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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Were aircraft transfers to a new Florida LLC exempt when one transfer occurred by merger and another supplied aircraft for rental and flight instruction?
The corporation's aircraft transfer to the surviving LLC through the statutory merger was exempt if applicable tax had been paid on original acquisition. The nonprofit's separate transfer to the LLC w…
Did art and antique fairs qualify as industry trade shows so exhibitor-space subleases were exempt from Florida commercial-rent tax?
Yes. The shows promoted trade in the art and antiques industries and qualified as industry trade shows even though the public attended and retail sales occurred. The organizer paid tax on its prime co…
If a corporation stops doing business in Texas and later resumes, does it lose its Texas franchise-tax business loss, and is that the same as a federal NOL?
No - stopping and later resuming Texas business does not by itself destroy a franchise-tax 'business loss,' but the loss can only be used while it is still within its carryforward period. The Texas fr…
Is a nonprofit senior center exempt from Kansas sales tax on its purchases and fundraising sales?
No. The Department advised that a nonprofit senior center is not exempt from Kansas sales tax — not every non-profit organization enjoys an exemption, and no statute exempts senior centers. Creating s…
Do chemicals purchased to clean dairy equipment qualify for Kansas's 'consumed in production' sales-tax exemption?
No. The Department ruled that chemicals purchased to clean dairy equipment do not qualify for the 'consumed in production' exemption in K.S.A. 79-3606(n). Kansas regulation K.A.R. 92-19-53(c)(3) speci…
Is a rural water district's flat monthly meter fee subject to Kansas sales tax?
Yes. The Department ruled that a flat monthly meter fee a rural water district bills to all customers — whether or not they buy water — is subject to Kansas sales tax. It does not fit any of the three…
Was a permanently constructed cogeneration power plant on leased land an immovable, making later title transfers outside Louisiana sales tax?
Yes. The plant qualified as a building because of its manufacturing use, walls, roof, permanent materials, and long-term installation. Its structure and permanently attached components were immovable,…
Which cylinder inspection, blasting, pressure-testing, and recoating charges were taxable, and what happened when they were billed together?
Inspection and hydrostatic testing were nontaxable, and blasting needed only to expose markings and permit inspection shared that treatment when separately stated. Recoating a blasted cylinder was a t…
Does a corporation building a pork-processing plant in a Texas Strategic Investment Area qualify for the franchise-tax capital investment credit, and possibly the jobs creation credit?
Yes. On the facts presented, the Comptroller concluded that the corporation could claim the pre-2008 Texas franchise-tax capital investment credit, and noted it might also qualify for the jobs creatio…
Is installing water, sanitary sewer, and storm sewer lines for a developer exempt as original construction, and can the developer buy the materials tax-free?
The installation labor is exempt, but the materials are taxable. The Department ruled that installing water lines, sanitary sewer lines, and storm sewer lines on a developer's real property that is la…
Which of a sailing association's charges — membership fees, boat slip fees, and boat/trailer storage — are subject to Kansas sales tax?
It depends on the charge. The Department ruled that the sailing association's membership fees are taxable because they let members use the facilities for recreation or entertainment. Separately stated…
Are water, gas, and electricity used by a car wash exempt as consumables, and which uses remain taxable?
Water and utilities consumed in operating all types of car washes were exempt like soap, wax, and cleaning chemicals. Exempt electricity included power for pumps, mechanical washers, and coin-operated…
Can a negligence penalty be abated when a taxpayer failed to pay gross receipts tax while exhausted from caring for a dying fiancé — and does interest still apply?
The penalty was abated because of the caregiving hardship, but interest still applied, so the protest was granted in part and denied in part. Julia Santos (later Griswold) did home health-care work as…
Did a city's generator direct-purchase arrangement qualify for exemption when the contractor kept title and risk of loss until final acceptance?
No. Direct city purchase orders, invoices, payment, and insurance were not enough because the contract left title and risk of loss with the contractor until city acceptance. The city could qualify fut…
Did a city's direct-purchase procedures qualify police-station construction materials for Florida's government sales-tax exemption?
Yes. The city issued purchase orders with its exemption number, received direct invoices, paid vendors directly, took title and liability at job-site delivery, and bore insured risk of loss. Those doc…
Are radio frequency generators and catheters exempt from Kansas sales tax when bought directly by a nonprofit hospital versus by a for-profit surgical center or doctor?
