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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What does the available official PDF for South Carolina's June 1996 policy-document index contain?
The PDF says the index covered five Department document types concerning taxation from 1987 through June 30, 1996 and alcoholic-beverage licensing and regulation from July 1, 1993 through June 30,…
How did House Bill 2663 change the Kansas sand royalty effective July 1, 1996?
Effective July 1, 1996, House Bill 2663 amended K.S.A. 70a-102 to increase the sand royalty rate to $.15 per ton for sand removed, authorize the Secretary of Revenue to set by rule and regulation…
How could a purchaser withhold for successor tax liability when it paid for a business by debt credit or forgiveness rather than cash?
By reserving enough purchase consideration to satisfy the seller's tax debt. Credit or debt forgiveness still counted as consideration, and failure to make the tax available could create liability…
Could an MTE lessor end FRV reporting by selling trucks to a dealer and immediately buying them back at book value?
Not through a tax-only circular transfer. California would disregard it unless both sales had real arm's-length pricing, effect, documentation, fees, and dealer economics.
Was powdered Somatogain exempt like Ensure when its label called it a dietary supplement and showed low calories, no protein, and limited nutrients?
No. Somatogain was a powdered dietary supplement, not a complete dietary food, so its direct-to-consumer sales were taxable unlike Ensure and Ensure Plus.
How did RR 96-9 administer the historical 1% Cherokee County school sales and use tax beginning July 1, 1996?
The 1% tax applied countywide from July 1, 1996. Retailers in Cherokee County owed sales tax on covered property delivered there, while property delivered into the county could create purchaser use…
New York Advisory Opinion TSB-A-96(36)S: When Viacom finances office build-outs, equipment, and maintenance contracts through the New York City Industrial Development Agency's bond program to stay headquartered in the city, are those purchases, the resulting lease (debt-service) payments, intercompany reimbursements, the $1 buyout option, and an early-removal penalty all exempt from sales and use tax?
Yes, with one open factual question and one hard carve-out. Because title to the improvements and equipment runs through the New York City Industrial Development Agency (IDA) under General Municipal…
Does a nonprofit religious/charitable organization owe Utah sales tax on ticket sales, dutch oven meals, concession stand food, and gift shop items sold at its outdoor drama production?
It depends on the specific sale. Ticket sales for the nonprofit's own production are exempt because they directly support its educational/charitable mission — but if an outside producer rents the…
I'm buying a building and gutting it down to the four exterior walls to add a story and a half. Does that rehab count as a fresh 'qualifying capital improvement' under New York's builders' exemption from the Real Property Transfer Gains Tax, even though the building already existed before I bought it?
Yes -- the gut rehabilitation qualified. Dashal 67, LLC planned to buy a five-story building for about $2.5 million and immediately gut-rehabilitate it down to its four exterior walls while adding a…
My family's real estate partnership is splitting up: I'm taking two of our five properties into a new entity with my spouse, and my siblings are taking the other three into their own entity. Does New York's Real Property Transfer Gains Tax apply, and does the value of the ownership interest I keep for myself get taxed as part of the deal?
The full fair market value of each parcel counted as taxable consideration, but each partner's own retained percentage ownership was exempt under the 'mere change of identity or form' rule. Under…
I subdivided a parcel of land into five residential lots and I'm now selling two more of them to a builder who will build houses on them. Do I have to add up the sale prices of all the lots I've sold from this subdivision to see if I hit New York's $1 million Real Property Transfer Gains Tax threshold, or is each lot sale tested separately?
No aggregation needed -- each lot sale is tested separately. New York's now-repealed Real Property Transfer Gains Tax exempted transfers with consideration under $1 million, but ordinarily required…
For privacy, my spouse and I are having a corporation (not us personally) take title to the house we're going to live in as our home. Can that house still qualify for New York's personal-residence exemption from the Real Property Transfer Gains Tax when it's later sold?
Yes, potentially -- if the facts support it at the time of the later transfer. A married couple formed a corporation, RAI (NY), Inc., solely to hold title to a residential property for…
Does a church-sponsored youth troop need a sales tax license to sell and deliver water softener salt to neighborhood residents as a fundraiser?
It depends on the troop's exempt status, and probably needs a license. Sales by a religious or charitable organization are exempt from Utah sales tax only if the organization itself qualifies as…
How did California tax a titling trust that acquired vehicles already under continuing-sale leases?
The trust bought for resale, became lessor, needed a seller's permit and had to keep collecting use tax on rent; beneficial-interest transfers stayed unresolved.
