Is a cane-like device designed to help Parkinson's disease patients overcome motion block exempt from Texas sales tax?

Subject

Stepp — Alert — Cane — Like Device Designed For Patients Afflicted With Parkinson'S Disease And Experiencing Motion Block Phenomenon

Plain-English summary

A taxpayer wrote to the Comptroller asking whether a new medical product called STEPP-ALERT was taxable. The product is a cane-like device with a multi-colored flap at the foot of the staff. The flap acts as a visual cue, giving the user something immediate to focus on and step over, which helps break out of a "motion blockage." It was designed for patients with Parkinson's disease, particularly those experiencing motion block phenomenon.

The Comptroller ruled that the STEPP-ALERT qualifies as a therapeutic device and may be purchased tax free by an individual with a doctor's prescription, citing Rule 3.284(c)(8). The letter notes the answer is based on the facts presented and that different (even similar) facts could lead to a different result.

What this means for you

Sellers of medical and mobility devices

If you sell a device designed to treat or manage a specific medical condition -- here, a cane-like walking aid marketed to Parkinson's patients to address motion block -- it may qualify as an exempt therapeutic device under Rule 3.284(c)(8) when the buyer presents a doctor's prescription. Ordinary canes without a therapeutic design or purpose would not automatically get this treatment; the ruling turns on the product being designed for, and marketed to, a specific patient population.

Patients and caregivers purchasing assistive devices

If a doctor prescribes a therapeutic device like the STEPP-ALERT for a diagnosed condition, you should be able to buy it exempt from Texas sales tax by providing the prescription at the time of purchase.

Accountants and tax professionals

This letter is a useful, if narrow, example of Rule 3.284(c)(8)'s therapeutic-device exemption being applied to a novel product (a cane-like device, rather than a more conventional durable medical good). The exemption depends on the prescription requirement being met, not merely on the product's marketing claims.

Common questions

Q: Is the STEPP-ALERT taxable in Texas?
A: No. The Comptroller ruled it qualifies as a therapeutic device and can be purchased tax free.

Q: Do I need anything to buy it tax free?
A: Yes -- a doctor's prescription. The ruling specifies the device "may be purchased tax free by an individual with a doctor's prescription."

Q: What rule does the exemption come from?
A: Rule 3.284(c)(8), the Comptroller's rule addressing therapeutic devices and appliances.

Q: Would a similar device automatically qualify for the same exemption?
A: Not necessarily. The letter states the opinion is based on the facts presented, and different facts, although similar, may result in different answers.

Citations and references

• 34 Tex. Admin. Code Rule 3.284(c)(8) (therapeutic devices and appliances)

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9607L1432F14

Original ruling text

July 24, 1996

Dear **:

Thank you for your letter dated July 19, 1996, concerning the taxability
of a new medical product with the trade name STEPP-ALERT. The literature
you provided that describes the product was most helpful.

The product is a cane like device with a multi-colored flap at the foot
of the staff designed to act as a visual cue giving the patient the ability
to focus on an immediate object which they can then step over and break
out of the motion blockage.

The product was designed for patients afflicted with Parkinson's disease
and particularly those Parkinson's patients experiencing motion block
phenomenon.

Comptroller Response: The STEPP-ALERT qualifies as a therapeutic device
and may be purchased tax free by an individual with a doctor's prescription.
Rule 3.284(c)(8).

This opinion is based on the facts presented and current law. Different
facts although similar, may result in different answers.

If you have any questions or need more information, you may call me toll
free at 1-800-531-5441, ext. 50330. The direct line is 512/475-0330. You
may also write to Tax Policy Division, Comptroller of Public Accounts.

Sincerely,

Bettie Peterson
Tax Policy Division

NOTE: Previous Accession Number 9607602L