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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I run trucks that only haul household goods for moving customers. Are those vehicles exempt from New York's Highway Use Tax?
Yes. New York's Highway Use Tax (Tax Law § 503.1) applies to operating a vehicle on the state's public highways, but § 504.5 exempts any vehicle used exclusively to transport "household goods" by a ca…
Is a separately stated fee to read the meter on a customer's propane tank subject to Colorado sales tax?
It depends on the customer, and the Department made no binding determination on separability. A fee to read the meter on a propane tank is NOT taxable when the gas sale itself is exempt—Colorado exemp…
Are an FCC-license fee and a 'coordination fee' that a two-way-radio distributor charges its customers subject to Colorado sales or use tax?
It depends, and the Department made no binding determination. FCC-license and 'coordination' fees a distributor bills along with two-way radios are TAXABLE if either (1) the radio service qualifies as…
Could an expanding Florida manufacturer authorize its contractor to buy materials tax-exempt for a processing line, dedicated structure, and chemical tanks?
Yes. The manufacturer could name the contractor on a copy of its temporary tax exemption permit, and the contractor could give that permit to vendors for qualifying machinery, parts, and materials tha…
Did transferring real property to a Florida land-trust trustee owe only minimum documentary stamp tax when the transferor kept all beneficial ownership?
Yes. The timeshare developer transferred property to a Florida land-trust trustee for no consideration and immediately remained the sole owner of every beneficial interest. Because the deed changed le…
Does a lender's forgiveness of the seller's remaining mortgage debt increase Florida documentary stamp tax on a short-sale deed?
No, under the arm's-length facts presented. The deed-tax consideration was the $335,000 paid by or for the buyer. The lender's separate cancellation of the seller's remaining debt was not consideratio…
Could Florida hotels include communications services tax in one combined pay-per-view charge instead of separately stating the tax?
Yes. The pay-per-view provider could combine communications services tax with its programming charge when billing participating lodging establishments, provided each establishment was licensed under C…
When was customized medical practice software—and its maintenance—subject to Florida sales tax?
Custom medical practice software sold by itself was a nontaxable service, and maintenance covering only that custom software was also nontaxable. But when the same custom work was sold with taxable ha…
How long does a taxpayer have to file a petition for redetermination to contest a Nebraska Notice of Deficiency Determination?
Generally 60 days from the postmark date. Revenue Ruling 99-09-1 explains that, under 2008 Legislative Bill 914, the period to file a petition for redetermination contesting a Notice of Deficiency Det…
My organization is a certified tax-exempt fraternal insurance company, but I sell discounted books and gifts to members by phone/Internet through a 2008 law change targeting 'remote sales' — do I now have to collect New York sales tax on those sales?
Yes, must collect. A New York fraternal insurance company that is otherwise a certified tax-exempt organization must still collect and remit sales tax on its regular phone/Internet retail sales of boo…
I manufacture goods and sell them for resale to retailers under resale certificates, but sometimes the retailer's own customer pays part of the price directly to me instead of to the retailer — does that direct payment turn into a taxable sale by me?
No new sale. A window-treatment manufacturer that sells to retailers for resale (properly documented with resale certificates) does not make a new taxable sale, and owes no sales tax, when a retailer'…
Can a corporation or LLC claim Colorado's nonresident temporary-use exemption on an aircraft or vehicle used briefly in Colorado, and can a Colorado resident avoid use tax on an out-of-state vehicle driven into the state?
The nonresident temporary-use exemption (§ 39-26-713(2)(c)) applies only to individuals, not to corporations or LLCs — so an out-of-state corporation's aircraft used in Colorado owes Colorado use tax …
A condo developer paid sales tax when it bought furniture, then sells the furnishings to fractional-interest buyers with the units—does it owe sales tax again on that sale, and is that double taxation?
Yes, the sale to fractional-interest buyers is a taxable retail sale of tangible personal property—even though the developer already paid sales tax when it bought the furniture. The developer is actin…
When a contractor incorporates its own materials into Colorado real property, is the fee paid to a third-party fabricator excluded from the use tax on those materials?
It depends on whether the fabricator also sold the materials. A contractor that buys materials out of state and incorporates them into Colorado real property is the consumer and owes use tax on its ac…
When a company sells taxable equipment below its cost to get customers to sign up for a non-taxable service, is sales tax based on the low price the customer pays or on the company's cost?
On the company's cost, not the low price the customer pays. When a company sells taxable equipment below its acquisition cost as an inducement to buy a non-taxable service, Colorado sales tax is compu…
Could a Virginia corporation allocate outside the state income from a 50%-owned partnership operating only in another state?
