State Tax Rulings
Free state tax letter rulings and advisory opinions with plain-English summaries, full citations, and the original source on every page.
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Is the Kansas liquor drink tax owed on free alcohol samples served by clubs and drinking establishments?
Kansas Notice 13-09 explains that 2013 House Bill 2199 (effective July 1, 2013) authorizes Class A clubs, Class B clubs, drinking establishments, hotels, and DE/Caterer and Hotel/Caterer licensees to …
When a company contracts for blocks of hotel rooms for its employees, how does Tennessee's 90-day continuous-occupancy exemption work — does it matter which employees or which rooms, and how does the hotel get the tax back?
Tennessee sales tax does not apply to hotel rooms supplied to the same person for 90 or more continuous days (Tenn. Code Ann. § 67-6-205(c)(1)), and the Department explained how that works for a compa…
Were a commercial printer's mailing-list, campaign, and mail-preparation functions a separate BPOL-taxable service business?
No. Nearly every mailing-services customer also bought a printed product from the taxpayer, and combining the services made the printing business more convenient and attractive. The mailing functions …
Did a trial court's reduced restitution order prevent Virginia from collecting the remaining tax, interest, and 100% fraud penalty?
No. Criminal restitution was part of sentencing and did not replace Virginia's separate civil authority to assess all unpaid tax, interest, and the statutory 100% fraud penalty. The taxpayers entered …
Did a taxpayer disprove Virginia's 2005-2010 estimated assessments by claiming another-state residence and denying Virginia rental income?
No. The taxpayer showed an abode and vehicle in another state, but he kept a Virginia post-office box, renewed a Virginia driver's license in 2010, and was linked to multiple Virginia properties. He d…
Can Kansas motor fuel tax be refunded on diesel burned in a truck's diesel particulate filter 'regeneration' cycle?
No. Kansas motor fuel tax paid on diesel consumed in a diesel particulate filter's 'regeneration' cycle is not refundable. K.S.A. 79-3453 refunds fuel tax on fuel used 'for any purpose other than oper…
How must a consolidated corporation calculate income and tax generated by a qualifying project for Florida's Capital Investment Tax Credit?
Use a project-only pro forma income statement under GAAP and Florida taxable-income rules, apportion that income using only project-related factors, and apply the 5.5 percent corporate tax rate to det…
Were deeds, a third-party mortgage and note, and the secured obligation exempt when executed under a confirmed Chapter 11 plan?
Yes. The deeds and financing documents were executed after confirmation and were necessary to consummate the Chapter 11 plan, so documentary stamp and nonrecurring intangible taxes did not apply on th…
Can an Illinois software reseller treat canned-software sales as exempt when the publisher, rather than the reseller, signs the license with the customer?
Yes, potentially. The reseller did not have to be the licensor. If the signed license between the software publisher and the customer met all five requirements in 86 Ill. Adm. Code 130.1935(a)(1), the…
How did Virginia tax security systems that customers self-monitored, the seller monitored regularly, or the parties changed after installation?
A fully self-monitored system was a retail sale of tangible personal property, taxable on the sales price except separately stated installation or a valid exemption. A system regularly monitored by th…
Did buying substantially all assets of a franchised motor-vehicle dealership qualify for Virginia's occasional-sale exemption?
Yes. Although the seller continued a used-vehicle operation, that activity was housed separately, did not use the transferred dealership assets, had no shown economic flow with the dealership, and did…
Was an optional beauty-product protection plan taxable when its benefit was a future gift card rather than repair or replacement?
Yes. The plan differed from a repair or replacement warranty because its benefit was an intangible gift-card right, but that distinction did not make the charge exempt. The optional plan was sold only…
Can a private landfill manager exempt machinery and replacement parts used to reduce air or water pollution at municipally owned Georgia landfills?
Yes, when the private operator purchased, owned, installed, and used machinery, equipment, or replacement parts primarily to reduce or eliminate air or water pollution at Georgia landfills and obtaine…
Can a Louisiana tax credit still reduce tax for a prescribed period, and does an IRS adjustment reopen unrelated issues?
A credit could reduce the computed tax to zero, but any excess could not be refunded or carried to another period after the overpayment claim period prescribed. An IRS adjustment reopened only related…
What Virginia tax interest rates applied during the third quarter of 2013?