Were containers and marine equipment exempt when customers took California possession and later moved them out of state for export loading?
No. Customer possession preceded retailer interstate shipment and irrevocable export commitment. The reseller also needed certificates and a seller's permit.
Is a mandatory $5 cleaning-and-testing fee on returnable chemical containers subject to California sales tax?
Yes. Because every buyer had to pay the container fee as a condition of purchasing the chemicals, it was an integral service charge included in the chemicals' taxable sale price.
A mobile surgery service brings a portable laser machine, disposable surgical supplies, and a technician to a physician's office so the physician can perform minor, minimally invasive surgery there. Is the total charge to the physician taxable?
Yes. The Comptroller ruled that the total charge to the health care provider — covering the laser equipment, disposable items and tools, and the technician who monitors and adjusts the laser — is…
Could freestanding cardboard standees and hanging cardboard mobiles used in businesses qualify as printed sales messages?
Yes. California treated both as functionally equivalent to posters when printed for the principal purpose of advertising or promoting goods or services.
When could California replace an automobile dealer's stated trade-in allowance with fair market value and tax the difference?
Only when evidence showed the dealer deliberately underallowed the trade-in to reduce tax. A genuine bargain or lower value caused by poor vehicle condition was not enough.
Is building, replacing, or repairing a fence around nonresidential real property taxable in Texas?
It depends on what's done. Building a brand-new fence, or replacing an entire existing fence, is nontaxable new construction (though a combined demolition/removal charge can be taxable if 5% or more…
A manufacturer's equipment lease started in 1993 and was later assigned to a new lessee, with the assignment becoming effective (per lessor approval) after the October 1, 1995 manufacturing exemption qualifying date. Does the assignment create a 'new lease' that has to meet the October 1, 1995 date to qualify for the manufacturing equipment lease exemption?
No. The original lease date (July 29, 1993) controls, not the assignment's effective or approval date. An assignment or assumption of an existing lease is not considered a new lease for purposes of…
Is a tuxedo-rental business that cleans the tuxedos it rents out entitled to Texas's manufacturing/processing exemption on its laundry equipment and supplies?
Yes. A business that cleans the tuxedos it rents out is a 'processor' for Texas tax purposes and qualifies for the manufacturing exemption: qualifying laundry/dry-cleaning equipment (washers,…
As part of a bankruptcy reorganization, we (NBC and GE) will end up as the 'owners for tax purposes' of the office condominium units we already occupy at Rockefeller Center (the GE Building and adjacent Studio/West Buildings), even though a specially formed financing trust will hold nominal legal title and lease the units back to us under 'Trust Leases' with purchase options. We'll pay all taxes, insurance, and maintenance, keep all appreciation, bear all depreciation risk, and be treated as owners for all tax purposes (though not for our own balance sheets). The financing trust's notes and mortgages that back this deal won't be recorded unless our guarantor's (GE's) credit rating drops. Does this transaction trigger the Real Estate Transfer Tax, the Real Property Transfer Gains Tax, or the Mortgage Recording Tax at any step -- the initial bankruptcy-plan transfer to the trust, the trust's lease-with-purchase-option back to us, or the unrecorded financing documents?
Exempt at every step described -- National Broadcasting Company (NBC) and General Electric Company (GE) structured a synthetic-lease financing of their Rockefeller Center office condominium…
Were a self-employed private chef's hourly cooking charges and food-cost reimbursements taxable when meals were prepared in clients' homes?
Yes. Because the chef was an independent contractor rather than an employee, the Board treated him as a caterer and taxed all charges, including food reimbursement.
Did a subsidiary's tax-free liquidation into its 100% parent under I.R.C. §§ 332 and 337 create a Tennessee excise-tax gain or loss?
No. Under the Tennessee Department of Revenue policy in effect in 1996, a subsidiary's qualifying I.R.C. §§ 332 and 337 liquidation into a parent owning at least 80% produced no gain or loss…
Was a publisher's separately shown estimated textbook freight exempt when the statewide bid used one delivered unit price?
No. The bid was a delivered price, and the invoice amount was an estimate for internal allocation rather than the publisher's actual transportation cost.
Could a taxpayer deduct tax-paid property resold without use when that resale itself was not taxable?
Yes, if the deduction otherwise qualified and the taxpayer had a taxable measure against which to take it; the deduction could not create a net refund.
Were USIA purchases in California exempt when paid through official federal procurement methods or personally by reimbursed employees?
Official U.S. purchase orders, government cards, Treasury checks, and federal wire transfers were exempt. The official annotation and supporting letter conflict on personally paid employee…
Which charges of an electronic healthcare-claims processor were taxable in California?
