repair parts were taxable, but repair labor was not.
Could airlines buying Texas debt-collection services claim multistate-purchaser treatment with exemption certificates?
Yes, but the airlines had to issue exemption certificates and accrue the proper Texas tax; the provider's requested refunds required verification first.
How did Texas tax laundromat vending sales, coin-operated washers and dryers, drop-off laundry, and vending commissions?
Accessible vending sales and drop-off laundry were taxable; coin-operated washer/dryer receipts and commissions from inaccessible machines were not.
How did Texas source state and local sales tax for conference-calling services and long-distance calling-card calls?
Texas taxed conference bridging performed in Texas regardless of billing address. Calling-card tax depended on actual call origin, destination, and Texas billing or service facts.
Could a utility credit an electricity sales-tax refund to the customer's account instead of paying the refund directly?
Yes, but only with the customer's written consent to apply the sales-tax refund as an account credit rather than issue a refund.
When does a required or suggested donation become a taxable sale or admission charge in Texas?
A mandatory payment normally became taxable when the value received was commensurate with it, although an exemption could still apply to the transaction.
Did assigning a computer purchase to a leasing company remove the customer's Texas sales-tax liability if the customer had already used the computer?
No. If the customer used the computer before assigning the purchase order to the leasing company, the customer owed tax on the computer purchase.
Was the sale of a blood autotransfuser to a Texas hospital taxable when the hospital used it in patient care?
Yes. The hospital was the consumer of taxable patient-care items, so the equipment sale was taxable unless the hospital supplied a valid exemption certificate.
Could a registered engineer's signature and seal replace the purchaser's signature on a predominant-use utility exemption certificate?
No. The engineer certified the study, but the purchaser still had to sign. An agent could sign with specific power of attorney, subject to the utility's acceptance.
Was upholstery labor included in the taxable sales price when a company bought chair frames, hired another company to upholster them, and sold completed chairs?
Yes. Texas said tax applied to the completed chair's full sales price, including upholstery labor whether or not separately stated; resale certificates could cover inputs.
Did Texas treat apartment and nursing-home common areas as residential real property, and was new-construction labor taxable?
Yes, the listed properties and their common-area improvements were residential. Separately stated materials were taxable, but new-construction labor was not.
Did the occasional-sale exemption cover a Texas manufacturer selling an aircraft used for employee transportation and charter activity?
No. Texas said the aircraft was a general-business-purpose asset, and the manufacturer was not selling the business's entire operating assets.
When could restaurants sell meals tax-free to government employees or religious, charitable, and educational organizations?
Only when the exempt entity or its authorized agent made and directly paid for a qualifying purchase with valid documentation. Official travel alone did not exempt an employee's meal.
What documentation did a natural-gas seller need for predominant-use exemptions or gas delivered through a Texas pipeline interconnect for out-of-state use?
The seller needed valid exemption documents or collected tax. For out-of-state transport, pipeline contracts or invoices naming the foreign delivery point could prove export.
Could corporations transfer business assets into a new partnership, or sell an undivided interest for cash, without Texas sales tax?
Potentially. No-consideration contributions were not sales, and joint-ownership transfers could be exempt if prior tax and bona fide-contract conditions were met.
Did transferring land to a contractor count as payment, and did the customer owe sales tax on a lump-sum geodesic-dome construction contract?
The land was consideration equal to the credit received, but the customer owed no tax on the lump-sum new-construction contract; the contractor owed tax on materials.
Did a Texas outdoor-play company have to collect sales tax when it sold vouchers that could later be exchanged for assigned-seat tickets?
No. The vouchers were not admission documents, so tax was collected only when customers exchanged them for actual play tickets.
Was a monthly apartment-locator package taxable when it included updated pricing information, a computer, laser disc, and software?
Yes. Texas taxed the full monthly charge as an information service and allowed the provider to buy customer-controlled equipment and software for resale.
Which charges in a Texas modeling package were taxable when it included photo preparation, a session, a portfolio, and directory placement?
The preparation, photo session, and portfolio package were taxable in full. A separately stated charge for directory placement was not taxable.
Did a January 1990 contract avoid later Texas state and Amarillo sales-tax increases when it passed present and future taxes to the customer?
No. The contract's tax pass-through clause made the customer responsible for present and future taxes, so the prior-contract exemption did not apply.
