Which radiator, cooling-system, air-conditioning, and related repair charges were taxable?

Plain-English summary

For an individual customer's automobile radiator, cleaning and repair labor was nontaxable. In recoring, cooling-system, and air-conditioning work, parts were taxable while labor was not. A complete radiator sold for customer installation was taxable along with incoming freight. A trucker's roadside radiator-repair travel and labor charges were also treated as nontaxable.

Work for an automotive repair or body shop was not taxable when the shop supplied a resale certificate. A construction company's ordinary automotive radiator repair was nontaxable if the customer identified it as automobile work; otherwise it was taxable. Parts and labor for industrial or off-road radiators, off-road cooling systems, and off-road steam cleaning or backflushing were taxable.

Automobile fuel-tank steam cleaning and leak repair labor was nontaxable. Stripping an antique metal bed frame was taxable. For stained glass removed from a building, supplies were taxable and labor was not if the invoice identified the window as real property; otherwise both parts and labor were taxable. A newly sold stained-glass item was entirely taxable whether billed as one amount or with parts and labor separately stated.

Common questions

Was automobile radiator repair labor taxable? No under the stated examples. Were auto parts taxable? Yes. What about off-road equipment? The listed parts and labor were taxable. Did a resale certificate change repair-shop transactions? Yes; the listed transactions were not taxable with the certificate on file.

Citations and references

The reproduced letter cites no numbered statute or rule.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8505L0651C03

Original ruling text

May 20, 1985

Dear ***:

Thank you for your letter of May 10th which is restated with responses
below.

The following request is being made upon the advice of one of your public
assistant personnel, following numerous attempts at determining exactly how we
should be taxing our customers for our sales and services.

The request is that each of the following examples of our business invoices be
marked "taxable" or "nontaxable" and that the letter be certified to hold up in an
audit, signed and returned to us.

The following are statements of a situation and the manner in which the charges are
invoiced:

"L" = labor, "P" = parts/supplies.

1) An individual customer brings his automobile radiator to be cleaned and repaired,
and is invoiced as follows:

L - Boil out, rod out and repair radiator

Response: The labor is nontaxable.

2) An individual customer brings his automotive radiator to be repaired,
i.e., we take off his old tanks and side straps/brackets and re-solder them to
the new core, pressure test and paint the radiator:

P - New core and solder $
L - Take off tanks, side straps and re-solder to new core, pressure test & paint $

Response: Parts are taxable but labor is not taxable.

3) An individual customer brings his automobile to us to check out and repair his
cooling system. Invoiced as follows:

P - New fan clutch $
New thermostat & Gasket $
2 gal. anti-freeze @ $ $
Total parts/supplies $
L - Boil out, rod out & repair radiator $
R & R Radiator $
R & R Thermostat & Gasket $
Total $

Response: Same as #2.

4) An individual customer buys a new complete radiator from us to replace
his old one and installs it himself. Invoiced as follows:

P - New complete radiator $
Freight - Total $

Response: Parts and incoming freight are taxable.

5) An automotive repair or body shop brings his customer's radiator in
for clean and repair, - he has filed a tax resale certificate with us.
Invoiced as follows:

L - Boil out, rod out and repair radiator, - List $_ Net $

Response: Not taxable.

6) An automotive repair or body shop brings his customer's radiator in to
be repaired. Invoiced as follows:

P - New core List Net $
L - Same as example #2 $
Total $

Response: Not taxable because it is for resale and you have a
certificate on file.

7) An automotive repair or body shop buys a complete new radiator from
us. Invoiced as follows:

P - Complete new radiator List Net $
Freight $
Total $

Response: Same as for #6.

8) An automotive repair or body shop brings his customer's vehicle to us
to trace out cooling system problem. Invoiced as follows:

P - New fan clutch List Net $
Thermostat & gasket $
2 gal. anti-freeze @ $ $
Total $

L - R & R radiator $
R & R thermostat & gasket $
R & R fan clutch $
Boil out, rod out and repair radiator $
Total parts $

Response: Same as for #6.

