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 Florida value mutual-fund shares for the 1994 annual intangible tax?
The Department confirmed that valuation used the fund's January 1 holdings and that shareholder exemption was proportional to qualifying exempt government obligations held that day. Private-entity bon…
Was full documentary stamp tax due when the company deeded encumbered property to its trust?
No. Florida required only the minimum documentary stamp tax when the company transferred the encumbered property to a real estate trust of which it remained the sole beneficiary under the court-approv…
If I sell petroleum products to out-of-state customers with title transferring inside a Texas pipeline, do I owe Texas sales tax, and what proof do I need that the product left the state?
Crude oil is not subject to Texas limited sales, excise, and use tax at all. Processed oil, natural gas, and other petroleum products are taxable unless the customer resells them (resale certificate) …
Is 'third-party installation' a valid reason to claim a Texas sales tax exemption?
No. "Third-party installation" by itself is not a valid exemption certificate reason. True third-party installation labor (by an entity that did not sell the item) is not taxable, but some third-party…
Are parts and labor used to repair or refurbish railroad cars and locomotives exempt from Texas sales tax?
Yes. Locomotives and railcars (complete with the truck) are exempt from Texas sales tax when purchased or sold, and the labor and parts used to repair them are also exempt, with no exemption certifica…
If I supply mobile vendors, do I have to remit tax on sales to vendors who now operate independently of my company instead of exclusively under me?
It depends on whether the mobile vendor is still connected to the supplier. Under Comptroller Rule 3.293, a supplier must remit tax on sales to mobile vendors who still operate under it (e.g., connect…
Can the Department substitute a credit toward a taxpayer's future sales tax bill instead of issuing a cash refund, when the taxpayer specifically requested a refund on Form AU-11 for overpaid sales tax on manufacturing electricity?
No. Once a taxpayer checks the 'Refund Claimed' box on Form AU-11 and is found entitled to it, the Department cannot substitute a credit toward future tax payments instead, without the taxpayer's cons…
When a trucking company temporarily stores goods 'in transit' while waiting for delivery instructions, does that storage make its transportation charges taxable, and when does the storage itself become taxable?
Transportation charges stay untaxed either way, but in-transit storage over 30 days becomes taxable on its own -- and if that taxable storage charge isn't separately stated from the untaxed transporta…
When a business-forms company acts as a single 'facilitator' ordering supplies from third-party vendors and drop-shipping them to its own customers, who collects sales tax -- and is the fee for its ordering software and invoicing service itself taxable?
The facilitator buys tax-free for resale from third-party suppliers (using a resale certificate) but must itself separately state and collect the actual sales tax from its customer -- a bundled 'vendo…
Are building and environmental inspection services (including Phase I Environmental Inspections) taxable in Texas?
No. The Texas Comptroller ruled that the taxpayer's inspection services -- including building inspections for repair and maintenance needs, report writing, material sample testing, specification prepa…
Is scanning paper documents onto CDs a taxable service in Texas?
Yes — electronic document scanning/imaging is taxable as a data processing service under Rule 3.330; you must collect sales tax on your total charge to the customer.
Is a light-bulb-replacement maintenance service taxable in Texas if I only provide labor, not bulbs?
Yes — lighting maintenance (including bulb replacement) is a taxable real property service under Rule 3.356(a)(7), even if you provide only labor and no materials.
Is selling coupon books or passbooks taxable under Texas sales tax?
No — the Texas Comptroller ruled that selling a book of discount coupons (a 'passbook') is considered the sale of an intangible, not tangible personal property, so Texas sales tax does not apply to th…
Could an unlicensed carrier recover tax on fuel later used by refrigerated trailer units?
No. Because the carrier was not licensed as a special-fuel dealer and bought tax-paid fuel into bulk storage, it could not claim a refund or credit for reefer use, obtain a retroactive dealer license,…
Texas Letter Ruling 9409L1316G12: Racetracks — Leased By Exempt Organization To Hold Event — Taxability Of Ticket Sales And Rental Fee/Proceeds Received By Nonexempt Lessor
The rental fee a racetrack owner receives from a nonprofit that leases the track (a percentage of net sales) is not subject to sales tax, and the nonprofit's ticket sales to the event are also exempt …
Is a yacht club condominium a taxable social/athletic club, is the sale of a boat-slip condo unit itself taxable, and can the condo buy maintenance services tax-free for resale when it bills unit owners for maintenance?
