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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Does an event venue that rents space, tables, and chairs (but no overnight lodging) owe Virginia sales tax on its bookings, and can an auditor extend the audit period past the signed waiver?
An event venue's charge for the space itself isn't subject to Virginia sales tax unless it includes an overnight stay, but tangible personal property the venue rents along with the space -- tables, ch…
Does an extended overseas government assignment -- even one repeatedly extended for years -- establish a new foreign domicile that ends Virginia tax residency?
No, not on these facts. A Department of Defense civilian employee's overseas assignment -- even after being extended twice, ultimately spanning about five years -- remained a temporary, non-permanent …
What South Carolina tax interest rate applied through September 30, 2023, including eligible refund interest for fiscal year 2023-2024?
The listed South Carolina tax interest rate remained 7% from January 1 through September 30, 2023. Interest generally compounded daily, except estimated-tax underpayments used simple interest. For fis…
Are separately stated delivery charges subject to Kansas sales tax?
Kansas Notice 23-02 explains that, beginning July 1, 2023, delivery charges that are separately stated on the invoice, bill of sale, or similar document given to the purchaser are excluded from the "s…
At a restaurant, which tips are subject to Colorado sales tax — pooled tips, a mandatory gratuity the customer can't remove, and prepopulated tips the customer can remove at checkout?
It depends on whether the customer can decline the tip and whether all of it reaches the staff. Voluntary tips — including pooled and prepopulated tips a customer can remove at checkout — are NOT subj…
Were printed informational stickers sold to automobile dealers for attachment to cars offered for sale subject to Florida sales tax?
No. The stickers remained affixed to cars offered for sale and supplied information about the vehicles, so Florida treated them as nontaxable labels rather than retail sticker sales.
Are pre-cooked, packaged meals that a remote seller ships to Colorado customers — meals that need further cooking and aren't sold hot or with utensils — exempt from Colorado sales and use tax as food for home consumption?
Yes. A remote seller's pre-cooked, air-chilled, packaged meal products — shipped with FDA nutrition labels, not sold hot or with utensils, and requiring further cooking by the customer — are food for …
When is a factory-built manufactured home taxed as tangible personal property rather than a real-property improvement, and which related charges follow that classification?
Classification turns on the contract and whether the home will be placed on a permanent foundation or connected to utilities. A separately sold home installed later by another party is taxable tangibl…
Was the waste-removal broker renting dumpsters to Florida customers or selling a nontaxable garbage-disposal service?
It was selling a nontaxable waste-disposal service. The broker did not own or lease the dumpsters, and customers paid for removal service rather than possession or control of the containers.
How long do I have to claim a refund of Virginia income tax I actually paid on a return I filed?
Three years from the original due date of the return, with no extensions available -- a taxpayer who paid his 2017 Virginia tax on time but didn't ask for a refund of that year's overpayment until Sep…
Can a Virginia resident claim credit on their state income tax return for New York franchise tax or Tennessee excise tax paid by their S corporation?
No. Virginia's credit for taxes paid to another state is limited to a true 'income tax' as Virginia law specifically defines that term, and both the New York franchise tax (measured in part by busines…
My accountant never checked the box to waive the carryback of our old net operating loss, and now the Department has carried it back to earlier years and created tax due I didn't expect -- can that be undone?
No -- if the taxpayer did not make a timely election under IITA Section 207(a-5) to relinquish the carryback period (by checking the box on the loss-year return by its extended due date), the loss mus…
I took a lump-sum retirement distribution and claimed Net Unrealized Appreciation (NUA) treatment, but I also have a federal net loss carryforward that offset the NUA gain on my federal return -- does that net loss carryforward stop me from subtracting the NUA on my Illinois return?
No -- according to the Department, a federal net loss carryforward does not affect your eligibility for the Section 203(a)(2)(F) subtraction for net unrealized appreciation (NUA) on employer securitie…
I have an Illinois resident employee who works full-time in Tennessee, which has no state income tax withholding -- do I report their wages as Illinois wages in Box 16 of their W-2, or report zero?
Report the wages as Illinois wages in Box 16 -- Publication 130 is correct and controls, not the older GIL. Because the employee is an Illinois resident performing all services in Tennessee (which has…
Did the parent company show reasonable cause to stop filing consolidated Florida corporate income tax returns?
Yes. Major changes in the company's operations, service offerings, and revenue mix since its original election justified deconsolidation, subject to four conditions stated in the ruling.
Did the nonresident operator owe Florida use tax on aircraft and installed upgrades brought into the state exclusively for flight training and modifications?