9) A construction company brings us a regular automotive radiator to be
cleaned and repaired. Invoiced as follows:

L - Boil out, rod out and repair radiator $

Response: Not taxable if the customer claims it is for an automobile; otherwise,
it is taxable.

10) A construction company brings us an industrial bolt-on tank radiator
for off-road equipment or machinery to be stripped, cleaned and repaired.
Invoiced as follows:

P - Gaskets & gasket sealer $
New bolts, nuts, lockwashers - Gr. 5 Solder $
Total parts $

L- Remove all bolts, nuts & backwashers from radiator: remove tanks, side straps,
brackets Boil out, rod out, re-solder headers & tubes Reassemble radiator, pressure
test, paint $

Response: Both parts and labor are taxable.

11) A construction company brings same type radiator as in Ex. #10. We are unable
to repair radiator, so recore it. Invoiced as follows:

P - Same as in Ex. #10 $
Plus new core $
TOTAL parts $

L - Same as in Ex. #10 plus an additional $
charge for additional reassemble $
Total parts $

Response: Same as for #10.

12) A construction company brings us an off-road piece of equipment
(maintainer, backhoe, loader, etc.) to trace out and correct cooling system
problem. Invoiced as follows:

P - Same as in #10 $
Plus new thermostat 7 gasket $
5 gal. anti-freeze @$ $
Total parts $

L - R & R radiator $
R & R thermostat & gasket $
Same as in #10 for radiator repair $
Total labor $

Response: Same as #10.

13) A construction company brings an off-road equipment in for us to
steam clean and backflush the engine cooling system. nvoiced as follows:

L - Steam clean equipment $
Drain radiator, R & R bottom & top $
Hoses and thermostat housing $
backflush system $
Total labor $

Response: Taxable.

14) An individual brings his automobile for us to trace out air
conditioning problem and correct. Invoiced as follows:

P - New air compressor $
New accumulator/dryer $
New expansion valve $
New thermal switch $
5 c. freon @ $ $
6 o-rings @ $ $
Total parts $

L - Bleed A/C system R & R air compressor, remove grill in order to
change accumulator dryer, R & R expansion valve & thermal switch, replace
grill, pull vacuum, pump freon & test run

Response: Parts are taxable. Labor is not taxable.

15) An individual brings his automobile for us to pump freon into his air
conditioning unit. Invoiced as follows:

P - 3 c. freon @ $ $

L - Check refrigerant pressure, pump freon $

Response: Same as for #14.

16) An individual brings his automobile in for us to steam-clean and
repair his fuel tank. Invoiced as follows:

L - Steam clean fuel tank $
Repair leaks & pressure test $
Total labor $

Response: Not taxable.

17) An individual brings in an item of stained glass for us to repair.
Invoiced as follows:

L - Remove broken glass (pieces), clean adjoin-solder (or came), cut, grind
& solder-prepare new stained glass piece, reset and solder in place, clean and polish $

upplies - Stained-glass $
Solder $
Gold foil (or came) $
Total $

Response: If this were a stained-glass window removed from a building,
the supplies would be taxable; and the labor nontaxable. Your invoice should
identify the window as part of real property.

Otherwise, both parts and labor are taxable. $

18) A customer brings us a metal bed frame (antique) to be holed out and
stripped. Invoiced as follows:

L - Boil out and strip clean-antique bed frame $

Response: Taxable.

19) A trucker calls us for a trouble call his fan has hit the radiator.
Invoiced as follows:

Travel charges to site - (# miles x$) $
Travel time (# hrs/min x $)
R & R radiator and fan blade $
Boil out & repair radiator $

Response: Not taxable.

20) A customer buys a new stained glass item. Invoiced as follows:

Supplies - stained-glass $
materials (gold foil, solder, polish)Labor hrs x $- $
Total $

or should this be invoiced for a set amount without listing supplies and
labor separately?

Response: Totally taxable. Either billing is acceptable.

This opinion is based upon the facts you presented. If there are
additional or different facts, this opinion may change.

Please feel free to contact us if you have additional questions. You may
write us, call toll free 1-800-252-5555 from anywhere in Texas.

Sincerely,

Tax Policy Section
Tax Administration Division