The condo IS a social/athletic club, so its Common Expense assessments to unit owners are taxable dues -- but a slip unit's sale is an untaxed real property sale. Maintenance work billed for one owner…
Was the monthly bacterial grease-control and wastewater-maintenance service taxable?
No. Florida treated the monthly work as a nontaxable personal service and lump-sum maintenance of real property, not a pump rental. The company remained responsible for sales tax on equipment, materia…
Our company runs a state agency's electronic benefits transfer (EBT) system under contract — is that a taxable data processing service, do we owe sales tax on our fee to the exempt state agency, and can we buy supplies, cards, and outside services tax-free using resale certificates?
Yes — running a state agency's electronic benefits transfer (EBT) system is a taxable 'data processing service' under Texas law, but because the purchasing agency (TDHS) is tax-exempt, the contractor …
When a county raises its local sales tax rate, do equipment lease payments made AFTER the rate increase get taxed at the new higher rate, even though the lease agreement itself was signed before the increase took effect?
Yes. Each rental payment is taxed at the rate in effect when that specific payment is made, not the rate in effect when the lease was originally signed -- so payments made after a local rate increase …
Were lending notes and other receivables taxable after sale to a foreign affiliate before January 1?
No. The foreign affiliate's purchased receivables had no Florida tax situs, and the Florida seller no longer owned them on January 1. The affiliate's promissory note was taxable but was eliminated if …
Did Florida's 1994 intangible tax apply after receivables were sold to a new out-of-state affiliate?
No. Receivables sold before January 1 to the planned out-of-state affiliate with no Florida business situs were not taxed to either corporation. The seller's note was taxable by itself but excluded as…
Did Florida's 1994 intangible tax apply after receivables were sold out of state before January 1?
No. Receivables sold before January 1 to an out-of-state affiliate with no Florida business situs were not taxed to either corporation. The seller's note was taxable by itself but excluded as an inter…
Are 'outplacement services' — counseling laid-off executives to find new jobs, paid for by their former employer — taxable in Connecticut as business management consulting or as employment-agency services?
No — outplacement services are not taxable in Connecticut, under either category considered. Counseling an employer's terminated executives/managers to help them find NEW jobs is NOT taxable 'personne…
Does making floral arrangements count as "processing" for Texas utility sales tax exemption purposes?
Yes. The Comptroller's letter states that the activity of making a floral arrangement is considered processing. The taxpayer had asked about the taxability of natural gas and electricity (utilities) u…
Does a National Park Service concessioner owe sales tax on materials and services it buys to repair, maintain, and improve government-owned facilities under its concession contract and city license agreement?
Materials that become an integral, permanent part of government-owned property (federal or City) can be bought tax-free, and services genuinely resold to the government are exempt too -- but any mater…
Does Utah sales tax apply to installed swimming pool cover systems, and does an out-of-state auto-parts locator service with no Utah office or employees owe Utah franchise or income tax?
Two separate advisory opinions are bundled in this record. Installed swimming pool covers become part of the real property, so the installer (not the pool owner) owes sales/use tax on the materials, a…
Does vibration-monitoring equipment bought by petroleum processors or electricity generators to protect manufacturing machinery from damage qualify for the Texas manufacturing sales tax exemption?
No. The Comptroller ruled that vibration-monitoring equipment used to detect excessive vibration and trigger safety shutdowns does not qualify for the Texas manufacturing exemption. It is not an 'acce…
Is telemarketing taxable in Texas?
It depends on what the telemarketing calls actually do. (1) Using an automated computer system to call people and deliver standardized messages is a taxable telecommunications service. (2) Making call…
Is cleaning, painting, and sealing residential air vents/ducts taxable in Texas?
No, not when paint and sealing are involved. The Comptroller reconsidered an earlier ruling that soot-cleaning of vents/ducts was taxable janitorial work, and concluded that when the service also incl…
How does Texas decide whether a bed-and-breakfast pays residential or commercial (nonresidential) tax on its gas and electricity?
Texas applies a 'predominant use' test. If 50% or more of a bed-and-breakfast's square footage is rented out (or the rooms are offered for rent 50% or more of the year), the property is treated as non…
What documentary stamp tax applied to the trustee and title-clearing hotel-property deeds?