When a Texas vendor rebuilds a customer's motor-vehicle part and returns that same part, is the full charge taxable?
No. Returning the same rebuilt part to the same customer was a repair: labor was not taxable, while materials followed separated- or lump-sum-contract rules.
Were connection, PBX-capacity, repair, and building-wiring jobs performed for a Texas telecommunications provider taxable?
Yes. All listed functions were taxable, but resold connection service could be covered by a resale certificate; PBX and building work could not.
How did Texas apply sales tax to lump-sum and separated contracts for drilling and equipping a new water or irrigation well?
For lump-sum work, the contractor paid tax on inputs and charged no tax to the customer; separated contracts taxed materials but not labor, subject to exemption.
Were the seller's various post-surgical support garments exempt from Texas sales tax as braces?
Yes. After examining the submitted product information, Texas said every listed support garment met Rule 3.284's definition of a brace and qualified for exemption.
Did a separately stated federal luxury tax on taxable jewelry or fur become part of the amount subject to Texas sales tax?
No. Texas said the federal luxury tax was excluded from the taxable sales price when separately stated and identified on the customer invoice.
Could an exempt university buy telephone lines for fire-safety hookups in university-owned fraternity houses without paying sales tax?
Yes. Texas said the exempt university could give the telephone company an exemption certificate instead of paying tax on the fire-safety telephone lines.
Were recurring Texas rental charges for returnable gas cylinders taxable when the cylinders were supplied with gas?
No. The later cylinder-rental charges were not taxable, but the gas charge was taxable unless the customer bought the contents for resale.
Were private telecommunications circuits used to control petroleum pipeline pumping stations exempt from Texas sales tax?
No. Texas said pipeline-control telecommunications were taxable, except that long-distance communications originating outside Texas were exempt.
Could a commercial tenant claim a Texas electricity exemption or refund when its landlord bought the utility and billed reimbursement under the lease?
No. Texas treated the landlord as using the utility commercially in leasing property, not reselling electricity to the tenant.
Was physician-prescribed or physician-dispensed methadone exempt, and how were dispensing bottles and prior tax payments treated?
Methadone was exempt when prescribed or dispensed by a physician. Prescription containers sold with it were exempt, while bottles used for drugs not sold were taxable.
Were mini Dopplers exempt therapeutic appliances, or taxable diagnostic devices?
They were taxable diagnostic devices. Texas expressly corrected its December 1990 letter, which had wrongly treated mini Dopplers as exempt therapeutic appliances.
Was a checkout surcharge used to recover junk-automobile waste-handling costs subject to Texas sales tax?
The surcharge followed the item sold: it was taxable on a taxable sale, but not taxable when the underlying sale was exempt as a resale.
Did a high-volume diskette duplicating machine used to copy computer programs qualify for Texas's 1991 manufacturing-equipment refund?
Yes. Because the machine manufactured computer programs sold as tangible personal property, it qualified for the 25% refund available for tax paid on the 1990 purchase.
Were remote-terminal services taxable data processing when the provider's main computer processed client data but output printed at the client's site?
Yes. Both arrangements were taxable data processing, and the Comptroller said their total charges were taxable even though reports printed at the client's site.
Did paint and coatings used against corrosion qualify for Texas's manufacturing refund or phase-in exemption?
They qualified on processing machinery or as legally required pollution control, but not on nonqualifying piping or equipment; application labor did not qualify.
Were historical books exempt when a nonprofit society distributed books published by others, and how did Texas tax work on registered historic buildings?
The books were taxable because the society had not both published and distributed them; specified historic-building labor was exempt, but materials were taxable.
How did Texas tax lump-sum vehicle repairs, separated repairs, vehicle remodeling, and work on movable specialized equipment?
Lump-sum vehicle repairs were not taxed to the customer, separated repairs taxed incorporated parts, and all vehicle-remodeling or specialized-equipment charges were taxable.
Did a doctor's prescription make a computer exempt from Texas sales tax as medical equipment?
No. The computer did not qualify as exempt medical equipment even with a doctor's prescription; the Comptroller did not decide the software issue.
Did paving machines qualify for Texas's 25% sales-tax refund for manufacturing equipment when customers used them on roads and parking lots?