Virginia's third-quarter 2013 rates were 5% for tax underpayments and 5% for tax overpayments. The reduced rate for qualifying assessments under administrative appeal was 0% after the statutory nine-m…
Could a telecommunications provider exclude its local BPOL tax from the sales price subject to Virginia communications sales tax?
No. BPOL tax is imposed for the privilege of doing business in a locality; it is not a tax on the customer's purchase, sale, use, or consumption of communications service, and it is not a government f…
How did Virginia's revised 2013 guidelines implement the statewide and regional retail sales and use tax changes?
The historical guidelines raised Virginia's total statewide retail sales and use tax rate from 5.0% to 5.3% on July 1, 2013 and imposed a 0.7% regional tax, for a 6.0% total rate, in specified Norther…
Did Virginia's additional 0.7% Hampton Roads sales tax apply in Gloucester and Surry Counties on July 1, 2013?
No. Tax Bulletin 13-8 said Gloucester and Surry Counties were members of the Planning District 23 Commission but were not located in Planning District 23, so the additional 0.7% regional tax did not a…
Was a per-gallon fuel flowage fee required by a fuel-farm ground lease taxable as rent?
Yes. The flowage fee was consideration for the right to use the leased property because nonpayment was a default that could terminate the lease, even though the agreement did not label the fee as rent…
Are pressure washers and their repair parts exempt when used to clean farm or cotton-gin equipment and purchased with a GATE certificate?
Yes. Cleaning equipment used to repair or maintain general farm equipment or cotton-gin machinery qualified as agricultural machinery, and installed repair or replacement parts for that cleaning equip…
Are hearing-aid batteries exempt from Georgia sales tax when sold with a hearing aid or separately as replacement batteries?
Yes. Although the hearing-aid statute did not expressly mention repair or replacement parts, the Department treated its scope like the exemptions for durable medical equipment and prosthetic devices a…
May a Georgia seller limit direct customer sales-tax refunds to 90 days and require later exemption claims to be filed with the state?
Yes. The seller could require full invoice payment, review late exemption certificates, refund or adjust tax for requests within 90 days, and direct later claims to the Department with the seller's co…
How should a veterinary and farm-supply seller apply Georgia's GATE exemption to agricultural inputs, equipment, and related products?
Qualifying agricultural production inputs, agricultural energy, and machinery or equipment could be sold tax-free when the seller accepted a valid GATE certificate in good faith. The Department did no…
How did Illinois distinguish a taxable $1-purchase-option equipment lease from a true lease with a fair-market-value buyout?
A lease with a nominal or $1 purchase option generally was a conditional sale, making all contract receipts subject to Retailers' Occupation Tax. A lease retaining a fair-market-value buyout could rem…
When may a South Carolina retailer deduct a customer's bad debt on a sales or use tax return?
A retailer may deduct the taxable sales price it previously reported and paid tax on when that receivable becomes worthless and qualifies as a bad debt for state income-tax purposes. The deduction exc…
When did Virginia accept or reject exemption-certificate support for a technology seller's audited sales?
Virginia granted partial relief. It removed Customer A sales made after a complete resale certificate was accepted in good faith and removed Customer C sales supported by a Department authorization le…
Did an active-duty service member owe Georgia use tax on a European vehicle imported under orders before the title ad valorem tax took effect?
Yes. The vehicle entered Georgia before the March 1, 2013 title-tax change, no sales or use tax had been paid elsewhere, and the service member retained a non-Georgia home of record, so the exemption …
Must a nonprofit lounge collect Georgia sales tax on food, beverages, tangible goods, and admissions sold to members or the public?
Yes. Nonprofit status did not exempt the lounge's retail sales of food, beverages, tangible personal property, or admissions. It had to collect and remit tax using Form ST-3, but it could buy inventor…
May a cash-management provider charge one nontaxable service fee when it retains title to equipment placed at customer sites?
Yes. The single charge for secure transportation and cash-management services was not taxable because the provider retained title to and intended to recover the equipment and paid tax as its consumer.…
May a dental lab sell prescribed appliances, caps, coverings, and prostheses to dentists tax-free without Form ST-5?
