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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How did the pre-2008 Texas franchise tax apply to a transmission and distribution utility (TDU) and a retail electric provider (REP) after electricity deregulation?
For the pre-2008 Texas franchise tax, the key effect of electricity deregulation was on gross receipts and apportionment. A transmission and distribution utility (TDU) that only moves electricity is…
Was Florida's nonrecurring intangible tax due when a recorded mortgage on Florida real property secured only a contingent guaranty?
No, while the mortgage secured only a contingent guaranty rather than an unconditional obligation to pay money. If the guaranty conditions were later met and the Florida property then secured an…
Which charges in a live-operator answering-service package were subject to Florida communications services tax or sales tax?
Customer charges for the live-operator answering service were not communications services, even when the package included voicemail, an auto attendant, toll-free usage, and fax or pager message…
Was a separately stated, optional guaranteed auto protection charge included in the taxable sales price of a financed motor vehicle?
No. The purchaser alone decided whether to buy the GAP debt-cancellation coverage, and its one-time charge was separately stated on a signed election form. Because the coverage was avoidable and…
Can New Mexico refund an overpayment of gross receipts tax when the claim is filed after the three-year deadline, even if a Department employee never mentioned the deadline and the taxpayer faced serious personal hardship?
No. At Elan Chiropractic overpaid about $3,000 of gross receipts tax for March–October 1997, but did not file a refund claim until September 15, 2001 — after the three-year limitations period in…
Is service work on a manufacturing plant's garage doors exempt under the integrated production (integrated plant) exemption?
No — the work is taxable. The Department advised that service performed on a plant's garage doors is subject to state and local sales tax, because garage doors are not integrated production…
Is a third-party hauler's separate charge to deliver materials to a job site subject to Kansas sales or use tax?
No, on these facts. The Department advised that where an asphalt paving contractor buys materials and separately hires an independent third-party hauler (paid separately from the supplier) to…
Is a tarp purchased to cover an agricultural gravity box exempt from Kansas sales tax as part of farm machinery and equipment?
Yes. A gravity box used in the described farming and ranching operation qualified as exempt farm machinery and equipment, and the tarp covering the box was treated as part of that exempt equipment.…
Which 2002 county classifications did South Carolina publish for job credits, corporate tax moratoriums, and reduced fee-in-lieu investment?
It published period-specific 2002 county lists for job tax credits, two corporate income-tax moratorium provisions, and the reduced $1 million fee-in-lieu investment threshold.
Could a manufacturer buy pallets tax-free when they shipped with finished products but some were first used to store raw materials?
Only pallets used solely as necessary packaging for shipped products were exempt. Pallets first used to store raw materials were subject to sales or use tax because that temporary storage was a…
Was a forfeited deposit taxable when a customer canceled after fabrication, and was use tax due on the discarded materials?
The retained deposit was not subject to sales tax because the customer never received title or possession, so no taxable sale occurred. But use tax applied to the cost price of materials bought…
Is safety and protective apparel for production employees exempt under the integrated production exemption, and are safety shoes exempt if the employee shares the cost?
It depends on whether the apparel is furnished entirely free. Under K.S.A. 79-3606(kk)(1), the integrated production exemption reaches safety and protective apparel an employer buys and furnishes…
Does taking title to a vehicle and assuming or paying its debt create a taxable motor vehicle sale in Texas?
Usually yes. A new owner who pays or assumes the prior owner's vehicle debt gives consideration and owes motor vehicle sales tax. But a co-maker or co-borrower already jointly liable for the…
When are charges for computer programming or software-development services subject to Nebraska sales tax, and when are they treated as nontaxable temporary-employee wages?
Taxable, unless a three-part safe harbor is met. Under Revenue Ruling 01-02-1, Neb. Rev. Stat. §77-2702.07(3) taxes charges for personal services (such as those of programmers and consultants) that…
Were nonreturnable cardboard cartons exempt when they shipped products for resale and could later be folded into retail displays?
Yes. The cartons qualified for the packaging exemption because they contained goods sold for resale, accompanied those goods through delivery, were necessary for practical shipment, and carried no…
Did Florida documentary stamp tax apply when a Florida financing office approved and prepared loan documents that borrowers executed and delivered outside the state?
No. The borrowers signed and delivered the checks containing the promises to pay to an authorized agent outside Florida, and all processing and acceptance occurred there. Florida approval, document…
Does a Louisiana sales-tax filing extension also prevent late-payment penalties and preserve vendor compensation?
Yes, if the filer submits the return and pays all tax by the extension deadline. The payment is timely, so no late-payment penalty applies and vendor compensation is preserved, but interest still…
What CPI increase did South Carolina publish for local-government millage calculations in 2002?
The Department published a 1.6% calendar-year 2001 CPI-U increase, allowing the 2002 general-operating millage rate to rise by 1.6% over the 2001 rate under the cited rule.
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…
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…
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…
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…
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)…
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…
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…
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…
Did film cans, film cores, videotape cases, and audiotape cases qualify for California's teleproduction and postproduction partial exemption?
No. They stored products after preservation or archiving rather than directly performing those processes, and buying them out of state did not eliminate California use tax.
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…
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…
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…
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…
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…
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…
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…
How did South Carolina apply the federal Internet-tax moratorium through November 1, 2003?
The Department would not enforce sales and use tax on Internet access from October 1, 1998 through November 1, 2003, but treated otherwise taxable Internet sales like other transactions.
Did reusable bakery racks that carried fresh baked goods to distribution centers and stores qualify as exempt containers?
Yes. California treated the specialized bread racks as pallet-like containers qualifying under section 6364.
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…
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…
Which exemptions did South Carolina's January 2002 chart identify for local sales and use taxes collected by the Department?
It provided a county-by-county chart of exemptions for general local sales and use taxes collected by the Department, but excluded county-collected accommodations and prepared-meals taxes.
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…
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…
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…
Is military combat pay excluded from South Carolina income when it is excluded federally?
Yes. To the extent military combat pay is nontaxable for federal income-tax purposes, the bulletin says it is also nontaxable for South Carolina income-tax purposes.
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…
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…
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.…
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…
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…
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…
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…
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…
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…
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…
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…
What documents and dates are covered by South Carolina's December 2001 advisory-opinion index?
It is a subject index of South Carolina advisory opinions and informational bulletins issued from 1987 through December 31, 2001, not substantive tax guidance.
What did South Carolina's December 2001 citator say about the status of earlier advisory opinions?
It identified opinions believed affected by later advisory opinions through December 31, 2001, but did not account for changes from statutes, regulations, or court decisions.
Could a seller use less than 33 percent of a lump-sum contract as the taxable measure for furnishing and installing an on-premise electric sign?
No. For contracts without a separately stated sign price on or after October 1, 2000, the regulation fixed the measure at exactly 33 percent.
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…
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…
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…
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