Were lumbar cushions and cervical pillows taxable when sold to health-care providers or prescribed individuals?

Plain-English summary

Lumbar cushions and cervical pillows were taxable when health-care providers bought them for their own use. They qualified as exempt therapeutic devices when sold to an individual under a doctor's prescription for treatment of illness or disease.

The seller needed a sales-tax permit and had to collect tax unless the buyer supplied a resale certificate or a copy of the prescription.

What this means for you

Medical-product sellers should document who is buying and why. Provider use was taxable; an individual's qualifying prescription supported exemption.

Common questions

Were hospital purchases taxable? Yes, for the hospital's use. Were prescribed individual purchases exempt? Yes. What documentation did the seller need? A resale certificate or prescription copy.

Citations and references

• 34 Tex. Admin. Code Rule 3.284(a)(11) and (c)(7) (medical 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/9201L1146C14

Original ruling text

January 14, 1992

Dear **:

This is a follow-up to our telephone conversation of January 9,
1992, concerning the taxability of lumbar cushions and cervical
pillows.

Lumbar cushions and cervical pillows are taxable when sold to
health care providers (hospitals, clinic, nursing homes, physicians,
etc.) for their use.

These items qualify for exemption as therapeutic devices when
they are sold to individuals under a doctor's prescription for
the treatment of an illness or disease. See sections (a)(11) and
(c)(7) of Rule 3.284 concerning medical devices.

You are required to have a sales tax permit. A sales tax application
packet is being mailed under separate cover. You will be
required to collect sales tax on sales of these items unless the
purchaser issues a properly completed resale certificate or gives
you a copy of a doctor's prescription.

This opinion is based on the facts provided. If there are
additional or different facts, the opinion could 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