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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When did a sale occur for Florida tax when a seller mailed a purchase agreement and waited for the customer to sign and pay?
The sale occurred when the seller received the signed agreement and required partial or full payment, not when it mailed the blank form. Tax was computed on the full sales price at that time.
If a stereo or radio installed in a vehicle exported to Mexico gets a sales-tax refund, is the tax on the installation charge refundable too?
Yes. Because installation charges are only taxable when the underlying item is taxable, once you have proof the stereo or radio was exported and its sales tax refunded, you may refund the sales tax co…
Were international calls routed through a Florida computer switch subject to Florida sales or gross receipts tax?
No. Although the Florida switch originated or terminated call legs, the customers were outside Florida and billed abroad, so the charges were not subject to Florida sales or gross receipts tax.
Does an out-of-state manufacturer owe Texas use tax on free sample tobacco products delivered to Texas distributors?
It depends on whether the manufacturer is 'engaged in business' in Texas under Rule 3.286. If so, use tax is due on the manufacturer's cost of the taxable components (not labor) that go into the free …
Are a financial data company's broker referral premiums and its charges to participate in a computerized research directory subject to New York sales tax?
Referral premiums brokers pay for customer leads are not taxable, because customer referral is not an enumerated service. Listing research for providers is exempt advertising, but the fees receivers p…
Are a company's charges for supplying temporary environmental field technicians to prime contractors subject to New York sales tax?
It depends on the work. A temp-staffing company must collect tax on personnel who perform taxable services, but the charges are exempt when the prime contractor buys the services for resale or for a c…
Are a company's data-processing services (statements, claims, billing reports) and its microfiche-conversion service subject to New York sales tax?
It splits. Processing that produces personalized statements, claims, and account reports is an exempt personal-or-individual information service; but merely converting data to written form or printing…
Were a Florida real-estate mortgage and the secured loan exempt when the mortgagee was a federally exempt agency?
Yes. Florida found the mortgage exempt from both intangible personal property tax and documentary stamp tax because the mortgagee qualified as a federal agency with a statutory tax exemption.
Did Florida-resident grantors or an out-of-state trustee owe Florida intangible tax on trusts whose assets lacked Florida situs?
No. The trusts and assets lacked Florida situs, the trustee was outside Florida with no state office, and the grantors had no taxable beneficial interest, so neither had to file a Florida intangible r…
If an Industrial Development Board buys new equipment to replace worn-out equipment at a facility it leased to a company before Alabama's 1992 Tax Incentive Reform Act took effect, is the replacement equipment still exempt from ad valorem (property) tax?
Yes. The Department held that the replacement equipment is exempt from all taxation. Company A leased an Industrial Development Board-owned brick-manufacturing facility under a 1989 lease — before the…
Can a partnership's guaranteed payments to partners (salary-type payments and interest on capital accounts) be sourced to each partner's state of residency and excluded from the income apportioned to Utah on a composite nonresident return, and can nonresident partners in a composite filing get a personal deduction the way an individual nonresident filer would?
No, on both points. Guaranteed payments made to partners for services (or as a substitute salary) must be allocated to Utah as part of the partnership's Utah-source income under Utah Code Ann. § 59-10…
Our partnership sponsor holds 26 unsold condominium units and wants to liquidate, distributing the units to its eight partners in proportion to their ownership percentages. Because unit values don't divide evenly (especially for four partners with just 1.5% interests each), we may need side payments of cash or property to equalize the distributions, or have small partners take fractional tenant-in-common interests. Does any of this trigger New York's Real Property Transfer Gains Tax, and how would later individual sales by the partners be aggregated?
Distributing the unsold condominium units to the partners in proportion to their ownership interests is exempt from the gains tax -- but ONLY if any cash or other property used to equalize the distrib…
Does an out-of-state company that only licenses 'canned' software to Utah customers to access its data services create Utah corporate franchise tax nexus?
Yes. The Utah State Tax Commission ruled that an out-of-state database-access ('gateway') service provider was subject to Utah corporate franchise tax even without any traveling salespeople in the sta…
In computing the eligible business facility credit, can wages of employees at a separate, non-qualified branch be counted as eligible wages?
No. For the eligible business facility credit under Tax Law section 210.11, only the wages of employees serving in jobs created or retained at the certified eligible business facility count as eligibl…
Does Texas use tax apply to circuit-board prototypes an out-of-state semiconductor manufacturer ships into Texas for a customer to test, and are the customer's separate design-facility and design-library charges taxable too?
