Ezel / Tax Rulings / TX
TX 8607L0744G12 Sales and/or Use Tax (State,Local,MTA) 1986-07-01

When did Texas make damage-waiver fees taxable after postponing the effective date announced in the June 1986 Sales Tax Review?

Short answer: September 1, 1986. The Comptroller postponed the announced July 1 effective date by two months so lessors had time to reprogram their computers.

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This page answers the general question as of 1986. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1986
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official July 1986 internal Texas Comptroller memorandum to enforcement directors, not a taxpayer-specific private letter ruling. It reports a historical effective-date change for taxing rental damage-waiver fees and does not establish current law or taxpayer reliance rights. STAR documents may no longer represent current policy. This summary is informational only and is not legal or tax advice. Consult a licensed Texas tax professional about current treatment.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page) is the authoritative source for any reliance.

Plain-English summary

The June 1986 Sales Tax Review had announced that damage-waiver fees would become taxable on July 1, 1986.

This internal memorandum changed the effective date to September 1, 1986 so lessors had time to reprogram their computers. Enforcement directors were instructed to pass the update to field offices.

Common questions

What was the original effective date? July 1, 1986.

What date replaced it? September 1, 1986.

Why was the change made? To give lessors time to reprogram their computers.

Source

Original ruling text

July 1, 1986

TO: Dan Pearson and Enforcement Directors
FROM: Wanda Hutcheson
SUBJECT: Damage Waiver Fees

The June 1986 issue of the Sales Tax Review stated that damage waiver
fees would become taxable effective 7-1-86.

We have agreed to change the effective date to 9-1-86 to allow lessors
time to reprogram computers.

Please provide this information to field offices.

Thank you.

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