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 an out-of-state corporation whose only New York activity is a researcher it hired to work at a New York university subject to New York Article 9-A franchise tax?
It depends on the worker status. If the New York researcher is the corporation's employee, that activity is doing business in New York and the corporation owes Article 9-A franchise tax and must file …
Is a Texas parent that runs payroll for its New York operating subsidiary subject to New York Article 9-A franchise tax?
It depends on whose employees the New York workers are. A Texas parent that handles payroll for its New York operating subsidiary (PPNY) under the parent's federal EIN is subject to Article 9-A only i…
Can a single-member LLC or its corporate owner claim New York Brownfield Cleanup Program tax credits, and when, if costs are incurred or property is placed in service before the program's first effective year?
Yes, the corporate owner claims them. If the LLC is disregarded, it is a branch or division of its owner, so the owner (taxable under Article 9-A) claims the brownfield redevelopment credit (site prep…
Is an out-of-state ready-mix concrete seller that delivers to New York in its own trucks protected by Public Law 86-272?
Yes, if the concrete is central-mixed. An out-of-state seller whose New York activity is a phone listing and delivery of central-mixed (plant-mixed) concrete in its own trucks -- where the slow drum r…
Which fuel sales counted as aviation gasoline whose South Carolina sales and use tax was credited to the State Aviation Fund?
Qualifying fuel included aviation gasoline meeting ASTM D 910 and civil aviation turbine fuel meeting ASTM D 1655, but the sales and use tax was credited to the State Aviation Fund only when the fuel …
Is a political action committee (PAC) exempt under IRC Section 527 also exempt from Texas franchise tax?
No. A political organization or PAC that is exempt under Internal Revenue Code Section 527 does not qualify for exemption from the Texas franchise tax. The franchise tax is imposed on corporations and…
How much of a construction loan secured by a 99-year leasehold mortgage was subject to Florida's nonrecurring intangible tax?
Only the portion secured by Florida real property was subject to the one-time 2-mill tax. Because the mortgage included land, buildings, and improvements as collateral, the note had to be allocated be…
Could taxpayers recover a $371 New Mexico income-tax overpayment when the Department failed to credit their estimated payment but they did not act within 210 days after filing the refund claim?
No. The Department mistakenly failed to credit the Mortensens' $1,600 estimated payment, creating a real $371 overpayment once its records were corrected. But it took no action on their April 2002 ref…
Could a long-time Florida consolidated group switch to separate returns after divesting business lines, changing markets and operations, and growing substantially?
Yes. The Department found that the group's divestitures, changed market segments, new operating model, and substantial growth materially changed the circumstances of its old election. It approved sepa…
Which advertising inserts and insert envelopes distributed with a free mailed shopper qualified for Florida's publication sales-tax exemption?
Only inserts and envelope packages bearing the Shopper branding statement qualified. An in-home date or a date plus internal Version ID did not label the item as part of the publication. Qualifying in…
How should a hotel operator allocate its lease payment between taxable administrative space and exempt guest dwelling and common areas?
Use total rent multiplied by a fraction: hotel-only taxable space in the numerator and all leased floors plus all leased land in the denominator. Guest rooms and guest common areas were excluded; empl…
Did Florida sales or use tax apply to materials received briefly in Florida for packaging and shipment to foreign installation sites?
No, on the documented facts. Although taking possession in Florida created a presumption of taxability, the taxpayer rebutted it by tying each purchase to a foreign installation contract, briefly pack…
How did repealed Louisiana Revenue Ruling 05-001 distinguish repairs to movable property from repairs to immovable property?
Historically, movable-property repairs were taxed on the full charge. Immovable-property repair service was not taxed; depending on title and invoicing, parts were either sold to the customer as movab…
How does Kansas tax a Missouri company's rentals of party equipment to caterers and customers across the state line?
Rentals to caterers are taxable, and the delivery point controls which state's tax applies. A caterer is treated as using rented tables, chairs, tents, and tableware to provide its service, not resell…
Are labor charges for repairing or installing oil and gas field pipelines and storage tanks taxable in Utah?
No, not anymore. The Utah Tax Commission had previously told the industry (through several private letter rulings, a publication, and a presentation) that labor charges to repair or install oil and ga…
Was a church's transfer of unencumbered real property to its wholly owned nonprofit LLC subject to documentary stamp tax?