No. The operator was a nonresident, and the documented aircraft use in Florida was exclusively for contracted flight training and for repairs, alterations, refitting, or modifications.
My Illinois-resident employee splits work time between an out-of-state office and an Illinois office each pay period -- can I use my own proration method (or must I use a time and attendance system or Form IL-W-6) to figure out how much of the wages are taxable to Illinois?
The Department didn't approve or reject the taxpayer's specific proration method -- instead it explained the governing rule: under IITA Section 304(a)(2)(B)(iii), compensation is paid in Illinois if t…
Is a yearly subscription fee for using computer software (not owning it) subject to Illinois sales tax?
It depends on how the software is delivered and licensed: cloud-based software that is never downloaded to the customer's computer is not taxable, and a properly-documented software license meeting fi…
Does machinery and equipment used to blast freeze, slow freeze, cool, and cold-store perishable food products for a manufacturer's customers qualify for Illinois's manufacturing machinery and equipment (MM&E) sales/use tax exemption?
Yes. The Illinois Department of Revenue ruled that the freezer, cooling, and cold-storage machinery and equipment described by the taxpayer qualifies for the manufacturing machinery and equipment exem…
If an auditor refuses to review additional exemption certificates I gathered during a sales tax audit, can I get them reviewed on appeal?
Yes. A dealer's 353 additional exemption certificates and corrected resale certificates, which the auditor allegedly refused to review during the audit itself, were sent back to the Department's Tobac…
Does Virginia's data center sales tax exemption still apply if the equipment is delivered to a storage facility first, rather than straight to the data center?
Yes. Virginia's data center sales and use tax exemption applies to qualifying equipment even when it's delivered to a storage facility before the data center itself is ready to receive it, because the…
When exactly does a domicile change take effect if I was searching for a new home in another state for months before I actually bought it?
Yes -- domicile can change before you actually complete the formal steps (like buying a home or surrendering your old driver's license) if your conduct over time clearly shows the intent. A taxpayer w…
What does Illinois General Information Letter IT 23-0007-GIL conclude about Base Income — Elimination Of?
YES, confirmed -- because the >90%-owned partnership is treated as a full member of the Illinois unitary business group, the intercompany royalty, service-fee, and interest items (and the IP-transfer …
Does an accelerated lump-sum pension payment stay exempt from Illinois income tax after a company sale triggers plan termination?
The Department did not confirm the lump sum would be exempt. It first corrected the taxpayer's own citation -- Section 1402 of the Illinois Income Tax Act governs the Department's notice requirements,…
Does a lump-sum payment that replaces years of scheduled retirement benefits stay exempt from Illinois income tax when a company sale forces early plan termination?
The Department did NOT confirm the lump sum would be exempt. It corrected the taxpayer's citation -- Section 1402 of the Illinois Income Tax Act governs the Department's own notice requirements, not t…
What does Illinois General Information Letter IT 23-0004-GIL conclude about Nexus?
The Department explicitly declined to answer. IDOR does not issue letter rulings resolving specific nexus questions because nexus determinations are inherently fact specific, so it never decided wheth…
For an out-of-state retailer that sells to tax preparers (including through a marketplace facilitator), when did Illinois's economic nexus/remote-seller rules take effect, and are products like presentation folders, envelopes, tax forms, and checks taxable?
The Department confirms that Illinois's Wayfair-style economic nexus standard took effect October 1, 2018 (a retailer must register and collect Illinois Use Tax once it has $100,000+ in Illinois sales…
A small van-rental business collects Illinois's Automobile Renting Tax from its customers, but the dealers it buys vehicles from won't honor a sales-tax exemption on those purchases -- is the business actually exempt from Retailers' Occupation Tax and Use Tax when it buys vehicles for its rental fleet?
Yes, generally: the Retailers' Occupation Tax Act and Use Tax Act exempt the sale of a motor vehicle that will be used for automobile renting as defined in the Automobile Renting Occupation and Use Ta…
Does a Missouri municipality have to charge sales tax on concessions and other items sold at its Community Center and Aquatics Center?
NO, Applicant's sales of concessions and other items of tangible personal property at its Community Center, Aquatics Center, and recreational events are not subject to sales tax, because Section 144.0…
Does a food-delivery platform have to collect and remit Missouri sales tax on restaurant orders and delivery fees?
NO to both questions. The Applicant (a food-delivery platform) does not need to collect and remit Missouri sales tax on food and drink sold by in-state restaurants -- the restaurants remain the seller…
Does a 501(c)(3) charity have to collect and remit Missouri sales tax on donated clothing it sells at its resale/thrift store?
