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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When was parking-lot striping or restriping taxable repair rather than nontaxable scheduled maintenance, residential work, or new construction?
Regularly scheduled restriping performed before deterioration could qualify as nontaxable maintenance with records. Restriping after fading or cracking was taxable repair; new-construction and residen…
Were automobile window etching and the associated theft warranty taxable when the warranty was mandatory versus optional?
Window etching was taxable. If the etching could not be bought without the warranty, the full charge was taxable; if the warranty was optional, the warranty charge was not taxable.
Could a nonprofit country club obtain a state refund of tax collected on nontaxable initiation and membership fees before returning or crediting the tax to members?
No. The club first had to refund each purchaser or, with the purchaser's permission, credit the purchaser's account and obtain written acknowledgment that the amount was a sales-tax refund. Only then …
Could a transfer of business assets through a financing lease qualify as an occasional sale?
Yes. Financing leases were treated as sales, so using a financing lease did not prevent a transaction that otherwise met the occasional-sale requirements from qualifying for exemption.
How did Texas tax access fees, calls, private lines, equipment, and other telecommunications charges between Texas and Mexican facilities?
Texas taxed services originating in Texas and billed to a Texas billing or service address, including related access fees; Mexico-origin calls were not taxable, while Texas-origin calls were. Private …
Could affiliated businesses continue filing Texas sales-tax returns using thirteen 4-4-5 fiscal periods, and how were return months and due dates assigned?
Yes. Periods ending on days 1–10 were reported on the prior month's return due the 20th of that month; periods ending on day 11 or later were reported for that month and due the next month's 20th. Pre…
What export documents supported a Texas sales-tax refund, and how did the 30-day Texas storage presumption apply?
A broker export certificate or bill of lading proved export; an air waybill should include the seller's invoice number to identify the goods. The seller collected tax when the customer took Texas poss…
How were manufacturer and extended-warranty roof repairs taxed when commercial roofing warranties crossed Texas's January 1, 1988 real-property repair-law change?
Manufacturer-warranty repairs on sold roofing material supported resale treatment for third-party repair labor. Extended commercial-roof warranties required period-by-period treatment: pre-1988 repair…
Could a nonresidential sub-repairman issue a resale certificate using the general repairman's sales-tax permit number?
No. Each separate legal entity selling taxable items or services needed its own active permit and valid certificate. A sub-repairman's certificate using another entity's number was invalid; without it…
Could a business-operations sale qualify as an occasional sale when the seller retained vehicles, trailers, and a lawn tractor?
Not if the entire business was being sold, because all operating assets had to transfer. A sale of an identifiable segment could qualify if the retained items served general business purposes rather t…
When could an equipment rental company accept a resale certificate for tents, arches, and food-service equipment rented by caterers, planners, or other rental businesses?
A true rental company could rent items tax-free for re-rental. Caterers were consumers and paid tax on equipment they used. For other customers, a properly completed certificate could be accepted when…
Were bags used by harvesters to pick citrus exempt from Texas sales and use tax as agricultural machinery or equipment?
Yes. Because the bags were used in the actual harvesting of food for human consumption produced for sale, they qualified as exempt agricultural machinery or equipment. STAR flags a later registration-…
Were the Shuttle tri-wheel scooter or wheelchair and the Liftami electric vehicle lift exempt from Texas sales tax?
The Shuttle was exempt as an orthopedic appliance without a prescription. The Liftami qualified as an exempt therapeutic device only when sold, leased, or rented to an individual under a licensed prac…
Were pest-control services exempt merely because they were performed at a school district property through another maintenance company?
No. The pest-control provider charged tax unless the maintenance company gave a resale certificate for resale to the district or had a legal agency agreement allowing an exemption certificate. Reimbur…
Were lease payments taxable in a sale-leaseback of equipment the customer had used for years and already paid Texas tax on?
No. On the stated facts, the Comptroller treated the sale and leaseback as financing: the customer had used the equipment for three to five years and already paid tax, kept possession and operating bu…
Could a contractor acting as agent for a direct-payment-permit holder buy construction consumables tax-free with the customer's permit?