Not on the evidence provided. Virginia generally treated partnership income as operational and apportionable, including the partner's share of partnership property, payroll, and sales. The corporation…
Did a traveling artist abandon Virginia domicile by owning homes and studios elsewhere while retaining a Virginia home, license, and voter registration?
No. Despite homes, studios, vehicles, and business ties in other states, the artist kept a preexisting Virginia residence, renewed a Virginia driver's license in 2003, remained registered to vote, con…
Were an RFID system vendor's bundled design, testing, training, and implementation charges taxable with the hardware under Virginia's true-object test?
Yes. Virginia found that the contracts' true object was the tangible RFID system, so the design, development, testing, training, and other implementation services were taxable as components of the sys…
Were Internet-downloaded music and a shower chair sold to an individual exempt from Virginia sales tax?
Yes. Documented music downloads were nontaxable Internet-delivered service transactions, and the shower chair qualified as durable medical equipment because shower seating was listed in the regulation…
Did Kansas's Washburn University retirement subtraction cover both the basic plan and supplemental annuity, including funds rolled into the Washburn plan?
Yes. Qualifying benefits received on or after January 1, 2008 from either Washburn University's basic 403(b) retirement plan or its supplemental retirement annuity were eligible for the K.S.A. 79-32,1…
How does Kansas sales tax apply to equipment, replacement parts, and electricity sales for a Kansas wind farm?
Replacement parts and repair services for wind-farm equipment take the same sales-tax treatment as the underlying equipment: if the equipment purchase is exempt under K.S.A. 79-3606(kk), the parts and…
My company prints and mails direct-mail advertising coupons for local merchants from an out-of-state printing plant to addresses all over the country, including New York -- do I owe New York sales or use tax on the mailings that go to New York addresses?
Mostly exempt. A national direct-mail advertiser's printed coupon materials, produced and mailed out of state to New York recipients on behalf of its franchisees' advertiser-clients, are exempt promot…
Were customized insurance software delivered electronically and its required support-and-maintenance agreement subject to Florida sales tax?
No. Although the vendor began with a base insurance system used by multiple customers, it extensively modified this customer's screens, forms, reports, database functions, rating features, and park-fi…
What Virginia tax interest rates applied during the first quarter of 2009 to assessments, refunds, estimated-tax additions, and local taxes?
For January 1 through March 31, 2009, Virginia's state interest rates were 7% for tax underpayments and assessments and 7% for tax overpayments and refunds, reflecting federal 5% rates plus two percen…
Are specialty therapy mattresses (low-air-loss, pressure-relieving, turning, bariatric), HI/LOW and bariatric bed frames, and wheelchairs subject to Colorado sales tax?
It depends on the item. Colorado taxes tangible personal property, but the medical exemption specifically covers wheelchairs and hospital beds. Therapeutic devices, appliances, and related accessories…
Does the federal Public Law 86-272 solicitation-only protection apply to S corporations, LLCs taxed as partnerships, and their owners for New York corporate franchise and personal income tax?
Yes, with limits. An S corporation whose only New York activity is soliciting orders is protected by PL 86-272 - which also makes it ineligible to be a New York S corporation, so nonresident sharehold…
My client manufactures displays in New York and sells FOB origin, with the customer's own common carrier picking them up at our dock -- do we still owe New York sales tax based on where the carrier ultimately delivers them, even though title passed at our loading dock?
Taxed at the delivery destination, not the dock. A New York display manufacturer selling FOB origin, where title passes to the customer at the company's own loading dock, must still collect New York s…
My client's records-retrieval business gets authorized requesters copies of their own confidential medical records, tax returns, or Social Security statements from the actual custodians -- are those retrieval fees subject to New York sales tax?
Not taxable, with one exception. A records-retrieval company's fees for obtaining and delivering an individual's own specifically-identified confidential medical, tax, or Social Security records -- us…
My catering company and a commonly-owned event-rental affiliate often work the same events for the same clients but bill separately -- can the affiliate keep using resale certificates with its vendors even though we're related companies?
Yes, as long as they're genuinely separate. A commonly-owned affiliate of a catering company that independently sells and rents event items (tents, flowers, entertainment) to the same customers at the…
Is the electricity a wireless carrier uses at its Connecticut cell sites exempt as manufacturing utility use?
No. Electricity a wireless carrier uses at its Connecticut cell sites to transmit signals is not exempt under Conn. Gen. Stat. § 12-412(3)(A). That exemption covers electricity used directly to fabric…
What is South Carolina's tax interest rate for the period January 1, 2009 through March 31, 2009 (per SC IL #08-25)?