Yes. Dental appliances, caps, coverings, and prostheses that could be sold or used only under a dentist's prescription were exempt prosthetic devices, including related fabrication and delivery charge…
How did Georgia's 2013 TSPLOST transition apply to motor-vehicle lease payments, moves between counties, and the $5,000 cap?
Under the 2013 transition rules, TSPLOST was collected on periodic lease payments rather than fully upfront, up to $5,000 of aggregate payments, and followed the vehicle's registration county when the…
Is a Georgia gunsmith's firearm transfer fee taxable when the gun was purchased from an out-of-state seller?
No, when the Georgia gunsmith neither sold the gun nor took payment for it. The transfer fee was a nontaxable service fee because Georgia statutes did not identify it as taxable. If the gunsmith itsel…
Could a direct-sales company file and remit Illinois sales tax for its independent consultants, and where did 2013 home-party and website sales go on the return?
Yes, if IDOR accepted an RR-80 agency agreement under 86 Ill. Adm. Code 130.550. The company could then collect and remit tax on its consultants' ultimate retail sales, while consultants generally wou…
Could a taxpayer challenge a Virginia sales-tax assessment after the 90-day appeal deadline and avoid the post-amnesty penalty?
No. The assessment was dated September 6, 2012, making the complete administrative appeal due December 5, 2012, but the Department received the taxpayer's only appeal correspondence on April 16, 2013.…
Could a Virginia resident obtain out-of-state tax credits without filing Virginia returns for 2007 and 2008?
The taxpayer first had to file Virginia returns. She conceded Virginia domicile and supplied other-state returns but had filed no Virginia return for 2007 or 2008. The Department required both Virgini…
Did a Foreign Service employee change domicile from Virginia to another state before moving overseas?
Not on the evidence submitted. The employee cut Virginia ties and obtained a license, vehicle registrations, and voter registration in another state, but moved from Virginia to an overseas post withou…
Could a county tax all machinery at a plant that continued limited operation briefly after its announced shutdown?
Not on the record presented. Although the manufacturer's March 2010 shutdown notice may have been inaccurate because some equipment operated briefly into January 2010, the Department found that some o…
Was a nonqualified pension distribution taxable by Virginia when it was earned before the taxpayers moved but paid afterward?
Yes. Although the husband's lump-sum nonqualified pension was earned and payable before the couple moved to Virginia, it was actually distributed in April 2010 after they became Virginia residents. Th…
Could taxpayers obtain a Virginia refund by filing their original 2008 part-year return after the extended due date?
No. The taxpayers filed their original 2008 part-year Virginia return on May 22, 2012, after both the extended filing deadline and the three-year refund period measured from the May 1, 2009 original d…
Did a Foreign Service officer retain California domicile or abandon Virginia domicile during an overseas assignment?
No. Virginia found that the officer abandoned California domicile and established Virginia domicile after moving, buying a home, registering a vehicle, obtaining and renewing a Virginia license, and f…
Were a ready-mix concrete seller's delivery and fuel surcharges and Virginia pickup of skid-steer equipment tax-exempt?
No. Virginia upheld tax on the ready-mix seller's delivery and fuel surcharges because mixing and processing continued in the truck until the concrete reached the job site, making the charges part of …
Could an Illinois retailer refund tax after receiving a late exemption certificate and simply adjust its next return, or send the customer to IDOR?
No. After refunding the tax to its customer, the retailer could not merely adjust the next return. It had to file a claim for credit under 86 Ill. Adm. Code 130.1501. Only the person that actually pai…
Could taxpayers apply a late-filed 2008 overpayment to 2009 after Virginia's refund limitations periods expired?
No. The taxpayers filed the 2008 amended return in October 2012, after the general three-year period and every applicable statutory exception had expired. Calling the requested relief a credit against…
Did a service member's statement that the military treated another state as home prove her 2009 military pay was exempt from Virginia tax?
Not by itself. The Servicemembers Civil Relief Act protected an existing domicile from changing solely because of military orders, but the taxpayer had filed a Virginia resident return, reported civil…
Did Virginia tax a nonresident interstate truck driver's wages and sole-proprietor owner/operator service fees?