Yes for the prototypes: shipping ASIC prototype chips into Texas for a customer to test and approve is a taxable "use" of tangible personal property, and the full contract price (including the manufac…
If a customer's trade-in machine arrives after a new coin-operated machine has already been delivered, can the dealer still use the trade-in to reduce the taxable sales price?
Yes, as long as the trade-in is the same general type of item the dealer ordinarily sells (coin-operated machine for coin-operated machine) and is tied back to a specific sale. The sales order should …
What is a Mexican 'pedimento simplificado de importacion,' and what does the Mexican Trade Commission's background letter about it tell the Comptroller's office?
This isn't a taxpayer ruling -- it's a background letter that the Mexican Trade Commissioner's office in Texas forwarded to the Comptroller's Tax Administration Division, in response to the Division's…
Does a waste collection company owe Texas sales tax on the state solid-waste disposal fee and a city fee for waste containers that it passes on to customers?
Yes. Waste collection or removal is a taxable real property service in Texas, and the sales price on which tax is charged includes the total amount billed, with no deduction for expenses like the stat…
Was a debt-free mobile home's no-consideration transfer from its owners to their revocable living trust subject to Florida sales tax?
No, if documented as the described gift. The owners remained grantors, trustees, and primary beneficiaries, no debt was assumed, and a completed exemption affidavit had to accompany the title transfer…
Does Texas sales tax apply to charges for storing a motor vehicle in a general-purpose storage facility?
It depends on what is being stored. Tax Code Section 151.0101(a)(4) taxes motor vehicle parking and storage services, but it does not apply to a general-purpose storage facility where customers can st…
Our state agency is developing a new headquarters building for several commodity exchanges. Private lenders will finance construction, with us named as mortgagee even though we have no beneficial interest in the loans. Is recording those mortgages -- and any later increases in the secured debt while we remain mortgagee -- exempt from mortgage recording tax?
Exempt, including later increases in secured debt while UDC remains the named mortgagee -- this is UDC's own foundational mortgage recording tax immunity ruling, later cited directly by both its Queen…
Can a Texas border retailer accept a customs broker's certificate of exportation on an installed car radio or stereo sold to a Mexican customer, and refund the tax?
Yes, generally. The Comptroller told border radio and stereo sellers that customs brokers' certificates of exportation may be accepted on radios and stereos installed in vehicles sold to Mexican custo…
Do I need to charge Texas sales tax on an invoice when I deliver goods to a customs broker or deliver them myself for export into Mexico?
No. If you deliver the item to a customs broker for delivery into Mexico, or deliver it yourself into Mexico, you do not need to add Texas sales tax to the invoice — but you must keep proof of export,…
Can a Texas business discard paper invoices and keep only a summarized electronic 'Transaction Audit Trail' as its sales tax records?
Only if the summary keeps all the information from the original invoices. The Comptroller said records can be kept on other mediums (like microfilm or an electronic summary) as long as they stay exami…
Does a Texas grocery store owe sales tax on the trays, film, and other wrapping supplies its meat department uses to package meat it cuts, trims, or grinds?
No. Under Rule 3.314, a grocery store's meat department is "processing" meat when it cuts, trims, or grinds it, so the department can buy trays, film, meat pads, butcher paper, freezer paper, and simi…
Can a contractor and subcontractor use a private written agreement (a 'Subcontractors Acknowledgment') to shift sales tax responsibility between themselves, and will the Comptroller accept and be bound by that agreement?
No. The Comptroller will not accept or be bound by a private contract clause that shifts sales tax responsibility between a contractor and subcontractor. To determine who owes the tax, the State looks…
Is the removal, cleanup, repair, or replacement of an underground storage tank (UST) taxable in Texas, and how does the tax treatment differ for each step of the job?
It depends on which part of the job you mean. Excavating and removing an old tank is nontaxable demolition of a realty improvement, but hauling the tank away for disposal is a taxable waste removal se…
Does a company that manufactures aluminum tank domes and sometimes installs them keep its manufacturing sales-tax exemption on electricity, and is installing the dome an improvement to real property?
Installing the dome is an improvement to real property (remodeling, not new construction, on existing tanks). Electricity used to manufacture domes sold with no installation stays exempt as manufactur…
Is a computer, software, and adaptive communication equipment exempt from Texas sales tax when purchased on a doctor's prescription and paid for by a state agency's family support program?