5%. SC Information Letter #08-25 sets South Carolina's interest rate on tax underpayments and overpayments at 5% for the period January 1, 2009 through March 31, 2009. Interest is compounded daily, ex…
What cigarette-stamp penalties and challenge procedures did Virginia announce effective December 1, 2008?
Virginia announced a graduated enforcement schedule for retailers and wholesalers that were not stamping agents and held fewer than 3,000 unstamped packs: a warning for 1-30 packs, $50 per pack for 31…
Are medical diagnostic test kits—a flu A+B test, an RSV test, and an hCG urine test—subject to Colorado sales or use tax?
The Department gave the framework, not a firm answer. Colorado taxes tangible personal property unless exempt (§39-26-104), and several medical exemptions can apply to diagnostic products—prescription…
What percentage of a four-floor Florida hotel's master-lease rent was taxable after excluding guest rooms and no-charge amenities?
Florida accepted 3.49% as the taxable portion using the taxpayer's unverified measurements: 4,001 square feet of hotel operational areas divided by 114,535 total square feet. Guest rooms and no-charge…
What portion of a fully re-leased Florida hotel property was taxable operational space, and which lease bore the tax?
Florida accepted 2.81% as the taxable hotel-space share: 2,227 square feet of operational areas divided by 79,279 total square feet. Guest rooms and no-charge guest amenities were excluded, as was the…
What share of a four-floor Florida hotel's master-lease rent was taxable based on back-of-house versus guest-use square footage?
Florida accepted 4.21% as the taxable share using the taxpayer's unverified figures: 4,845 square feet of back-of-house operational space divided by 115,061 total square feet of land and hotel floors.…
What percentage of a ground-leased Florida hotel was taxable commercial space rather than exempt guest and common areas?
Using the taxpayer's unverified measurements, Florida accepted 4.07% as the taxable portion: 3,335 square feet of back-of-house hotel space divided by 81,893 total square feet. Guest rooms and no-char…
Did a Virginia affiliated group elect consolidated filing when its first return checked 'combined' but was computed and later filed consistently as consolidated?
Yes. Although the affiliated group's initial return checked the 'combined' box, it was computed using the consolidated method and the group consistently filed consolidated returns afterward. Virginia …
How did Florida tax an event planner's payments to a venue and the wedding packages it sold to clients?
The planner's per-attendee payments, show allocations, security fees, revenue percentage, and minimum payments to the venue were all taxable rent for a real-property license. The planner's wedding and…
Under Virginia's 2009 household-employer rules, who could elect annual income-tax withholding and what filing steps applied?
For wages paid on or after January 1, 2009, a household employer could elect annual Virginia income-tax withholding if employment consisted exclusively of household service in the employer's private h…
Was a Medicare Part D plan administrator exempt from Virginia corporate income tax when its premiums were federally exempt from gross-premiums tax?
Virginia did not decide whether the company was subject to gross-premiums tax; that determination belonged to the Bureau of Insurance. If the Bureau found the company subject to that tax, it would be …
How did Virginia resolve a government contractor's challenges to audit sampling, purchase exceptions, purchasing-agent status, penalty, and interest?
Virginia partly granted the appeal. It allowed the audit sample to be revised if the contractor supplied records for the commercial-contract portion, corrected several invoice and sample errors, and w…
What was Kansas's petroleum-products inspection fee on gasoline and diesel beginning January 1, 2009?
Kansas reduced the petroleum-products inspection fee on gasoline and diesel to $0.0135 per barrel effective January 1, 2009, down from the $0.015 statutory rate stated in K.S.A. 55-426. For this fee, …
Did an excellent payment history and a Thanksgiving-related delay excuse penalty and interest when a cigarette distributor sent its stamp payment after the deadline?
No. Core-Mark sent its $22,318,843.82 cigarette-tax-stamp payment on November 27, 2007, one day after the Sunday-adjusted deadline. Its excellent payment history and the unavailability of an officer n…
Are downloadable wallpaper, games, ringtones, and ringback tones sold by a mobile phone carrier subject to New York's utility tax, telecommunications excise tax, or sales tax?
Mostly no, with one exception. A carrier that separately and reasonably bills for wallpaper, games, ringtones, and ringback tones can exclude them from the section 186-a utility tax, the section 186-e…
I sell access to hosted image-editing software that lets customers upload and manipulate product photos on my servers — no software is ever downloaded to the customer. Do I still owe New York sales tax on the license fees?
Yes, taxable. Adobe Systems Inc.'s annual license fees for its "OnDemand ASP Software" — a hosted product that lets customers upload and manipulate product images on Adobe's own out-of-state servers, …
Are aircraft deicing services billed to commercial air carriers subject to Kansas sales tax, or exempt?