No. The machines were contractor equipment used to improve or repair real property, not qualifying manufacturing equipment, so the 25% refund was unavailable.
How did Texas tax a prison construction contract for the Federal Bureau of Prisons on city-owned land leased to the federal government?
Texas treated it as a federal contract: no tax was charged on materials incorporated into the realty, but the contractor owed tax on equipment used to build it.
Were payments taxable when an equipment-financing arrangement was labeled a lease for accounting purposes but operated as a loan?
No. Because the financing party never received or conveyed title or possession, the Comptroller treated the arrangement as a loan, not a taxable lease.
Were charges for an interstate private-line data system subject to Texas state and local sales tax when no channel terminated in Texas?
State sales tax applied, but local city, county, and transit taxes did not apply because the circuit qualified as interstate long-distance service.
When did tenant finish-out work count as new construction rather than taxable remodeling of Texas real property?
Initial finish-out of a true shell was new construction, but changing space after flooring, walls, or a ceiling had been installed was taxable remodeling.
How did Texas sales tax apply to long-distance service, separately stated 911 surcharges, federal excise tax, and municipal franchise fees?
Tax applied to specified long-distance service and municipal franchise fees, but not to separately stated 911 surcharges or federal excise tax.
Was a Texas fee for providing managers who trained and directed a facility's own housekeeping and laundry employees taxable?
No. The management fee was not taxable, but the management company owed sales or use tax on taxable items it used to provide the service.
Were accelerated monitoring-service charges taxable when a burglar-alarm customer terminated the contract early?
Yes. The customer had agreed to pay for the taxable monitoring term even after ending service, and tax timing followed the provider's accounting method.
Were monthly subscriptions and per-lead charges for faxed trade-lead information subject to Texas state and local sales tax?
Yes for Texas customers: both charges were taxable. No Texas tax was collected when the information was faxed to customers outside Texas.
Were guided educational river trips in Texas taxable even when they taught customers about river geology and botany?
Yes. Guided river trips were taxable amusement services; the rule's specific guide-service exemption covered hunting and fishing, not river trips.
Which charges at an indoor fitness and play center were taxable amusement services, and was a tumbling-style class exempt?
Passes, club cards, group trips, parties, games, food, and merchandise were taxable; the creative-movement class was exempt sport instruction.
Did using personal computers and diskettes change whether an advertising agency's preliminary and finished artwork was taxable?
No. The work and client approval controlled: preliminary art was nontaxable, finished art was taxable, and the transfer medium did not decide the result.
How could a computer lessor recover Texas sales tax paid to the prior owner of a supplier business on computers bought for leasing?
The purchaser could seek a refund or an assignment of the seller's refund right, or claim a return credit; local-tax credits required matching jurisdictions.
Were refrigeration units bought separately and attached to trailers after the vehicle sale subject to motor-vehicle tax or limited sales and use tax?
They were subject to limited sales and use tax, not motor-vehicle tax, because the accessories were separately purchased and attached after the trailer sale.
Were installation, software, and communication charges taxable when sold with a Texas information service?
Yes. The Comptroller treated all three charges as part of the taxable information service whether billed separately or as one lump sum.
Were charges for guided tours of a choose-and-cut Christmas tree farm subject to Texas sales tax?
Yes. The Comptroller treated the guided tours as taxable because they were not primarily educational, although an exempt organization could buy admission for its members with an exemption certificate.
Could an association obtain a Texas sales-tax refund for monthly publications prepared and mailed to members by an outside publisher?
No. The Comptroller treated the association as the publisher rather than a purchaser of publications, so the referenced court case did not produce a refund.
Did an aircraft modified and used for aerial photography qualify for Texas's manufacturing-equipment exemption?
No. The Comptroller treated the aircraft as support equipment because it was not used directly to manufacture a photograph.
Could a retailer claim a Texas sales-tax bad-debt credit for an estimated loss when it sold installment receivables without recourse?
No. An estimated bad-debt allowance did not identify the customers who would default; relief required a qualifying actual bad debt, such as a recourse account returned after default.
How did Texas local sales taxes apply to residential and commercial natural-gas and electricity use, and to exemption certificates?
Commercial utility use was taxable and residential use was generally exempt for special-purpose districts, but a city could tax residential use if it retained or reimposed that tax.
Browse Texas rulings by topic
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.