Only the minimum tax applied. That result covered the bank trustee's deed to either a successor trustee or the trust's sole corporate beneficiary, and the Tribe's quitclaim deed to either recipient to…
Is drafting, marine surveying, marine appraisal, or marine architecture/engineering/consulting work taxable under Texas sales tax?
It depends on who develops the design and why the survey is done. Drafting is taxed as the sale of graphic art only when the customer supplies all the schematics and specifications and the drafter mer…
Could the jewelry seller collect Florida sales tax for its independent home-show retailers?
Yes. The seller could collect tax from independent retailers at wholesale based on the suggested retail price when that was the actual sales price, avoiding retailer registration. A retailer choosing …
In a combined Article 9-A report, must the parent still add back interest on debt used to acquire a subsidiary that is itself included in the combined group?
It is handled at two levels. When parent P and subsidiary S file a combined Article 9-A report, each must also file its own separate report. On P's separate report, P must make the section 208.9(b)(6)…
If a registered/professional engineer performs forensic investigations of accidents, fires, or structural damage in connection with an insurance claim, does Texas sales tax apply to that service?
Yes. The Comptroller ruled that nothing in the Texas Engineering Practice Act (Article 3271a) or Chapter 151 of the Tax Code exempts a registered/professional engineer from charging and collecting sal…
Can a non-Texas retailer use a multi-jurisdictional resale certificate instead of a Texas Resale Certificate when buying from Texas vendors?
Probably not safely. A multi-jurisdictional resale/exemption certificate (even paired with an affidavit) is likely incomplete under Texas law and probably would not protect a Texas vendor from tax lia…
Does tri-ethylene glycol (TEG) used in natural gas processing qualify for the Texas manufacturing sales tax exemption?
It depends on how the chemical is used. Tri-ethylene glycol (TEG) used like anti-freeze in a pipeline that transports natural gas to an end marketer does NOT qualify for the manufacturing exemption, b…
Were separately stated electronic market-data services subject to Florida sales tax?
No. Florida treated the basic and optional financial information transmitted to customer display screens as nontaxable services. Separately charged computer-terminal leases remained taxable, and tax p…
New York Advisory Opinion TSB-A-95(34)S: Is the charge for a 24/7 personal emergency response ("medical alert") system -- a wearable pendant and sending unit that lets customers summon help -- exempt from New York sales tax?
Exempt. MSS Electronics Inc. provides "LifeFone," a 24-hour, 7-day-a-week personal emergency response system that lets customers summon help at any time. Customers give Petitioner information about th…
Was insurance premium tax due on city-funded health claims paid by the plan administrator?
No. Florida concluded that life and health self-insurers were not insurers subject to section 624.509, so the city-funded claims did not create insurance premium tax. This ruling revised and withdrew …
Is a separately-stated property tax reimbursement on an equipment rental invoice taxable in Texas?
It depends on what the reimbursement covers. A property tax reimbursement is excluded from the taxable sales price of an equipment rental only when it is (1) separately stated and clearly identified o…
If my company makes and installs fireplace facings or mantles for home builders, is the whole charge (materials, labor, overhead, markup) taxable as a sale of tangible personal property, or is it a nontaxable real property improvement?
It depends on the contract with the home builder. If the facing/mantle is simply sold, or installed without becoming a permanent improvement to the home, the company is a manufacturer selling taxable …
Can New York State withhold a wife's share of a joint personal income tax refund and apply it against a sales tax assessment owed individually by her husband alone?
No. Under Tax Law § 686(a), the Commissioner may only credit an overpayment against a liability owed by 'the person who made the overpayment.' Although Tax Law § 651(b)(2) makes joint filers' income t…
After moving away from New York and building a life in New Jersey for 14 years, does building a family home back in New York (where the taxpayer's spouse and children now live) mean the taxpayer has become domiciled in New York again for income tax purposes?
The Department would not say. It explained New York's full legal test for domicile and for changing domicile, but concluded that whether this taxpayer's 1986 New York house revived his New York domici…
Could a Texas vehicle rental or leasing business split one retired vehicle's fair market value deduction between two replacement vehicles?