No. The Florida Department of Revenue treated the church's conveyance of unencumbered real property to its wholly owned section 501(c)(3), nonprofit LLC as a gift made for no consideration. The LLC ga…
Could a county buy public-works construction materials tax-free under its proposed direct-purchase procedures?
Conditionally yes. The Florida Department of Revenue found that the county's direct-purchase exhibit could support tax-exempt purchases if the contract was amended so the county, not the contractor, a…
Did a property manager resell goods to its clients when it ordered items that vendors delivered directly to them?
No. Under the described arrangements, the Florida Department of Revenue treated the property manager as ordering goods and services as agent for its clients rather than buying and reselling them. Vend…
How must a Texas seller-finance vehicle dealer allocate and remit motor vehicle sales tax across the down payment and installments?
The dealer had to calculate total tax, collect the tax attributable to the down payment, subtract it, and divide the remaining tax equally among the scheduled installments. The Comptroller rejected a …
Were two regularly published, free, primarily advertising magazines exempt from Florida sales and use tax?
Yes, on the facts and samples reviewed. The Florida Department of Revenue concluded that the publisher's two publications qualified under section 212.08(7)(w) because they were published regularly, di…
Must a tax-exempt golf association collect sales tax on U.S. Open spectator admissions, hospitality tent/table packages, concession and mail-order merchandise sales, and can it use tax-included pricing?
Yes to admissions: spectator tickets to the U.S. Open golf tournament are taxable admission charges, and a hospitality package's charge in excess of the admission price is exempt as space rental only …
Can a contractor buy materials tax-free for a political subdivision's construction project by routing purchases through an affiliated purchasing company?
Not by itself. When a construction joint venture (a contractor plus an affiliated purchasing company) contracts with a Kansas political subdivision, the Department looks at the substance: it is a cons…
Are sales commissions a mobile phone carrier pays to its equipment-selling affiliate for signing up customers taxable, and can that affiliate buy discounted phones tax-free as inventory for resale?
Sales commissions that a mobile phone service provider pays its affiliated equipment seller for signing up or renewing customer service contracts aren't taxable at all — they're not a sale of property…
Was a separately stated newspaper carrier-delivery charge taxable when subscribers could avoid it?
No. The Florida Department of Revenue ruled that the newspaper publisher did not have to collect sales tax on an independent-carrier delivery charge when subscribers were told at the initial subscript…
Was a separately stated newspaper carrier-delivery charge taxable when subscribers could avoid it?
No. The Florida Department of Revenue ruled that the newspaper publisher did not have to collect sales tax on an independent-carrier delivery charge when subscribers were told at the initial subscript…
Is laser and IPL hair removal performed by trained but unlicensed technicians in a New York City clinic subject to the city's local sales tax on electrolysis services?
Yes, but only the New York City local tax applies, not New York State tax. Laser and IPL hair removal is similar enough to electrolysis that New York City's local tax on electrolysis and similar cosme…
Can a Qualified Empire Zone Enterprise construction contractor buy tool trucks, cranes, and related equipment tax-free when they spend most of their time at out-of-zone construction sites rather than in the zone yard?
It depends on how each piece of equipment is actually used, not where it's parked. Tool trucks qualify for the QEZE sales tax exemption if at least 50% of their trips originate or end in the empire zo…
Were a utility's monthly charges for voltage-transformation facilities subject to Florida sales and gross receipts taxes?
Yes. Revised TAA 97A-032R treated monthly facilities charges for utility-owned voltage-transformation equipment and related service as charges for providing electric energy, reversing the original TAA…
Did a Florida city's sale of fill material to a developer qualify as an exempt occasional sale?
No. The Florida Department of Revenue concluded that the city's sale of fill material to the developer did not qualify as an exempt occasional sale. Section 212.06(15)(b) required a contractor obtaini…
Which foundations, production-support systems, HVAC components, and electrical costs at a new newspaper plant qualified for Florida's expanding-business exemption?
The Florida Department of Revenue found that eighteen systems at the approved expanding newspaper-printing facility qualified fully or partly as exempt machinery and equipment. Fully qualifying items …
Were interests in a series trust exempt from Florida intangible tax when at least 90% of net assets were exempt?
Yes. The Florida Department of Revenue concluded that shares, units, or other undivided interests in the described trust were exempt when at least 90% of the trust's net asset value consisted of asset…
Was a newspaper's separately stated carrier-delivery charge taxable after subscribers received pickup and mail options?