Claims-processing, clearinghouse, and transmission fees were nontaxable on the stated facts; archival CD-ROM fees and assumed hardware or software rentals were taxable.
Does the addition of a flash calciner unit and related equipment and modifications to an alumina and chemical processing plant qualify as exempt 'new construction' under the Increased Capacity Rule because it increases plant production capacity by about 20%?
Yes. The Comptroller confirmed that the alumina and chemical processing plant counts as a chemical processing plant under the Increased Capacity Rule (Rule 3.362), and that the new flash calciner…
Was a synthetic real-estate lease treated as taxable rent or as mortgage financing for Florida sales, stamp, and nonrecurring intangible tax?
Florida treated the recorded synthetic lease as a mortgage, not a rental. Lease payments therefore were not subject to sales tax. The recorded lease owed documentary stamp and nonrecurring…
Were Florida-customer receivables sold to an out-of-state affiliate before January 1 taxable when the Florida seller retained limited servicing duties?
No. The out-of-state affiliate owned the receivables on January 1, while the Florida seller only kept files, processed payments, sent routine notices, and reported account status. It could not…
Were receivables sold by a Florida corporation to an out-of-state affiliate before January 1 taxable when the seller performed only bookkeeping?
No, if the Florida seller performed only ministerial bookkeeping and processing while the out-of-state buyer owned all risks and control. Neither company then had to report the receivables for 1996.…
Were the original mortgage tax legends sufficient, and was a consolidation and renewal note exempt from additional Florida documentary stamp tax?
Yes. Florida agreed that documentary stamp tax had been properly paid on the original mortgages and that their legends adequately documented payment. The consolidation and modification were exempt…
Was a partnership's ratable, liability-free liquidation taxable when a trust then contributed its distributed equipment to a 95%-owned LLC?
No, on the revised hypothetical facts. A ratable partnership liquidation involved no consideration because neither partner assumed liabilities. The gift trust then transferred at least 80 percent of…
An industrial supply company runs a customer's tool crib inside the customer's manufacturing plant and charges shared-savings fees, start-up fees, transaction management fees, and contract labor reimbursement, plus sells products. Does it have to collect Texas sales tax on these charges?
Yes, generally. Presuming the industrial supply company is a retailer of the tool crib sales (not acting as the customer's purchasing agent), the shared savings fees, transaction management fees,…
How can operators of Mexican aircraft document that taxable items (cargo, repair parts) are exported from Texas so sales tax doesn't apply, and does it matter whether the aircraft is a licensed/certified carrier?
It depends on the aircraft's designation. Operators of any Mexican aircraft can document export of taxable cargo items (not installed) using a Pedimento de Importaciones from Mexican customs, but…
Is a paging service, where the pager device has a built-in transmitter that sends a location-verification signal back to the transmission equipment (but no voice or message back to the sender), subject to Texas sales tax?
Yes. Paging services are telecommunications services under Tax Code 151.0103(a), so Texas state sales tax is due on charges for all pages received in Texas, regardless of where they're…
Can a Utah county reclassify a mobile home from personal property to real property for tax purposes, and does the owner get advance notice before that happens?
A mobile home is taxed as personal property (like a car) unless the owner both owns the underlying real property AND permanently attaches the mobile home to it, in which case the owner must record…
Were royalties paid under a separate patent license included in taxable receipts from a retailer's equipment sale?
Yes. Because the purchaser could not use the equipment as intended without paying the patent royalties, all royalties—not just the retailer's 15% collection commission—entered taxable receipts.
Can a Mexican retailer who will resell the goods in Mexico buy them tax-free from a Texas seller, and if so, what documentation is required?
Yes. Effective September 1, 1995, Mexican retailers may purchase goods tax free from Texas sellers if the goods will be resold in Mexico. The retailer must properly complete a Border States Uniform…
Can a corporation use a three-factor apportionment formula instead of the single gross-receipts factor on a Texas franchise tax return?
No -- the refund was denied. A corporation filed an amended 1992 franchise tax report seeking a refund by using a three-factor apportionment formula instead of the single gross-receipts factor for…
Did California's out-of-state-use exclusion apply when component title passed through a California sales office?
No. Title passage made it a California sale subject to sales tax, while section 6009.1 excluded only use tax. Outside title passage could allow the exclusion if California use was solely qualifying…
Did section 6009.1 exempt imported parts bought through a California sales office and incorporated here into equipment used out of state?