No. A private agency agreement could not shift the tax incidence. Rule 3.291 required the contractor to pay tax on consumables, and Rule 3.288 limited the permit to items the holder bought for its own…
Did a Fort Worth seller have to collect Abilene's new 1990 city and industrial-development sales taxes, and how did prior-contract relief vary for new local districts?
No. The Abilene taxes were treated as city sales taxes, so a Fort Worth place of business did not collect them. Three-year prior-contract relief applied to the Abilene taxes and some crime-control or …
Could a parent company file one consolidated Texas sales-tax return for 48 wholly owned subsidiaries operating stores in Texas?
No. Each subsidiary was a separate legal entity and had to file its own return. One consolidated return would have been possible only if the stores were divisions of one legal entity rather than separ…
Did American Red Cross chapters making taxable sales have to obtain Texas sales-tax permits, pay the permit fee, and collect tax despite governmental-entity status?
Yes. The Red Cross remained a governmental entity, but an attorney general opinion required any governmental entity making taxable sales to be permitted, pay the fee, and collect and remit tax like ot…
Did a nonprofit historical organization collect tax on books and newsletters it published and distributed, and did it pay tax on its own organizational purchases?
No. The organization did not collect sales tax on its qualifying books and newsletters and was also exempt from paying sales tax on taxable items purchased for its own use.
Were carwash sand-trap and restaurant grease-trap pumping charges taxable, and could scheduled preventive service qualify as maintenance?
As-needed pumping and related plumbing cleaning on nonresidential property were taxable repairs. Documented, scheduled, periodic preventive pumping could be nontaxable maintenance, whether the trap co…
Could a seller exempt Fastrack sold as feed for farm and ranch animals when the product also had nonexempt uses?
Yes, with a purchaser exemption certificate stating the product was bought for farm or ranch animal feed. One blanket certificate per customer covered later qualifying purchases. STAR flags a registra…
Were computer-assisted leak-detection testing services for underground petroleum and chemical storage tanks taxable?
No. The testing charge was nontaxable even though the provider used a computer in its vehicle. As a nontaxable service provider, it paid tax on the computer and other taxable items used to perform the…
Did Al-Anon have to collect and remit Texas sales tax on literature that it published and distributed?
No. The Comptroller confirmed that, as of August 28, 1989, Al-Anon did not have to collect or remit sales tax on literature it both published and distributed. The letter said a revision to Rule 3.299 …
How did Texas tax industrial gases, propane, sterilizing or cleaning gases, breathing-air refills, and cylinders when the buyer supplied only limited use facts?
The result depended on use. Gases consumed in manufacturing or protecting the product or environment could be exempt, while repair, sterilizing-water, and tank-cleaning uses were taxable. Propane was …
When were wigs, toupees, hair pieces, replacement parts, and repair or maintenance services exempt from Texas sales tax as prosthetic devices?
They could be exempt when bought to replace hair missing from the body. Specifically designed replacement parts and repair or maintenance of a qualifying prosthetic hair piece were also exempt. Cleane…
How did Texas tax gifts shipped directly outside the state, prizes stored in Texas before out-of-state use, and mailer services?
Texas tax was not due when Texas suppliers shipped gifts directly to the company's out-of-state offices. Texas-purchased prizes stored in Texas before outside use were taxable, while items bought outs…
Did the Dallas/Fort Worth International Trade Resource Center qualify for Texas sales-tax exemption as a chamber of commerce?
Yes. The Comptroller classified the Resource Center as a chamber of commerce because it promoted the advantages of doing business in the Dallas-Fort Worth area, assuming it remained a nonprofit organi…
Could preprinted farm-use language on a sales invoice replace a Texas exemption certificate, and what information did an invoice-based certificate need?
No. The proposed preprinted statement was insufficient. An invoice could serve as the certificate only if it contained the purchaser and seller names and addresses, item description, a purchaser-compl…
Was a book exempt when published by a nonprofit historical organization but marketed and distributed through a separate commercial press?
No. The exemption required the qualifying nonprofit to publish and distribute—ship, market, or sell—the writing. Because the commercial press appeared to handle distribution, the book sale was taxable…
Did resale certificates issued to the previous owner of an acquired business remain valid for the new owner?
