Were Texas repair charges for exempt medical equipment and prescribed therapeutic appliances taxable?

Plain-English summary

Texas Tax Code § 151.3111 exempted repair, maintenance, remodeling, and restoration services performed on property that would itself be exempt because of its nature, use, or both.

The Comptroller therefore said repairs to exempt medical equipment were not taxable, and the repairer did not need an exemption certificate. Rule 3.284 supplied the medical-equipment definitions.

Repairs to a therapeutic appliance or device were exempt when an individual used the item under a prescription from a licensed healing-arts practitioner. The original vendor did not need a new repair prescription if it already held the original prescription; another repairer needed a prescription for the repair.

What this means for you

The repaired item's exempt status and prescription documentation controlled the result. The letter did not exempt repairs to every item used in a medical setting.

Common questions

Were repairs to exempt medical equipment taxable? No.

Did the repairer need an exemption certificate? Not for exempt medical equipment under the letter.

When were therapeutic-device repairs exempt? When the device was used by an individual under a licensed practitioner's prescription.

Was a new prescription always required for the repair? No. The original vendor could rely on the original prescription on file; another repairer needed a repair prescription.

Citations and references

• Tex. Tax Code § 151.3111 (services on exempt property)
• 34 Tex. Admin. Code Rule 3.284(a), (a)(11), and (c)(6) (medical equipment and therapeutic 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/9012L1064E12

Original ruling text

COMPTROLLER OF PUBLIC ACCOUNTS
STATE OF TEXAS
AUSTIN, TEXAS 78774

December 28, 1990

Dear **:

We received your letter questioning your clients tax responsibilities on
their medical equipment repair service.

Section 151.3111 of the Texas Tax Code provides an exemption from tax on
repair, maintenance, remodeling and restoration service s to property
that would be exempted when sold because of the nature of the property,
its use, or a combination of its nature and use.

Repairs to medical equipment that qualifies for an exemption from the
sales tax are not taxable. See section (a) of the enclosed Rule 3.284
relating to medical equipment for definitions of medical equipment that
is exempt from sales tax. The charge to repair exempt medical equipment
is exempt and the repair person does not need an exemption certificate.

Repairs to therapeutic appliances or devices are exempt if the item is
used by an individual under a prescription of a licensed practitioner of
the healing arts. See section (a)(11) and (c)(6) of Rule 3.284. If the
repairs are performed by the original vendor of the therapeutic appli-
ance who has the original prescription on file, a separate prescription
for the repair is not required. Otherwise, a prescription for the repair
is needed.

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

If you have any questions you may call or write Tax Correspondence. You
may call toll free 1-600-252-5555, or our regular number is 512/463-4600.
My extension is 3-4658.

Sincerely,
Sherry Buckley
Tax Correspondence