Generally no, for the compensation described. Federal law barred Virginia tax on the nonresident employee's interstate motor-carrier wages and also treated qualifying transportation-service fees paid …
Did moving abroad and qualifying for the federal foreign-earned-income exclusion end the taxpayers' Virginia domicile?
No. Although the couple lived and worked indefinitely in another country, they kept a Virginia home, vehicles, voting ties, and renewed Virginia driver's licenses, and later claimed Virginia residency…
Could a taxpayer undo her 2009 Virginia resident return without clearly documenting where she lived and established domicile?
Not on the evidence submitted. The taxpayer had some ties to another state but retained a Virginia driver's license until October 2009, filed a full-year Virginia resident return, and had Virginia tax…
Did an other-state return and surrender of a Virginia license prove that a taxpayer changed domicile before 2009?
Not by themselves. The taxpayer filed a 2009 return in another state and had surrendered her Virginia driver's license in August 2008, but she did not provide the additional records Virginia requested…
Could an out-of-state partnership use separate accounting instead of Virginia's statutory apportionment formula for 2012?
No. The partnership showed only that separate accounting produced a different result after an out-of-state real-estate sale. It supplied no clear and cogent evidence that Virginia's formula was uncons…
Were no-charge oil and filter changes under a manufacturer's scheduled-maintenance warranty subject to Virginia retail sales tax?
No. The vehicles' manufacturer package covered scheduled maintenance for two years or 25,000 miles, and customers paid nothing when oil and filters were replaced. Virginia treated the work under its w…
Could an electrical contractor rely on the wrong type of NTTC when it accepted the completed certificate on time and in good faith for otherwise deductible construction work?
Yes, for the President Homes receipts. Rio Grande Electric timely accepted a completed Type 2 NTTC in good faith for electrical work that the Department agreed would otherwise qualify for a constructi…
When did the Kansas state sales and use tax rate change to 6.15%, and how do transition rules apply?
Kansas Notice 13-08 (June 6, 2013), which revokes and replaces the erroneous Notice 13-07, explains that 2013 House Bill 2059 changed the Kansas state sales and use tax rate from 6.3% to 6.15% on July…
Could a New Mexico grain hauler deduct intrastate deliveries from a railhead to farms by assuming they were part of an interstate shipment under one contract?
No. Wesley Miller hauled grain from an Albuquerque railhead to central New Mexico farms as a subcontractor for his father. Section 7-9-56 allowed an intrastate leg only when it was part of interstate …
Must the Kansas expensing deduction be added back when figuring income for a homestead refund?
Kansas Notice 13-06 explains that the Kansas expensing deduction cannot be used to reduce 'income' for homestead property tax refund purposes. 'Income' for a homestead claim is defined in K.S.A. 79-45…
Were a psychologist's 2005-2006 contract services to a school district exempt under New Mexico's later rural-health and medical-services tax provisions?
No. Ann Lodge provided contract psychology services to the Los Lunas School District in 2005 and 2006 but filed no gross receipts tax returns. The rural-health credit and expanded medical-services ded…
Could a shuttle company treat its drivers as independent contractors without contracts, tax forms, or payment records?
No. The shuttle service supplied no contracts, Forms W-2 or 1099, employment forms, individual driver records, or payment documentation supporting independent-contractor status. Virginia therefore tre…
Could a convenience store overturn local BPOL and business-property assessments without producing complete records?
No. The store repeatedly failed to supply complete cash-register tapes and other records needed to reconcile BPOL gross receipts, and it supplied no contracts proving vendors owned assessed display ca…
Did an Acute Care Expense Limitation pricing arrangement prevent patient-specific specialty-bed leases from being exempt?
No. Although the supplier used an Acute Care Expense Limitation program and maintained a bulk inventory, physician work orders named the patients and monthly invoices tracked the beds and days of use.…
Were specialty beds leased under a flat CAP pricing program exempt when physician records identified each patient?
Yes. The supplier's flat CAP pricing and bulk inventory did not control the exemption. Licensed physicians issued work orders naming the patients, and monthly lease records tracked the beds and patien…
Did CAP pricing and supplier inventory prevent specialty-bed leases from qualifying as patient-specific exempt equipment?
No. The flat CAP pricing method and supplier-owned bulk inventory did not defeat the exemption because physician work orders and lease records tied the specialty beds to specific patients. Virginia re…
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