Generally yes: the purchaser, not the seller, invalidated or revoked a valid resale certificate, so a prior owner's valid certificate carried over to the new owner of an existing business. But the sam…
How did Texas tax new underground-cable construction, moving existing buried cable for road work, and repairing or replacing that cable?
New construction followed the contractor rules: a lump-sum contractor paid tax on materials and did not collect from the customer, while a separated contractor could buy incorporated materials for res…
Did a nonprofit genealogical society collect Texas sales tax on books it published and sold, and on books written by individuals?
Its own books were exempt because qualifying nonprofit organizations' writings were not taxable when the organization both published and distributed them. Books published by individuals but merely sol…
Did a county genealogical society owe Texas sales tax on books and other writings that it published and sold?
No. Effective August 28, 1989, qualifying nonprofit religious, philanthropic, charitable, historical, and scientific organizations did not owe tax on writings they published and distributed. The lette…
How did a veterans' post's Texas sales- and franchise-tax exemptions affect its purchases, resale inventory, permit, and taxable sales?
The post owed no franchise-tax report after its exemption cleared the account and could buy items tax-free when they furthered its exempt purpose. It could not use that exemption for beer, soda, cigar…
Were children's books sold by a nonprofit educational organization exempt under Texas's 1989 exemption for periodicals and writings?
No. The books were taxable. Effective August 28, 1989, the stated exemption covered writings published and distributed by charitable, religious, nonprofit philanthropic, and historical organizations, …
Did a motel charge Texas sales tax on guests' long-distance calls and its 50% service charge, and could the Comptroller decide whether the markup was legal?
Both the long-distance charge and the 50% service charge were taxable when Rule 3.344(b)(4)'s conditions were met because the hotel was a telephone company under the rule. The Comptroller could not de…
Could a seller of taxable two-way-radio airtime issue resale certificates for telecommunications services it purchased?
Yes, for purchased telecommunications that could be identified as part of the service resold to a particular customer, such as identifiable long-distance charges. Generally no for basic local exchange…
Were customer charges for an electronic toll-account service taxable when each customer also received an in-car counting device?
No. The Comptroller treated the transaction's essence as a nontaxable service even though customers received Tolltags. The provider had to pay sales tax when buying the devices, and its separate charg…
When did assigning an equipment lease avoid accelerated Texas tax, and did an out-of-state buyer of Texas leases have to collect Texas tax?
Selling both the leased equipment and lessor rights transferred collection responsibility to the buyer and avoided accelerated remittance if the seller obtained a resale certificate. A later title-tra…
Were voluntary viewer contributions to an FCC-licensed television translator station taxable as telecommunications or cable-television revenue?
No. After reviewing the station's FCC license, the Comptroller concluded that its rebroadcasting was neither taxable telecommunications nor cable-television service. Viewers could receive the service …
Were a genealogical organization's sales of census records, family group sheets, obituaries, tax records, and cemetery inscriptions taxable?
No. The Comptroller said the organization's sales of those publications were not taxable as of August 28, 1989, based on the facts presented.
Were sales of the Cherokee County History taxable when the commission both published and distributed the book?
No. The Comptroller said sales of the Cherokee County History published and distributed by the commission were not taxable as of August 28, 1989.
Did a coupon-book company pay Texas tax on printing booklets containing postage stamps, and were the supermarkets' stamp sales taxable?
The company owed tax on Texas printing and could not give the printer a resale certificate, while the supermarket's sale of the postage stamps was not taxable. Printing charges for booklets the printe…
Were crushed gravel and delivery taxable when sold to farmers for stock pens, roads, and driveways, and how were unprocessed materials treated?
Crushed gravel and delivery were taxable because crushing was processing. A farmer could use a valid exemption certificate when the gravel served as a drying agent in stock pens, but gravel for farm o…
Could a purchaser use MTC Exhibit 1100-D in Texas for resale and manufacturing purchases, or did it need a Texas exemption certificate?