NO, the charity does not have to collect and remit sales tax on the items sold at its resale/thrift store, because Section 144.030.2(19), RSMo, exempts sales made by charitable organizations in their …
Are a packaging company's sales of custom, customer-branded packaging materials subject to Missouri sales tax?
YES, Applicant's sales of packaging materials -- including packaging printed with a customer's own branding -- are subject to Missouri sales tax as long as title transfers to the customer in Missouri.…
Does a Missouri medical spa owe sales or use tax on cosmetic injection products like Botox and dermal fillers that it buys from out-of-state vendors?
YES, the medical spa's out-of-state purchases of cosmetic injection products (Botox, Xeomin, Dysport, Sculptra, Restylane, Juvederm, and RHA fillers) are subject to Missouri use tax, because the spa i…
What does Illinois General Information Letter IT 23-0003-GIL conclude about Credits?
The Department answered two of the employer's three questions: tips themselves are NOT counted as compensation when computing the minimum wage credit, but any amount the employer pays to make up a sho…
What happens to my Virginia residency appeal if I don't respond to the Department's requests for more information?
A taxpayer who ignored two written requests to complete a domicile questionnaire was still given one final 30-day chance to respond before the Department finalized its position -- but was also warned …
Can Virginia levy my entire joint bank account to collect my spouse's tax debt from before we were married?
Only half. Virginia presumes each spouse owns half the funds in a joint bank account, so a lien for one spouse's tax debt from before the marriage can only reach that spouse's half -- the other spouse…
Does a college student who later gets a driver's license and registers a vehicle in their college state become a part-year Virginia resident from the date they graduate?
Yes. College students generally don't establish domicile where they merely attend school, but once this student graduated and then obtained an out-of-state driver's license and vehicle registration --…
Is a Virginia tribal member's income exempt from state tax if they work on the reservation but live somewhere else, or vice versa?
A Virginia tribal member's income is exempt from Virginia income tax only for the portion earned from activities actually performed ON their tribe's reservation -- where the member lives is irrelevant…
Can the Virginia Department of Taxation waive penalty and interest on a local transient occupancy tax assessment?
No. The Virginia Department of Taxation has no jurisdiction to hear appeals of local transient occupancy (short-term rental/lodging) tax at all -- that tax isn't one of the local business or mobile pr…
If I find documentation proving a customer had a direct pay permit after my sales tax audit already closed, can I still get that sale removed from the assessment?
Yes. A dealer whose incomplete records led to an estimated first-audit assessment can still get specific transactions removed if it later produces supporting documentation -- here, a customer's direct…
Does an out-of-state vehicle seller create Illinois nexus just because it hires a third-party company to calibrate equipment at customers' locations in Illinois after delivery?
The Department wouldn't say definitively -- nexus is too fact-specific for a GIL -- but it explained that an out-of-state retailer with an ongoing physical presence in Illinois (including through an a…
Can a manufacturing company elect Virginia's favorable single-sales-factor apportionment method for the first time on an amended return, or only on its original return?
Yes -- a manufacturing company can elect Virginia's favorable manufacturer's apportionment method (Va. Code § 58.1-422) for the first time on a timely amended return, not only on its original return. …
How long does Virginia have to recover a refund it paid out by its own mistake, and do I owe interest on the money back?
Two years from the date the erroneous refund was issued -- when the Department's own processing error increased a couple's mortgage-interest deduction and paid them a bigger refund than they'd actuall…
Did Virginia's 2020 COVID-19 payment-deadline extension also extend the 3-year deadline to claim a refund for an old tax year?
No -- Virginia's COVID-19 payment extension (moving the 2020 payment deadline to June 1, 2020) applied only to PAYMENTS, not to the deadline for filing a return to claim a refund, so a taxpayer who fi…
Are vaccines that a veterinarian buys and gives to a client's dog, cat, or horse exempt from Virginia sales and use tax?
Yes -- companion-animal (canine, feline, equine) vaccines qualify as "drugs" under Virginia's Drug Control Act, and when purchased and administered by a veterinarian within a veterinarian-client-patie…
Does Virginia's aircraft-tax exemption for airlines providing "scheduled air service" also cover charter or on-demand flights operated under FAA Part 135?
No -- Virginia's aircraft sales and use tax exemption for air carriers providing "scheduled air service" is limited to service operated over published routes/schedules, and does NOT extend to an FAA P…
Does Virginia's aircraft-tax exemption for airlines providing "scheduled air service" also cover charter or on-demand flights operated under FAA Part 135?
