A notary public who prepares deposition summaries and plaintiffs' original petitions for lawyers involved in civil and criminal lawsuits asked whether these services are subject to Texas sales tax.

Plain-English summary

A notary public who also prepares deposition summaries and plaintiffs' original petitions for lawyers handling civil and criminal lawsuits asked the Comptroller whether these services are subject to Texas sales tax.

The Comptroller found they are not, applying Tax Code Section 151.353's court reporting services exemption. That exemption covers the preparation of a document or other record in a civil or criminal suit by a notary public (or a Texas Court Reporters Certification Board-licensed court reporter), as long as the document is (1) prepared for use by a participant in the suit or by the court itself, and (2) sold to a participant in that suit. Since the notary's deposition summaries and petitions fit that description, those specific services are exempt.

Practically, the Comptroller noted that if lawsuit-document preparation is the notary's ONLY business activity, she doesn't need to keep her sales tax permit at all and can call the Tax Assistance help line to cancel it. But the exemption is narrow: it only covers the specific work of preparing documents/records for lawsuit participants. If the notary also performs other, separately taxable services — the letter names data processing, word processing, information services, and security services as examples — unrelated to lawsuit document preparation, she must keep her permit and collect/report tax on those other services.

What this means for you

Notaries, paralegals, and litigation-support providers preparing case documents

Preparing deposition summaries, petitions, and similar documents/records specifically for lawsuit participants (or the court) is exempt from Texas sales tax under Section 151.353 — but that exemption is narrow and tied to the litigation-document context. If you also offer general data processing, word processing, information, or security services outside that context, those remain taxable and require a permit.

Sole proprietors whose only business is exempt court-reporting/document-prep work

If lawsuit-document preparation truly is your entire business, you don't need to maintain a sales tax permit — you can cancel it through the Comptroller's Tax Assistance line, simplifying your compliance obligations.

Accountants and tax professionals advising legal-support businesses

Watch for mixed-service providers: a taxpayer performing BOTH exempt court-reporting-type document prep AND other taxable services (data/word processing, information services) needs to keep the permit and separate the taxable revenue, even though the litigation-document work itself stays exempt.

Common questions

Q: Are deposition summaries and petitions prepared for lawsuit participants taxable in Texas?
A: No — Tax Code Section 151.353 exempts these as court reporting services, when prepared by a notary public or licensed court reporter for use by, and sold to, a suit participant.

Q: If this is my only business activity, do I need a sales tax permit?
A: No — you can cancel your permit through the Comptroller's Tax Assistance help line if lawsuit-document preparation is your only service.

Q: What if I also do other kinds of work, like data processing or security services?
A: You'd need to keep your permit and collect/report tax on those other, separately taxable services — the exemption applies only to the lawsuit-document preparation itself.

Q: Can I rely on this letter for my own notary/litigation-support business?
A: No. It's based on the facts presented, and the letter notes other facts, though similar, may provide a different result.

Citations and references

• Tex. Tax Code § 151.353 (court reporting services exemption)

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9803400L

Original ruling text

March 25, 1998

Dear Ms. **:

This is in response to additional information provided regarding the taxability
of services that you perform. You are a Notary Public and in addition you
prepare deposition summaries and plaintiffs original petitions for lawyers
involved in civil and criminal suits. You are asking if these services are
taxable.

Response: Section 151.353 of the Texas Tax Code exempts court reporting
services relating to the preparation of a document or other record in a civil
or criminal suit by a notary public or a court reporter licensed by the State
of Texas Court Reporters Certification Board if the document is:

(1) prepared for the use of a person participating in a suit or the court in
which a suit or administrative proceeding is brought; and

(2) sold to a person participating in the suit.

Therefore, as a notary public, services (i.e., the preparation of deposition
summaries and plaintiffs original petition) that you provide to participants in
a civil or criminal lawsuit are not taxable. If these are the only services
that you perform, you do not need to retain your sales tax permit. You may
contact our toll free Tax Assistance help line at 1-800-252-5555, to cancel
your permit.

If you intend to perform taxable services (i.e., data processing, word
processing, information services security services, etc.) not related to the
preparation of a document or other record in a civil or criminal suit, you will
still need to retain your sales tax permit and collect and report sales tax on
these sales.

This opinion is based on the facts presented. Other facts though similar may
provide a different result. I hope this information answers your questions. If
you need additional information, please call me toll-free at 1-800-531-5441,
extension 3-4502. The direct line is 512/463-4502. You may also write to Tax
Policy Division, Comptroller of Public Accounts. You may also e-mail our tax
help section at:

Sincerely,

Gilbert Zamora
Tax Policy Division