The software and adaptive equipment for facilitated communication are exempt from Texas sales tax because they were purchased with a prescription from a licensed practitioner of the healing arts. Howe…
When a Texas manufacturer diverts self-made goods to its own use, is the cost of raw materials that were wasted or damaged during production included in the use-tax base?
It depends on whether the manufacturer can identify actual costs. If the manufacturer can track the actual cost of the raw materials that went into the specific items diverted to its own use, then was…
When did Texas exempt an ambulance or fire truck purchased by a volunteer emergency-services organization?
The exemption applied when a volunteer fire department bought the vehicle, or when an eligible § 501(c)(3) volunteer EMS provider with at least 75% unpaid staff bought it. The vehicle had to be used e…
Is a vehicle lessor's flat fee for handling registration paperwork and getting license plates subject to New York sales tax?
Not taxable, with conditions. A vehicle lessor's flat fee for preparing registration paperwork and obtaining plates is not a taxable service — as long as the charge is separately stated on the lease o…
Did Florida tax an amended note and mortgage for a Chapter 420 bond-financed affordable-housing project after default and sale?
No. Florida found the second amended and restated note exempt from nonrecurring intangible and documentary stamp taxes under the Chapter 420 housing-agency exemption.
Did a trust or its sole lifetime income beneficiary owe Florida intangible tax when the beneficiary held only a limited appointment power?
No. Florida found the trust outside the intangible tax and required no return from the trustee or beneficiary, whose income right and limited appointment power did not create the stated taxable benefi…
Did a trust or its sole lifetime income beneficiary owe Florida intangible tax when the beneficiary held only a limited appointment power?
No. Florida found the trust outside the intangible tax and required no return from the trustee or beneficiary, whose income right and limited appointment power did not create the stated taxable benefi…
Was a private country club's special member assessment to prepay mortgage debt subject to Florida sales tax?
Yes. Florida treated the required $5,000-per-member assessment used to pay club debt as a taxable periodic assessment connected with members' use of the club's recreational facilities.
Are faxed copies of a pedimento or of a Licensed Customs Broker's Export Certification acceptable proof of export for Texas sales tax purposes?
A faxed copy of a pedimento is acceptable proof of export as long as it is clearly legible, but a faxed copy of a Licensed Customs Broker's Export Certification is not acceptable — the original, prope…
Texas Letter Ruling 9303L1228F07 (1993): How do operators of Mexican aircraft document that taxable items carried as cargo were exported, and can a customs broker's certification substitute for that documentation?
Operators of Mexican aircraft can document the export of taxable items carried as cargo (not installed in the aircraft) by obtaining a Pedimento de Importaciones from Mexican customs and requesting a …
Does a company have to collect Texas sales tax on fees it charges retailers for recorded advertising spots played on a pay-per-call lottery-results phone line?
No. The Comptroller told the company that fees charged to retailers for recorded advertising spots played before the lottery numbers are not taxable, because a fee paid for advertising space is not su…
What records does a Texas retailer need to document that merchandise was exported to Mexico, and can the refund be issued as store credit instead of cash?
Attaching cash register tapes showing SKU or UPC codes to a customs broker's export certification satisfies Rule 3.323(e)(4)'s requirement for a detailed, specific description of exported items, as lo…
Does a Texas errand-running or personal-shopping business have to collect sales tax on the items it picks up or buys for customers?
It depends on the type of errand. If the customer already ordered the item and just pays you to pick it up and deliver it, your fee is a nontaxable delivery service. If you buy the item yourself on th…
If a contractor removes an entire existing driving/traffic surface (asphalt, base, and concrete) and rebuilds it, is that new construction or taxable repair/remodeling for Texas sales tax purposes?
It depends on how much of the driving surface is removed. If the complete existing driving/traffic area (asphalt, base, and concrete) is removed and replaced, the Comptroller treats the project as new…
Does a construction contract's two-year warranty period extend the time during which the contract can be renegotiated for tax purposes, and is a signed written contract required to support a tax-exempt sale to a church?
No. The Comptroller's office said a construction contract is complete once the actual construction work is finished, so a two-year warranty period does not extend the window for renegotiating the cont…
Does a foreign manufacturer's in-state technical advice exceed the protection of Public Law 86-272 and subject it to Article 9-A?