No -- Virginia's aircraft sales and use tax exemption for air carriers providing "scheduled air service" is limited to service operated over published routes/schedules, and does NOT extend to an FAA P…
When is a city entitled to Section 351.156 tax revenue from a planned hotel-and-convention-center project, and which nearby restaurants and retail count as 'connected to' the qualified hotel or convention center?
Yes, conditionally. The city (eligible under Section 351.152(31)) will be entitled under Section 351.156 to the state sales/use and hotel taxes — and, with written consent, local and mixed beverage ta…
Is a Texas city entitled to receive state sales, hotel occupancy, and mixed beverage tax revenue generated by a new convention-center hotel project and the restaurants/bars/retail located near it?
Yes, conditionally. The city qualifies under Tax Code § 351.156 to receive state sales tax, hotel occupancy tax, and (with local agreement) mixed beverage tax revenue generated by the qualified hotel,…
When a seller delivers goods in Illinois to a common carrier, contract carrier, or freight forwarder that then ships them out of state or out of the country, is the sale exempt from Illinois Retailers' Occupation Tax as an interstate or foreign commerce sale, and what documentation does the seller need to prove it (or to prove a resale or manufacturing exemption instead)?
Yes, the sale can be exempt as an interstate (or foreign) commerce sale, but only if the seller -- not the purchaser -- is shown as the consignor or shipper on the bill of lading and the seller keeps …
My New Mexico business shipped custom orders out of state, but a flood destroyed the records — can I still prove those sales weren't subject to gross receipts tax?
Yes — the taxpayer won a complete abatement. Trader Barbs Old Town LLC, Barbara Pratt's jewelry store in Old Town Albuquerque, was assessed $42,595.90 in gross receipts tax, penalty, and interest for …
What Illinois sales tax rate applies to a soy-free, whole-food-based powdered shake mix?
It appears to qualify for the lower 1% state tax rate on food (temporarily reduced to 0% from July 1, 2022 through June 30, 2023) rather than the higher 6.25% rate for candy or soft drinks, because th…
Is a software company's canned software, hardware, installation/training services, support, and hosting taxable when sold and delivered to Illinois customers, and when does an out-of-state seller have to start charging Illinois sales/use tax?
Canned (pre-written) computer software and hardware are taxable tangible personal property in Illinois, but custom software is not; separately stated charges for training, installation, telephone assi…
Are the Illinois sales/use tax rules on titling and registering vehicles, watercraft, and aircraft (as summarized in a national Title and Registration Textbook) still accurate, and what should be updated for 2023?
The Department would not formally approve or endorse a third-party publication's summary, but it reviewed the submitted text and proposed specific corrections and additions -- most notably to reflect …
How long does the Illinois Department of Revenue have to assess additional Retailers' Occupation Tax (sales tax) or Use Tax after a return is filed, and is there a special 6-year rule like the one for income tax understatements?
Generally 3 to 3.5 years from when the taxable gross receipts were received under the Retailers' Occupation Tax Act (extended to as much as 3 years after a filed amended return), and 6 to 6.5 years un…
Does a city-owned golf club have to charge sales tax on green fees, cart rentals, merchandise, food, and alcohol, and does it owe sales tax on its own purchases of course supplies and equipment?
NO, in both directions. The municipality-owned golf club's green fees, cart rentals, merchandise, food, beverages, alcohol, and other tangible personal property it sells are NOT subject to sales tax, …
Are audiometers exempt from Missouri sales tax under the hearing aid exemption?
NO, audiometers are not exempt -- they are fully taxable, because Missouri's sales tax exemption in Section 144.030.2(18), RSMo, covers hearing aids and hearing aid supplies, but an audiometer (a devi…
Does Missouri sales tax apply to renting floating dock or boat slip space at a marina, including on multi-year leases, and can a long-term renter claim a permanent-resident exemption?
YES, Missouri sales tax applies to renting floating dock or boat slip space, because floating docks are tangible personal property and the lessor didn't already pay tax on purchasing them. Each lease …
If I couldn't produce detailed invoices during a Virginia sales tax audit, can I still get another chance to provide them on appeal?
Yes, but only once and only for a limited time -- when a first-generation sales and use tax audit had to estimate tax due because the taxpayer couldn't produce detailed invoices or exemption certifica…
Can a Virginia resident subtract retirement account distributions from Virginia income tax because the money was earned while working in another state, or because contributions were made with after-tax dollars?
Generally no -- a Virginia resident's retirement account distributions are fully includible in Virginia taxable income even if the money was earned while the person worked in another state before beco…
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