No. Under the publisher's revised billing procedure, Florida sales tax did not apply to the independent-carrier delivery charge when subscribers were told at the initial subscription or renewal about …
Did a school board's owner-direct-purchase procedures qualify construction materials for Florida's government sales-tax exemption?
Yes. The Florida Department of Revenue found that the school board's owner-direct-purchase procedures made the board the purchaser of construction materials for the new K-8 school. The board issued pu…
Were radioactive seeds sold to medical providers for prostate-cancer brachytherapy exempt from South Carolina sales tax?
Yes, for the taxpayer and facts in this PLR. Radioactive seeds sold to hospitals, medical centers, and practitioners for prostate-cancer brachytherapy were exempt therapeutic radiopharmaceuticals. The…
When a Connecticut resident exercises a testamentary power of appointment to create a new trust, is that appointive trust's residency set by the residency of the person who gave the power (the donor) or the person who exercised it (the donee)?
It depends on the type of power. If the power exercised is NOT a general power of appointment (a 'special' power), the appointive trust's Connecticut residency is determined by the residency of the DO…
Can an asphalt-making paving contractor qualify for the manufacturing machinery exemption by splitting its paving jobs into separate contracts for the asphalt and the installation?
No. An asphalt-making paving contractor cannot qualify for the manufacturing machinery exemption (Conn. Gen. Stat. § 12-412(34)) by splitting its paving jobs into separate contracts for the asphalt an…
How did Florida tax a cultured-marble fabricator's retail sales versus its lump-sum fabrication-and-installation contracts?
For retail sales without installation, the company had to collect sales tax on the full sales price of the fabricated tangible personal property, including cutting or shaping services. For lump-sum co…
Could a taxpayer recover a $258 New Mexico income-tax overpayment when the Department failed to credit a $2,700 check but he waited six years to follow up on the refund claim?
No. Fred Schonfeld's $2,700 estimated-payment check omitted his Social Security number, and the Department failed to credit it to 1996. Correcting the account produced a real $258 overpayment. But Sch…
Was a retailer's fuel surcharge for delivering taxable merchandise in its own vehicle subject to South Carolina sales and use tax?
Yes, when the underlying merchandise was taxable. A fuel surcharge charged for delivery in the retailer's own vehicle was part of gross proceeds or sales price, so the tax base included the merchandis…
Could a multistate corporation exclude gross proceeds from selling Florida business assets from its Florida sales factor?
No. The Florida Department of Revenue required the corporation to include gross proceeds from selling its Florida business assets in the Florida sales-factor numerator and everywhere denominator. Alth…
Did a taxpayer owe interest when she correctly filed and paid her New Mexico income tax, but the Department mistakenly sent an unsolicited refund and later assessed it back?
No. Mary Ann Mendonca correctly filed her 1999 return and paid the $61 due. The Department mistakenly added a duplicate federal exemption and sent an unsolicited refund it lacked authority to initiate…
Does medical equipment used to perform Lasik eye surgery qualify for the New York investment tax credit?
No. The investment tax credit under section 210.12 (Article 9-A) and section 606(a) (Article 22) requires property used in qualifying activities such as manufacturing or production of goods. A physici…
Does a sub-subcontractor sorting World Trade Center debris for the NYPD owe sales tax on its equipment, rentals, and consumables, even though its ultimate customer is a tax-exempt government agency?
The subcontractor's own purchases and rentals of equipment, tires, maintenance items, and consumables are subject to New York sales tax, even though the ultimate customer is the tax-exempt NYPD — the …
Can a private utility include its section 186-a gross receipts tax in the transmission charges it bills to a municipal electric system?
Yes. The municipal electric system is excluded from the definition of "person" under section 186-a.2(b), so it is not itself a 186-a utility. But the private transmission utility is subject to section…
When could a Florida newspaper publisher exclude an independent-carrier delivery charge from sales tax?
The publisher did not have to collect sales tax on an independent-carrier delivery charge when, at the initial subscription or renewal, it disclosed the carrier and mail-delivery charges, told the sub…
Were canal-maintenance fees and per-barrel wharfage charges under a perpetual navigational easement subject to Florida sales tax?
No. The Florida Department of Revenue concluded that the perpetual, nonexclusive canal easement was a true navigational easement rather than a taxable lease or license to use real property, so the rel…
Did spouses owe more than minimum documentary stamp tax when they deeded unencumbered Florida property to their wholly owned LLC?
