Ezel / Tax Rulings / TX
TX 9110L1137A13 Sales and/or Use Tax (State,Local,MTA) 1991-10-11

Were recurring club assessments billed in late September for October taxable, and were September amusement services taxable if payment arrived after October 1, 1991?

Short answer: October assessments billed in advance at the end of September were taxable. By contrast, billings for amusement services actually provided in September were nontaxable even when the club received payment on or after October 1.

Apply this to your situation

This page answers the general question as of 1991. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1991
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 Texas Comptroller of Public Accounts letter published on the State Tax Automated Research (STAR) system. Letters on STAR can be the basis of a detrimental reliance claim only for the taxpayer to whom the letter was directly issued (see 34 Tex. Admin. Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded. Taxpayer-identifying details are redacted. This summary is informational only and is not legal or tax advice. Consult a licensed Texas tax professional about your specific situation.
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 nonprofit private club asked how the October 1, 1991 sales-tax change applied to recurring assessments. Assessments billed in advance at the end of September for the month of October were taxable.

The result was different for amusement services actually provided in September. Those billings were nontaxable even if the club received payment on or after October 1.

What this means for you

The letter distinguished advance billing for a taxable October period from later payment for a nontaxable September service period. A September invoice date alone did not determine the answer.

Common questions

Were late-September bills for October assessments taxable? Yes. Were September services taxable because payment arrived in October? No. What fact separated the two? The month in which the billed amusement service was provided.

Citations and references

  • The letter does not identify a numbered statute or administrative rule.

Source

Original ruling text

October 11, 1991

Dear **:

Thank you for your letter of October 7, 1991, requesting written
confirmation of information given by telephone regarding the recent
change in the sales tax law which affects membership fees,
dues, and assessments paid to nonprofit private clubs.

Your understanding is correct in that recurring assessments that
are billed in advance at the end of September will be subject to
sales tax. Thus, the billings sent at the end of September for
the month of October are subject to sales tax. However, billings
for amusement services provided in September will not be taxable
even if paid on or after October 1.

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

You may call toll free 1- 800-252-5555 if you have any questions
or need more information. You may write to Tax Administration
Division, Comptroller of Public Accounts.

Sincerely,

Eddie C. Washington
Tax Administration Division

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