No, when title passed in California, because section 6009.1 excludes qualifying use but not an in-state sale. Out-of-state title passage could change the result.
Did sending employees into California to install displays require an out-of-state seller to collect use tax?
Yes under the historical rule applied. Employee installation in California was physical presence under section 6203(b), requiring registration and use-tax collection on California sales.
Is a contract to add square footage to an existing building taxed as new construction, or as taxable repair/remodeling like a roof repair or HVAC replacement?
Building an addition onto an existing nonresidential structure (or building a new structure) is new construction under Rule 3.291, not repair/remodeling — so under a lump-sum contract the contractor…
Is a lump-sum contract to repaint condominium/apartment buildings taxable, and does the contractor need a sales tax exemption certificate from the condo association?
No sales tax exemption certificate is needed. Repainting a condo/apartment building under a lump-sum contract is a nontaxable repair to residential real property — the contractor pays tax on the…
Who owed Tennessee sales or use tax when a contractor custom fabricated awnings and permanently installed them on customers' buildings?
The awning contractor had to pay sales or use tax on its raw materials and could not buy them with a resale certificate. It did not charge customers sales tax on the lump-sum price for the custom…
How does the 18-month window for using a replaced vehicle toward a fair market value deduction get calculated, and what date counts as the start of that clock?
The 18-month period for using a replaced vehicle as a fair market value deduction starts on the date the vehicle is retired from service — not on the date it is later sold. A 'new vehicle' for this…
Were common-area maintenance, insurance, and promotional payments between shopping-center parcel owners taxable as real-property rent?
No. The retailers owned their own parcels and paid the developer under reciprocal easement agreements for common-area maintenance, insurance, and promotion. Those payments supported property…
Can a manufactured-housing contractor pay Utah use tax on just the raw-material percentage of prefabricated home panels shipped in from out of state, the same way a site-built home is only taxed on materials?
No -- the contractor's requested materials-only formula was rejected. A real property contractor who buys prefabricated "panelized" home sections from an out-of-state factory owes Utah use tax on…
Did use tax apply when a foreign corporation transferred its debt-free vessel outside California solely for first-issue stock of a new corporation with the same sole owner?
No under counsel's assumptions. The vessel assignment would occur outside California solely for the commencing Delaware corporation's first-issue stock, with no debt assumption or other…
Could a dealer rely on an auction house's blanket resale certificate when the certificate named the auction rather than the dealer as seller?
No. The auction house acted as the dealer's agent, so the dealership was the seller and had to be named on the blanket resale certificate. The required resale-certificate wording could be…
Is boarding and training other people's horses 'agricultural production,' so that the operator can get a Farmer Tax Exemption Permit even though it sells no animals or produce?
Yes. Boarding and training horses that belong to others is 'agricultural production' under Conn. Gen. Stat. § 12-412(63), because the statute's definition -- raising, feeding, caring for, training,…
Could a printed-message seller satisfy the common-carrier delivery requirement by using its own separately contracted and invoiced licensed-carrier operation?
No. California required the carrier to be a different entity from the seller or purchaser, regardless of pre-delivery title passage or separate carrier contracts and invoices.
Is a geocoding service — manually matching bus-ridership survey answers to numbered map locations for an out-of-state (Washington) firm, with no computer involved — subject to Texas sales/use tax?
No. The Comptroller held that this geocoding service is not subject to Texas sales/use tax.
Is nonalcoholic beer subject to Texas sales tax, or is it taxed under the Texas alcoholic beverage tax instead?
Nonalcoholic beer is subject to Texas sales or use tax, taxed the same way as other soft drinks or sodas, regardless of brand or type. It is NOT subject to Texas alcoholic beverage taxes. However,…
Did intangibles and a promissory note between two out-of-state affiliates acquire Florida situs when one performed directed processing work?
No. The affiliate managed and controlled the intangibles from outside Florida, while the seller performed only directed bookkeeping, collection, and processing without independent judgment. The…
Could a corporate group discontinue Florida consolidated filing after extensive business and entity changes distorted its apportionment factors?
Yes, subject to four conditions. Deconsolidation applied for the year ended June 30, 1995; there could be no later-benefiting unrecognized items; the separate-versus-pro-forma consolidated…
Are down-hole labor charges performed in conjunction with drilling a new oil or gas well subject to Texas sales tax if they occur a short time after the well's Railroad Commission (RRC) completion date?
Yes, they're taxable. Down-hole new construction on a new well is considered complete once the Texas Railroad Commission certifies the well completed for production. Any down-hole labor charges…
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