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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Was an exemption certificate valid when signed at the start of an exempt job and then photocopied for later use?
Yes, if the rest of the certificate was properly completed. The follow-up letter added that each certificate given to a supplier had to show the current date it was issued.
When did electricity qualify for exemption under the predominant-use test, and what rules applied to exemption certificates and refunds of previously collected tax?
More than 50% of metered electricity had to be exempt use, supported by a usage study. Sellers were not required to refund prior tax, and refunds required qualifying historical use, an active meter, a…
Could a taxpayer use modified invoices obtained after completed transactions to satisfy a separate-statement requirement and change the sales-tax result?
No. Executive Counsel rejected after-acquired modified invoices because the completed transaction's form determined taxability and the later documents were obtained only to alter that result.
What certificates, meter-by-meter studies, records, refund proof, and ongoing monitoring were required for customers claiming a utility sales-tax exemption?
Each meter had to qualify separately, with account-specific certificates and a valid study showing over 50% exempt use where uses were mixed. Claimants kept proof, updated changes, and withdrew certif…
Could a chiropractor prescribe vitamins tax-free for Texas sales-tax purposes?
Yes. The Comptroller said chiropractors were treated like doctors for sales-tax purposes and could prescribe vitamins tax-free.
Could a supplier accept an exemption certificate on products sold to chiropractors, and could chiropractors dispense vitamins, minerals, and food supplements without collecting sales tax?
Yes. The supplier could accept the certificate; food supplements were exempt as food, and chiropractors could dispense vitamins and minerals tax-free as drugs and medicines.
What Texas sales-tax exemptions applied to sales by Boy Scout troops?
The Comptroller said Boy Scout branches qualified as educational organizations, allowing one tax-free sale yearly and exempt qualifying food sales.
Could a telephone company accept one blanket exemption certificate for a customer's multiple locations?
Yes, if every location and number was identified. The certificate also had to describe the services plainly and list the purchaser's phone number.
Were utilities exempt when a building owner included them in rent charged to the Mexican Consulate?
No. The building owner, not the consulate, bought the natural gas and electricity, so the utilities were taxable commercial use.
What certificates and shipping records did a Texas seller need for offshore-use and export sales-tax exemptions?
Texas required a complete exemption claim for qualifying offshore goods or prescribed export proof; vague offshore wording and unsupported Texas delivery were insufficient.
Could a church use a Texas sales-tax exemption certificate before the Comptroller had approved its exempt status?
No. The Comptroller's records showed the church had not qualified; after approval, it could give its utility an exemption letter and certificate.
What resale certificates and shipping proof did Texas require for interstate sales, exports, and Section 151.324 goods?
Interstate and export sales required the applicable resale and shipping records, while qualifying Section 151.324 goods used exemption certificates instead.
Did a fish farm raising fish for sale qualify for Texas's agricultural sales-tax exemption?
Yes. The exemption covered the fish and qualifying food, medication, and machinery or equipment used exclusively to raise them, subject to documentation.
When could a Texas seller avoid collecting tax on exported goods, and what documentation was required for Texas delivery?
Oilfield goods could use an exemption certificate; other exports needed proof before title or possession passed, and Texas delivery was presumed taxable until documented.
Which tractor, farm, and off-highway tires qualified for Texas's agricultural sales-tax exemption?
Exempt tires included repair or replacement parts used exclusively on farm machinery, tires for unlicensed vehicles, and manufacturer-designated farm or off-highway tires.
Could an electric cooperative recover tax on its ownership share of generating-project property purchased after its operating agreement?
Yes, for purchases from the agreement date based on its ownership percentage, using supplier refunds and a project-specific exemption certificate; earlier purchases did not qualify.
Were lime and crushed limestone used as a feedlot desiccant exempt from Texas sales tax?
Yes. The products qualified for exemption, and the purchaser could give the supplier an exemption certificate instead of paying tax.
Could an airline buy or temporarily store materials tax-free before shipping them to Saudi Arabia?
