Were exercise bicycles and treadmills exempt therapeutic devices when sold on a doctor's prescription for rehabilitation?

Plain-English summary

The Comptroller said exercise bicycles and treadmills sold on a doctor's prescription for rehabilitation were exempt as therapeutic devices.

The same equipment was taxable when sold to doctors, hospitals, or clinics unless the purchasing institution separately qualified for an exemption. The letter enclosed Rule 3.284 on drugs, medicines, medical equipment, and devices.

What this means for you

The historical exemption depended on both a doctor's prescription and a rehabilitation purpose. A medical purchaser was not automatically exempt merely because it was a doctor, hospital, or clinic.

Common questions

Did the exemption cover treadmills as well as exercise bicycles? Yes.

Was a prescription required? The letter describes a doctor's prescription as part of the exempt sale.

Were sales to hospitals automatically exempt? No. The institution had to otherwise qualify for exemption.

Citations and references

• 34 Tex. Admin. Code Rule 3.284 — drugs, medicines, medical equipment, and devices.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8802L0868B01

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

BOB BULLOCK
COMPTROLLER February 16, 1988

Dear **:

On behalf of Mr. Bullock, I hope you'll accept my apology for the delay
in
answering your question involving changes in the sales tax law. This
isn't
the way we normally do business.

Our people were, and still are, swamped by a deluge of inquiries as they
attempted to interpret provisions of the new law and draft rules which
would
not adversely impact businesses. In many instances, an answer to a
question
just wasn't available when the question arrived.

Exercise bicycles and treadmills which are sold on a doctors prescription
for
the purpose of rehabilitation are exempt as therapeutic devices.

These items are taxable to doctors, hospitals, or clinics unless an
institution otherwise qualifies for an exemption. I have enclosed a copy
of
Rule 3.284 on Drugs, Medicines, Medical Equipment and Devices for your
review.

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

If you have any questions or need more information, please call our
toll-free
number 1-800-531-5441. The regular number is 512/463-4600. You may
write me
at the Tax Policy Division.

Sincerely,
Eddie Washington
Tax Policy Division