Could a customer claim a residential gas or electricity exemption or refund after the utility account had been closed?

Plain-English summary

A closed natural-gas or electricity account could not receive the residential exemption or a refund through the ordinary on-site study process because the utility uses could no longer be examined.

The Comptroller would decide based on the available information. The residential owner needed to identify the account, explain why it closed, describe what the utilities were used for, and provide any other information supporting the exemption and refund.

If the site had both exempt and nonexempt utility uses, the exemption would not be allowed because no study could determine predominant use.

Common questions

Was a closed account automatically disqualified? No, but it required Comptroller approval based on evidence.

What information was needed? Account identity, reason for closure, utility uses, and other available proof.

What if the property had mixed uses? The exemption was denied because predominant use could not be studied.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9002L0979A13

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, 78774

BOB BULLOCK
Comptroller February 1, 1990

Dear ***:

Thank you for your letter regarding sales tax exemption on utili-
ties for residential use on accounts that have been closed.

Sales tax exemption and refunds cannot be claimed on inactive
natural gas and electricity accounts because an on-site study of
the utility uses cannot be made. The utility companies will
generally not refund the tax on an inactive account without
approval from this office.

A determination to allow tax exemption and refund on an inactive
residential account will be made based on the information pres-
ented to this office. The person claiming exemption (residential
owner) will need to identify the account name and tell us why the
account was closed, what the utilities were used for, and any
other available information to determine that exemption and refund
are appropriate. If there were both exempt and nonexempt uses,
sales tax exemption will not be allowed because a study could not
be performed to determine predominant use.

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

If you have any questions or need additional information, you may
call me toll free at 1-800-252-5555, extension 3-4666, or the
regular number 512/463-4666. You may write to Tax Correspondence,
Comptroller of Public Accounts.

Sincerely,
Jo Ann Dieck
Tax Correspondence