Texas accepted Exhibit 1100-D as a resale certificate for items bought for resale, lease, or rental, including manufacturing inputs that became component parts. It could not cover exemption-only purch…
Which services of a city contractor-assistance program were taxable: site visits, consultations, research lists, document copies, fax, delivery, calls, and workshops?
Site visits and consultations were nontaxable; market-research and agency-match lists, vendor-parts histories, microfiche copies, and fax transmissions were taxable. Delivery and long-distance charges…
When were a petroleum consultant's computer-assisted geophysical work, data entry, typing, and reel-to-reel copying taxable Texas services?
Scientific analysis and interpretation tailored to a client were nontaxable even when a computer was used. Merely entering or manipulating already-analyzed customer data and producing a report was tax…
Was the Xerox/Kruzweil Personal Reader exempt when sold, leased, or rented for use by legally blind or dyslexic individuals?
Yes. For a legally blind user, the text-to-speech reader qualified under Rule 3.284(c)(5) with an exemption certificate. For a person with dyslexia, it qualified as a therapeutic appliance when suppli…
Was the Xerox/Kurzweil text-to-speech Personal Reader exempt for a legally blind user, and could previously paid sales tax be refunded?
Yes. The portable optical scanner qualified under Rule 3.284(c)(5) when sold, leased, or rented for use by the legally blind. A properly completed exemption certificate was required, and presenting it…
Did a seller making only exempt natural-gas sales need a Texas sales-tax permit, and what certificate proof could suppliers require?
No permit was required solely to report exempt natural-gas sales, but the seller had to give a resale certificate when a supplier requested one. A certificate without a permit number could be accepted…
Could a motor-vehicle dealer buy logo-bearing keyrings, trunk nameplates, and license-plate frames tax-free for resale?
No. Texas treated dealer-name or logo-bearing keyrings, trunk nameplates, and license-plate frames as advertising and promotional items rather than resale purchases. The dealer was told to continue co…
Were sales of untreated water to farmers and manufacturers taxable, and did a water-only seller need exemption certificates or a sales-tax permit?
No. Water was exempt by statute regardless of whether the customer was a farmer or manufacturer, so the seller needed no customer exemption certificate and, if it sold only water, no sales-tax permit.…
Did the manufacturing exemption apply to janitorial work at a meat-packing plant when collected scraps and fat later entered the rendering process?
No. The service cleaned the plant's walls and floors, not the product being manufactured. Picking up scraps remained part of taxable janitorial work even though the plant later rendered and sold them …
Were labor charges to repair or recondition reusable steel drums exempt when the work was required by federal transportation rules?
Yes. Tax Code § 151.338 applied to steel-drum repair or reconditioning performed as set out in the cited federal transportation regulation, so the labor charge for repairing the drums was exempt.
Were green fees, yearly golf-course memberships, golf-cart rentals, and pull-cart rentals taxable when provided by a Texas governmental entity?
Governmental green fees and yearly memberships representing admission to the golf course were not taxable amusement services. Golf-cart and pull-cart fees were taxable rentals of tangible personal pro…
How did Texas tax septic-tank cleaning, grease-trap cleaning, waste hauling, and municipal dumping or landfill fees?
Septic-tank cleaning was nontaxable for homes and businesses, including hauling and the city sewer dumping fee. Sewer-connected commercial grease-trap cleaning was taxable unless it qualified as sched…
Did an insurance marketer need a Texas sales-tax permit merely to use computers to obtain prospective-customer leads?
No. Insurance coverage was not subject to sales tax, and using computers to procure insurance leads rather than sell taxable items did not require a permit. The marketer still owed tax on buying, leas…
Which separately contracted pipeline inspection, cleaning, testing, repair, valve, boosting, evacuation, and temporary-equipment services were taxable?
Pipeline cleaning, linalog and X-ray inspection alone, hydrotesting, capacity boosting, and evacuation were nontaxable when separately contracted directly with the provider. Repairs, digging, pipeline…
Was trash removal taxable when performed as part of otherwise nontaxable restoration of flood-damaged real property?
Yes. The Comptroller said waste-removal service remained taxable even when connected with a nontaxable restoration service following a natural disaster.
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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.