Taxable. Charges billed to commercial air carriers for aircraft deicing are taxable in Kansas as "application services" under K.S.A. 79-3603(p). None of the three possible exemptions applies: the 2004…
Is an insurance company exempt from Colorado corporate income tax because it is 'subject to' the gross premium tax, even though all of its premiums are exempt from that tax?
Yes, exempt. The company is an insurance company that falls within Colorado's gross premium tax statute, so it is 'subject to' that tax and therefore exempt from Colorado corporate income tax — even t…
I run a portable moving-and-storage-container business with a long list of separate charges — delivery, moving, storage, damage waivers, cleaning, repairs, supplies — which of these actually owe New York sales tax?
It splits by charge type. A portable storage container company's charges for the container rental itself, for storage at the dealer's warehouse (and access to it), for moving to/from that warehouse, f…
Could a therapy provider deduct receipts from services sold to New Mexico public schools by accepting Type 9 government NTTCs?
No. The government-sales deduction in Section 7-9-54 covered tangible personal property, while Cumberland sold psychology, social work, occupational, physical, and speech-language therapy services. Th…
Can local 501(c)(4) civic clubs claim Utah's sales tax exemption for charitable institutions, either on their own or by using a related 501(c)(3) foundation's exemption number?
No, not on their own. Utah's charitable sales tax exemption (§ 59-12-104(8)) is limited by Rule 43A to organizations the IRS recognizes under 501(c)(3) — a 501(c)(4) organization doesn't qualify, even…
Which Kansas monthly reports changed for cigarettes and roll-your-own tobacco from non-participating manufacturers beginning in December 2008?
Beginning with the December 2008 reporting period, Kansas cigarette wholesalers and tobacco distributors had to use a revised Form CG-30 or new Forms TB-31 and TB-34 when applicable. CG-30 added origi…
Does a mechanical amusement device with multiple playing stations need a separate tax decal for each station?
Yes -- a decal is required for each playing station. Revenue Ruling 54-08-1 (which supersedes Revenue Ruling 54-90-1) concludes that under the Mechanical Amusement Device Act (Neb. Rev. Stat. §§ 77-30…
I supply merchandise to mall kiosk operators who are independent contractors, and their credit card sales get deposited into my account while they keep their own cash sales — who has to collect and remit the sales tax, and does it matter whether the customer paid cash or credit card?
The supplier collects either way. A distributor that supplies merchandise to independent-contractor kiosk/cart operators ("lessee-vendors") in shopping malls is a "co-vendor" that must pre-collect New…
How does Kansas sales tax apply to a fire-sprinkler contractor's materials and labor across new construction, remodeling, service, and inspections?
Contractors pay Kansas sales or use tax as consumers on the materials and supplies they buy, and collect sales tax as retailers on taxable labor. All construction labor on residential property is exem…
Are a hedge fund general partner's operating and overhead costs - including employee compensation paid for under a partnership agreement - deductions attributable to business capital or investment capital under Article 9-A?
Business capital, to the extent the costs are covered by the management fee. The management fee is business income, and a written-agreement election lets the general partner irrebuttably presume the r…
My family-owned ferry company runs the only vehicle ferry between two New York towns, is regulated by the county, and serves as an emergency evacuation route -- can we get a refund or credit of the sales and use tax we've paid on our ferry boats?
No refund under the old rule, but a new exemption applies going forward. A private, county-regulated vehicle ferry company does not qualify for the long-standing local-transit-vessel refund in Tax Law…
My client rents portable storage units and separately offers an optional transportation service to move the loaded unit to a new location, billed separately whether under the standard rental agreement or a standalone transportation contract -- is that optional moving fee taxable?
Rental is taxable, optional moving fee is not. A portable storage container company's basic rental, pickup, delivery, and warehouse-storage charges are all taxable as a rental of tangible personal pro…
My property is undergoing state-mandated environmental remediation for old oil-tank contamination -- can I treat the remediation contractor's charges as an exempt capital improvement instead of a taxable maintenance service?
Taxable, with a possible later refund. Environmental remediation work -- excavating and removing petroleum-contaminated soil, installing monitoring wells, and backfilling with clean soil under a state…
Could a multilevel LLC structure disproportionately allocate, warehouse, and later sell downtown historic rehabilitation credits while observing the $5 million taxpayer cap?
Yes on the stated agreements. Pass-through entities could allocate credits disproportionately and in later years within the original five-year carryforward. The $5 million district cap applied to each…
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