It depends on the buyer. The Department ruled that radio frequency generators and catheters are exempt from Kansas sales tax when a public or private nonprofit hospital purchases them directly and use…
Can a charitable not-for-profit that is not a religious organization use Kansas's religious-organization sales-tax exemption?
No. The Department ruled that the exemption in K.S.A. 79-3606(aaa) applies only to religious organizations and does not extend to all charitable not-for-profit entities. Because the requesting charity…
If a trusted office manager embezzles and secretly stops paying a company's withholding taxes, can the company avoid interest and penalty on the late payments?
No — the interest and penalty stood, so the protest was denied. Pat Campbell Insurance's long-time office manager secretly stopped mailing the company's withholding-tax returns and payments for more t…
Does Kansas exempt an organization's fundraising sales of Christmas trees from sales tax?
No. The Department ruled that Kansas law contains no exemption or exception for the organization's fundraising sales of Christmas trees. The organization must collect and remit Kansas sales tax on all…
Could a separate purchasing entity use a Kansas direct-pay permit and then accept a resale certificate from the related operating entity that consumed the property?
No on the proposed facts. A direct-pay permit was for a taxpayer's own business-use purchases when the correct tax treatment or destination was difficult to determine. It was not meant to let one enti…
Are pallets, labels, stretch wrap, tape, and ice used to ship product exempt from Kansas sales tax as ingredient or component parts?
Yes, if they are not returned for reuse. The Department ruled that pallets, labels, stretch wrap, tape, and in some cases ice are exempt from Kansas sales/use tax as ingredient or component parts unde…
Is a New Mexico tax assessment valid if it was mailed to the address on the taxpayer's registration but he had moved out of state without updating it and never received it?
Yes — the assessment mailed to his registered address was valid even though he never got it, so the protest was denied. Christopher Taylor did independent-contractor work for a New Mexico architectura…
Did a county's direct-purchase procedures qualify seaport capital-improvement materials for Florida's government sales-tax exemption?
Yes. The county issued purchase orders with its exemption number, received vendor invoices, paid directly, took title and liability at job-site delivery, assumed risk of loss, and carried insurance. T…
How did Florida sales tax apply when a vehicle lessor used a qualified intermediary for federal section 1031 exchanges?
Federal like-kind treatment did not exempt an end-of-lease sale to an individual; the buyer owed Florida sales tax. A sale to a registered dealer for resale was exempt with a resale certificate. The l…
Did county-furnished-material procedures qualify airport rental-car-facility construction materials for Florida's government exemption?
Yes, on the submitted contract section and stated assumptions. The county issued approved purchase orders with its exemption number, received invoices, paid vendors directly, took title and liability …
Were thirteen formulated racing-fuel blends subject to Florida motor-fuel tax or sales and use tax?
The thirteen blends were not subject to Florida motor-fuel tax because their lead content exceeded the gasoline parameters the Department adopted from federal and industry guidance, and they were for …
Did Florida's two-mill nonrecurring intangible tax apply to a synthetic lease or the recording of land and improvements memoranda of lease?
No. For nonrecurring intangible-tax purposes, a leasehold interest was personal property rather than Florida real property. An obligation secured by that interest was outside section 199.133, and reco…
Did a surviving Florida limited partnership become a new obligor for documentary stamp tax when it renewed a note and mortgage after merger?
No. The original partnership's obligations became the surviving Florida partnership's obligations by operation of merger law, so the survivor was not a new obligor. The renewal remained exempt only if…
Is windshield repair for car-rental fleets a taxable service or a tangible-property sale, and can wrong-type NTTCs accepted on a customer's say-so still support a gross receipts tax deduction?
It is a taxable service, and the wrong-type NTTCs did not save the deductions, so the protest was denied. Save A Shield repaired and reconditioned car-rental windshields using a proprietary resin it n…
Is railroad disability income (received by an employee disabled before reaching normal retirement age under the Railroad Retirement Act) excludable from Utah taxable income the same way railroad retirement income is?
No. Railroad disability income is not excludable from Utah taxable income. Federal and Utah law only allow a subtraction for railroad retirement income (reported on the federal 1040's pension/retireme…
Could Louisiana Revenue pay an Enterprise Zone sales-tax rebate when the final application was filed after the statutory and regulatory deadline?