No. Only minimum documentary stamp tax was due because the property was unencumbered, the LLC gave no money, added membership interests, or other consideration, and the spouses' ownership of the LLC w…
Was a Kansas hotel's fixed monthly charge taxable when a hospital rented five rooms for a sleep laboratory rather than ordinary overnight lodging?
Yes. A hospital's three-year contract paid a hotel $6,000 per month for a dedicated block of five rooms used as a sleep laboratory. The hospital kept its computers, cameras, oxygen concentrators, moni…
Are charges for a company's service of retrieving individual police accident reports from local police departments and delivering copies to an auto insurer subject to New York sales tax?
Yes. A company that retrieves individual copies of police accident reports from local police departments (one report at a time, by request) and delivers them to an insurance company is providing a tax…
Could a corporate group stop filing Florida consolidated returns after a reverse acquisition and extensive restructuring?
No. Florida denied permission to discontinue consolidated corporate income tax returns. Although a reverse acquisition changed the parent, officers, commercial domicile, headquarters, subsidiaries, an…
Did the requesting youth nonprofit qualify for a Kansas retailers' sales or compensating tax exemption under K.S.A. 79-3606(ii)?
No. The requesting youth nonprofit asserted that it qualified under K.S.A. 79-3606(ii), but the Department reviewed the sales-tax exemptions and found none that encompassed the organization. Nonprofit…
Did a nonprofit corporation or charity automatically qualify for exemption from Kansas retailers' sales and compensating taxes?
No. The Department reviewed K.S.A. 79-3606 and found no exemption that encompassed the requesting nonprofit corporation or charity. Kansas narrowly construes tax exemptions, and nonprofit status alone…
Are consulting and training services taxable when a Florida vendor sells them together with a taxable software license?
Yes. Because the consulting and training services were an integral, essential part of the software license agreement, their charges were part of the taxable sales price. This held true whether the ser…
Did subsidiary occupants owe Florida sales tax when they used a related parent's commercial property without paying stated rent?
Not under the limited facts, provided the subsidiaries paid no consideration for occupying the parent's property. Their profit or cash-flow distributions would avoid treatment as taxable rent only if …
After a Texas audit assessment, how long does a taxpayer have to raise credit issues in a redetermination, and can limitations-barred credit issues be added later?
A taxpayer has the 30 days set by Tax Code Sec. 111.009 to raise both redetermination and credit issues, and issues already barred by limitations cannot be added after that. The Comptroller's General …
Did the requesting nonprofit corporation qualify for exemption from Kansas retailers' sales and compensating taxes?
No. After reviewing K.S.A. 79-3606, the Department found no exemption encompassing the requesting nonprofit corporation. Kansas construes exemptions narrowly, so nonprofit status by itself was not eno…
How is the 2004 federal credit for prior year minimum tax (Form 8801) recomputed for an estate or trust to figure the Nebraska credit, and where does it go on Form 1041N?
Revenue Ruling 23-04-2 directs that an estate's or trust's 2004 federal credit for prior year minimum tax -- from Federal Form 8801 -- be recalculated for Nebraska fiduciary income tax purposes to det…
Does the alternative minimum tax on a 2004 federal fiduciary return (Form 1041, Schedule I) have to be recomputed to figure the Nebraska minimum tax, and which Form 1041N lines change?
Yes. Revenue Ruling 23-04-1 directs that the 2004 federal alternative minimum tax for estates and trusts -- from Federal Form 1041, Schedule I -- be recalculated for Nebraska fiduciary income tax purp…
How do you recompute the 2004 federal credit for prior year minimum tax (Form 8801) to figure the Nebraska minimum tax credit on Form 1040N?
Revenue Ruling 22-04-3 directs that the federal credit for prior year minimum tax figured on a taxpayer's 2004 federal return (Federal Form 8801) be recalculated for Nebraska individual income tax pur…
Does the alternative minimum tax on your 2004 federal individual return have to be recomputed to figure the Nebraska minimum tax, and which Form 1040N lines change?
Yes. Revenue Ruling 22-04-2 directs that the 2004 federal alternative minimum tax -- from Federal Form 6251 or the Form 1040A Alternative Minimum Tax Worksheet -- be recalculated for Nebraska individu…
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