No. Section 152.002(c) allowed the retired vehicle's fair market value to reduce the taxable value of one replacement vehicle only. The deduction could not be split between two purchases, and any unus…
When a contractor issues a change order on a nonresidential repair or remodeling contract, is the change order taxed the same way as the original contract, and when does the contractor become liable to collect the sales tax?
Yes, change orders are taxable in the same manner as the original nonresidential repair or remodeling contract. A change order that does not alter the sales price causes no change in tax owed, but a c…
Do clean-room air handling systems and floor panels qualify for Texas's manufacturing exemption in semiconductor fabrication?
Yes — the Comptroller confirmed that air handling equipment, ceiling vents, and waffle floor panels used in semiconductor (microchip) fabrication clean rooms qualify as equipment used in manufacturing…
If I bundle a cellular phone's price with the cost of service, does that affect my use tax liability on the phone?
No — a cellular phone service provider that gives a phone to a customer as part of its taxable telecommunications service may buy that phone for resale, regardless of what price it places on the phone…
Who owed Florida sales or use tax on materials for a municipal utility's lump-sum public-works contract?
The contractor did. Florida treated the contractor as the ultimate consumer of the materials and supplies, including room air conditioners, because it bore the risk of loss under the lump-sum public-w…
Did a Florida municipal utility owe sales tax on a lump-sum performance-testing contract and its reports and manuals?
No. Florida treated the contract as an exempt professional service and did not tax the reports and manuals furnished to the utility and its engineer without a separate charge. The consultant still owe…
Did a dealer-lessor and a second lessor each owe Texas vehicle tax when the leased vehicle and contract were sold days after lease inception?
Yes. Entering the operating lease was taxable use, making the dealer-lessor's acquisition taxable. Its later sale of the leased vehicle to a second lessor was another taxable sale. The lessee's vehicl…
Do dedicated telecom lines used to transmit news content to a printing plant qualify for Texas's manufacturing exemption?
No — the Comptroller ruled the telecommunication service is taxable because it is not performed directly on the newspaper being manufactured; merely facilitating the manufacturing process is not enoug…
Had the proper Florida documentary stamp tax been paid on the consolidated note, mortgage, and related loan documents?
Yes. Based on the submitted loan documents and facts, Florida concluded that the appropriate documentary stamp tax had been paid. The restated assignment of rents served as additional collateral for t…
Is providing a portable surgical laser with an operating technician a taxable equipment rental in Texas?
Yes — the entire charge is taxable as a rental of tangible personal property, even though a technician sets up, tunes, and operates the laser while the physician performs the actual procedure. An exem…
Does processing a neighbor's agricultural products alongside my own destroy my Texas manufacturing-exemption for my processing equipment?
Not entirely, under the policy this letter recommends. The Comptroller's task force proposed replacing the old all-or-nothing rule (which required that 100% of the products processed, packed, or marke…
Is a software modification delivered out-of-state and brought into Texas on diskette taxable?
It depends on who made the modification. If the same company that sold the original computer program also created the modification, the modification is taxable when brought into Texas on diskette only…
Are environmental testing, waste analysis, and disposal services for underground storage tank (UST) remediation taxable in Texas?
Mostly nontaxable, with two important exceptions. Invoice-by-invoice, the Comptroller found that environmental sampling, lab analysis, waste-stream review, and disposal-approval services related to un…
Is a not-for-profit workers'-compensation and risk-management association, formed by a statewide association of municipalities exclusively for its member cities and villages, exempt from New York sales and use tax on its own purchases as an 'instrumentality of the State'?
Yes. Because the association performs a governmental function for its municipal members, is controlled by them, has no private ownership interest, was created under specific statutory authority, and i…
If a utility bills a homeowner's backyard hot tub at a commercial 'general secondary' rate (because it's on a separate meter), does that override the tax-law rule that residential recreational equipment gets the reduced or exempt residential energy sales tax rate?
No. A utility's own billing-rate classification doesn't control the sales tax outcome -- personal, non-commercial residential recreational equipment like a backyard hot tub still qualifies for the res…
Who had to report consignment-auction accounts receivable for Florida's annual intangible tax?
The consignors were primarily responsible for reporting their January 1 accounts receivable, including non-Florida consignors whose receivables were managed in Florida by the auction company. If a con…
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