No. Absent a judicial order, Revenue said it lacked authority to issue a late rebate. The statute required filing within six months after receipt of the completion report, while the cited rule used si…
Which of the various add-on charges on a truck-rental invoice -- insurance, damage waivers, furniture pads, replacement fees, repair costs, citations, cleaning, and IFTA fuel tax reimbursement -- are subject to Utah sales tax?
Personal accident insurance and loss damage waiver charges are taxable because the rental company (not a licensed insurer) is selling an add-on product, not insurance; furniture pad/dolly rentals, los…
How did original Revenue Ruling 01-018 treat continuously outstanding debt under a multiyear master loan, and what later change affected floor-plan financing?
The annual minimum balance was included as long-term borrowed capital because it financed the business continuously for more than a year. A later statute excluded specified floor-plan financing for pe…
Were fees for videotaping legal proceedings and providing recordings to the parties subject to Florida sales tax?
No, when the recording was furnished to a party to the legal proceeding as part of the videography service. The videographer was the taxable consumer of the blank tapes. A recording sold to a third pe…
Can a Kansas contractor buy materials tax-free for an out-of-state job under the temporary-storage exemption?
Only in narrow circumstances. The Department ruled that a contractor may claim Kansas's temporary-storage exemption (K.S.A. 79-3702(e)) on materials only if they are (1) purchased from an out-of-state…
Were goods shipped by an out-of-state seller through a Florida freight forwarder for export exempt from Florida sales and use tax?
Yes, while the export process remained continuous. The seller and buyer were outside Florida, the goods were outside Florida at sale, and a common carrier brought them to a Florida forwarder already c…
When a dealer sells a trade-in vehicle before receiving its title from the prior lienholder, on what date is the dealer's security interest in that vehicle perfected?
A dealer's security interest in a vehicle relates back to (is perfected as of) the date of sale only if the dealer files the certificate of title and required lien paperwork with the Division of Motor…
How did Florida documentary stamp and annual intangible taxes apply to timeshare cooperative shares and notes transferred to an out-of-state subsidiary?
The cooperative stock certificate was not separately documentary-stamp-taxable because tax applied to the occupancy-right document, and the inseparable stock and dwelling rights avoided annual intangi…
Did the insurer qualify for Florida's limited tax exemption for a property-and-casualty insurer owned at least 51% by minority persons?
No. Although the insurer received an initial Florida certificate of authority after the statutory date, its direct owner was a corporation, not a statutory minority person. Sections 624.4072 and 288.7…
Were subscriptions to an online real-estate information service, downloaded software, CDs, and shipping subject to Florida sales tax?
The online database subscription and electronically downloaded software were not taxable tangible property. Free access-software CDs did not tax the subscriber, but the provider owed tax when buying t…
When is a Kansas retailer's out-of-state shipment exempt from Kansas sales tax, and what proof of delivery is needed?
The out-of-state shipment is not taxed. The Department ruled that when a seller is obligated to deliver goods to a point outside Kansas — or delivers them to an interstate common carrier or the mails …
Are a church-affiliated camp's fees for summer camp and instructional activities subject to Kansas sales tax?
No. The Department ruled that the fees paid to attend the church-affiliated summer camp are not subject to Kansas sales tax, and neither are the fees for its instructional classes — archery, swimming,…
Can New Mexico refund overpaid gross receipts tax if the business discovers a missed deduction and files its refund claim more than three years after the tax was due?
No — the refund claim was filed too late and had to be denied. Perez Trucking's bookkeeper later discovered that in July–September 1997 she had failed to claim a gross receipts tax deduction for hauli…
When the IRS audits a corporation and changes its income, must the corporation file an amended Texas franchise-tax report, and by when?
Yes. Under Tax Code Sec. 171.212(a)(1), a corporation must file an amended franchise-tax report when its net taxable earned surplus changes as a result of an IRS audit or other adjustment, and Sec. 17…
Can an out-of-state county claim a Kansas sales-tax exemption on goods it takes delivery of in Kansas?
No. The Department ruled that a Missouri county may not claim a Kansas sales-tax exemption when it takes delivery of asphalt emulsion in Kansas. The sale occurs in Kansas when possession transfers the…
Were separately stated late-payment fees on electric, water, and sewer utility bills subject to Florida sales tax?
No. The utility separately stated a 1.5% late fee on the next bill only when the customer failed to pay the prior balance by its due date. Because the customer could avoid the charge solely by timely …
How did an eligible citrus processor elect Florida's single-sales-factor formula and combine it with three-factor affiliates on a consolidated return?