It depends on timing. A foreign (out-of-state) manufacturer that ships tangible personal property into New York is protected from the Article 9-A franchise tax by Public Law 86-272 if its New York act…
Is software licensed while it was only partly built taxable — the portion finished before the license as prewritten software, and the portion built afterward to the licensee's specs as custom software?
It splits. The roughly 60% of the software already built before the license is taxable prewritten software; the portion developed afterward to the licensee's own specifications is exempt custom softwa…
Are charges for temporary engineering-design and technical staff subject to New York sales tax?
It depends on the work, and the Department declined to rule finally. A temp-staffing charge is taxable only if the personnel perform a service New York specifically taxes; if they do, it is taxable un…
Is a private contractor's food service in a public school cafeteria exempt from Utah sales tax the way school-served meals are?
No. Utah's exemption covers only meals "served by" a public elementary or secondary school itself — it does not transfer to a private company that contracts with the school to prepare and sell the foo…
Is rodent control (structural pest control) on a farm or ranch a taxable service in Texas, and can rat poison be bought tax-free for agricultural use?
Yes, hiring someone to treat barns or storage facilities for rodents is a taxable structural pest control service in Texas, and no agricultural exemption applies to that labor. But over-the-counter ra…
Is developing and maintaining a client's confidential membership database an exempt 'personal or individual' information service, or a taxable sale?
It depends on whether each product is data conversion or a true information service, and the Department declined to classify them without more facts. Merely reformatting a client's own data is a taxab…
Are a laboratory's materials-testing and R&D reports on unique client samples subject to New York sales tax as an information service?
Not taxable. Although the reports are an information service, each one analyzes a unique client sample and is not incorporated into reports for others, so it is personal or individual in nature and ex…
Before September 1, 1991, did a software marketer owe use tax on the base bank-software it bought from its parent to customize and sub-license to end users?
Yes, on its own purchases. Under the pre-September-1991 rule, the base software the marketer bought before tailoring it to any customer was taxable tangible personal property, so its payments to the d…
Did Florida exempt shares and assets of an out-of-state municipal bond fund under its former intangible tax?
Yes, this revision answered all three exemption questions affirmatively, but it was later superseded by TAA 93C2-004S and should be read only as part of that revision history.
Did Florida documentary stamp tax apply to a note modification, out-of-state guaranty, or related UCC-1 filings?
No. The interest-and-payment modification did not enlarge principal, the out-of-state guaranty was contingent, and revised UCC-1 filings did not include the obligatory documents themselves.
If a concert venue gives a sponsor a VIP box seat and advertising in exchange for a sponsorship payment, does the venue owe sales tax on the box seat, and how much?
Yes. The Texas Comptroller ruled that a venue giving a sponsor a VIP box seat (worth $10,000, the normal selling price) in exchange for a sponsorship payment must report and remit sales tax on that am…
Does a monument/cemetery contractor owe Texas sales tax on curbing, marble, and concrete work at gravesites, and does it matter whether the work is new construction or repair of an existing site?
It depends on whether the work is new construction or repair of an existing gravesite. Setting curbing and marble right after the vault is installed is new construction, which is untaxed labor; the co…
Does a Texas sorority owe sales tax on meals served to its members, and are its membership fees and dues taxable?
Yes on the meals, no on the dues. The sorority house owes sales tax on the meals it serves to resident and guest members because Rule 3.293 taxes meals sold by boarding houses, and there's no exemptio…
When did South Carolina Revenue Ruling 93-4 treat computer-software maintenance and support contracts as taxable?
A maintenance contract sold with software was fully taxable, whether optional or mandatory. A separately sold or later contract was taxable when its true object was software or updates, but not when i…
Are Mexican citizens exempt from Texas tax on cable TV service and municipal franchise fees, and do cable companies have to collect tax on those franchise fees?
No. Mexican citizens do not get a special tax break on cable TV service. Cable companies must collect tax on the full bottom-line price of their service, including municipal franchise fees passed thro…
Does a city owe sales tax when it demolishes a structure and removes debris from a landowner's property under its police powers?
Demolishing a structure down to the slab is not a taxable service, but removing the debris is. If one combined charge covers both, the whole charge is tax-free only if the debris-removal portion is 5%…
Is the sale of a membership stock interest in a private Texas country club subject to sales tax?
It depends on who sells it. If an individual member sells his one membership stock interest directly to a new member (not habitually, and not through the club), it qualifies as an exempt occasional sa…
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