Yes, under the stated conditions. Airline-carried items qualified under the common-carrier exemption; sea shipments needed export proof, and qualifying out-of-state purchases could be stored temporari…
Were components of a specialized honey house used only to process the beekeeper's own honey exempt?
Yes, on the stated facts. The on-farm structure was built only for extracting and bottling the beekeeper's own honey and was not used for storage or offices.
Were single-use Quick Cups consumed in mandatory metal-casting quality control exempt from Texas sales tax?
Yes. The cups qualified because they were used and consumed in the manufacturing process, and the manufacturer could give its supplier an exemption certificate.
What made the submitted agricultural exemption certificate acceptable to a Texas seller?
The form relieved the seller when the purchaser completed it, the seller accepted it in good faith, it was signed and dated, the goods were eligible, and the form was tied to the invoice. STAR warns t…
Was sawdust used by a meat-packing company to smoke meat taxable?
No. The sawdust was necessary and essential and was consumed in processing the meat. The seller was instructed to obtain a properly completed exemption certificate from the customer instead of collect…
Were computers used by contractors on federal real-property contracts taxable?
Yes for purchases, leases, or rentals effective October 2, 1984, including parts and supplies. A contractor could claim the historical preexisting-contract exemption for a federal contract entered bef…
Which conservation-district items and services were taxable, and which qualified for farm or ranch treatment?
The 1985 letter classified a list item by item. Agricultural-use fertilizer, lime, irrigation systems, grass seed, and some farm equipment were not taxable, while home-use or erosion-control purchases…
Were mites sold for fire-ant control exempt when used on a farm or ranch?
Yes under the stated facts, when purchased for exclusive farm or ranch use. The 1985 letter treated the mites as farm or ranch work animals and required an exemption certificate; STAR warns that regis…
When could condensate used as well-treating fluid be sold tax free, and when was tax due?
Condensate was generally taxable. A well operator could give an exemption certificate when treating its own well and the condensate remained in and was sold with the crude; a reseller could give a res…
Were repairs to built-in heating, cooling, and plumbing equipment taxable in Texas after October 2, 1984?
Generally no for equipment wired or plumbed into the realty, such as central heating and air-conditioning units. Repairs to plug-in property, such as a window unit, and associated trip or mileage fees…
Could a Texas restaurant buy charcoal used in food preparation without paying sales tax?
Yes. Charcoal consumed in preparing food for sale was an exempt necessary and essential processing material, and a qualifying restaurant could give the seller an exemption certificate.
Could a Texas school buy award jackets tax-free either to present to students or to resell to them?
Yes. A school could use an exemption certificate for jackets presented to students. For jackets sold to students, it used a resale certificate and had to collect and remit tax on the student sales.
Could a Texas school district buy athletic jackets tax-free either as student awards or for resale to students?
Yes. Award jackets could be bought with an exemption certificate. Jackets bought for sale to students required a resale certificate, followed by collection and remittance of tax on the student sale.
How did Texas tax TV pickup and delivery, warranty repair parts, and flat-rate manufacturer warranty charges?
TV pickup and delivery charges were taxable. Manufacturer-warranty repair parts created no tax liability if properly recorded and bought with an exemption certificate, and a flat-rate charge to the ma…
Were Texas packing, crating, and shipping labor and the related packing materials taxable for domestic and international shipments?
Packing, crating, and shipping labor was not taxable. Materials protecting items shipped outside U.S. territorial limits could be bought with an exemption certificate, while materials for U.S. shipmen…
Was electricity used to extract oil from the ground exempt from Texas sales tax, and what certificate was required?
Yes. The Comptroller said electricity used to extract oil from the ground was specifically exempt, and the purchaser had to give the utility company an exemption certificate.
Were railroad crossties shipped into Texas exempt as supplies essential to operating locomotives and trains?
Yes. The Comptroller treated railroad ties as supplies essential to train operations under Section 151.331, so the seller did not collect Texas use tax when the purchaser issued an exemption certifica…
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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.