An eligible citrus processor elected the single-sales-factor method by using it on the originally filed return for that tax year. The election was company-by-company, annual, and irrevocable for that …
Was the allocated price of a hotel's land, improvements, and fixtures subject to Florida sales tax because a broker handled the sale?
No. The documents allocated value to land, improvements, and fixtures and did not specifically identify inventory, vehicles, or other tangible items within those categories. Those assets were real pro…
Which carpet, furniture, contents, structural-cleaning, storage, and drying-equipment charges were taxable when separately stated?
Carpet and furniture cleaning were taxable. Carpet reinstallation, miscellaneous-content cleaning, and structural cleaning were nontaxable when separately stated. Drying equipment was taxable if the c…
When must a Louisiana seller report sales tax on season tickets purchased through installment payments?
The seller reported the sale when full payment was collected, tickets were issued, or admission was provided—whichever happened first. With installments, that was generally the final-payment month unl…
Which Kansas grain elevator purchases are taxable and which are exempt on and after January 1, 2001?
This notice tells Kansas country and terminal grain elevator operators which purchases are taxable or exempt on and after January 1, 2001, and supersedes prior elevator notices. The simple rule: purch…
Did previously granted permission to stop filing Florida consolidated returns remain valid after the actual taxable-income difference exceeded the estimate?
Yes. The parent notified the Department that the actual difference between separate and consolidated pro forma Florida taxable income was greater than the amount presented in its earlier request. Afte…
Were sales of timeshare cooperative shares and shareholders' annual common-expense assessments subject to Florida sales, transient-rental, or local tourism taxes?
No. A purchaser acquired a cooperative stock ownership interest with inseparable occupancy rights, not a lease, license, transient rental, or tangible item. Annual assessments paid each shareholder's …
How does a Nebraska estate or trust recompute the 2001 federal alternative minimum tax to figure the Nebraska minimum tax?
Recompute the federal AMT on Nebraska terms. Under Revenue Ruling 23-01-1, Neb. Rev. Stat. §77-2717 requires an estate or trust to recalculate the 2001 federal alternative minimum tax (Federal Form 10…
How does a Nebraska individual figure the 2001 credit for prior year minimum tax on the Nebraska return?
Recompute the federal credit for Nebraska. Under Revenue Ruling 22-01-2, Neb. Rev. Stat. §77-2715(2) requires an individual to recalculate the federal credit for prior year minimum tax (Federal Form 8…
How does a Nebraska individual recompute the 2001 federal alternative minimum tax to figure the Nebraska minimum tax?
Recompute the federal AMT on Nebraska terms. Under Revenue Ruling 22-01-1, Neb. Rev. Stat. §77-2715 requires a Nebraska individual to recalculate the 2001 federal alternative minimum tax (Federal Form…
A state urban-development subsidiary is condemning land in midtown Manhattan and will ground-lease it to our LLC for 99 years (with an option to buy for $10 after 29 years) so we can build an office tower to be converted to condominium units for our two members. (1) Is transfer tax due when the state delivers vacant possession of the land to us and our lease rights actually begin? (2) Is the tax based only on the $85.56 million land price plus limited percentage rent, or does it include reimbursable excess acquisition costs? (3) Does merely signing the ground lease and recording a memorandum of it trigger tax before possession is delivered? (4) Is transferring the finished condominium units from the LLC to its two members, who always beneficially owned their own space, exempt?
Four different answers to four issues, most favorable to the taxpayer. This ruling addresses the New York Times Building project: a state ESDC subsidiary ('42DP') would condemn land at 8th Avenue/40th…
Is a city's purchase of a diesel generator to produce electricity for sale exempt from Kansas sales tax?
Yes, under the manufacturing exemption. The Department ruled that a city's purchase and installation of a diesel generator and associated equipment to produce electricity for sale is exempt under K.S.…
At a weight-management clinic, which charges are taxable — instructional classes, fitness-center membership, or food products?
It depends on the charge. The Department ruled that fees clients pay to attend or participate in the clinic's classes — including the individualized private weight-management class and the 'Mommy Clas…
How did Florida sales tax apply to installed-price flooring contracts, post-sale payment discounts, and advertising that no additional tax would be charged?
The flooring company was the consumer under its installed-price real-property contracts, so it paid sales or use tax on materials and did not charge the owner tax. Early-payment or cash discounts take…
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