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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Was the full price of a vehicle roadside-assistance membership taxable when it bundled a mechanical-breakdown warranty with nontaxable benefits?
Yes. The entire membership charge was taxable because its mechanical-breakdown benefit was a taxable warranty or service contract and the agreement did not separately price its nontaxable roadside,…
Was a bundled charge to store, clean, maintain, inspect, deliver, retrieve, and install customer-furnished parts on hospital-owned medical equipment taxable?
No. The company provided services and installed only hospital-furnished parts on used hospital equipment; supplying its own replacement parts would probably create a taxable retail sale.
Were sales of optical equipment exempt when Chapa De Indian Health Program carried out an Indian Health Service contract under Public Law 93-638?
Yes. Chapa De was deemed a federal executive agency while performing that contract, so the optical-equipment sales were exempt under section 6381(a).
As a direct sales organization (multi-level marketing company), who is responsible for collecting and remitting Texas sales/use tax on sales made by its distributors, and how should local tax be tracked?
The direct sales organization itself — not each individual distributor — is responsible for collecting and remitting sales or use tax on Texas sales made through its distributors, per Rule…
Under Florida's 1996 intangible tax, were receivables sold before January 1 by a Florida-office parent to an out-of-state subsidiary taxable?
No. The out-of-state subsidiary owned, managed, and controlled the receivables outside Florida on January 1 and had no Florida office, assets, employees, agents, or representatives. The parent's…
Did a city's public-works equipment purchases qualify for Florida's government sales-tax exemption under its construction contract?
Not under the existing contract. The documents showed an intent for city purchases but did not clearly satisfy all six direct-purchase criteria. A conforming addendum could make the purchases…
How did Florida calculate sales or use tax on no-charge loaner vehicles provided while customers' cars were repaired?
Tax was based on the greater of the normal daily rental rate multiplied by loaner days or the internal business-expense charge recorded for the lease. The vehicles could still qualify as purchased…
Can a Utah vendor scan customer sales tax exemption certificates and store them electronically instead of keeping the paper originals?
Yes. A vendor may scan a customer's sales tax exemption certificate and store it electronically instead of keeping the paper original, as long as the electronic version captures essentially the same…
Who had to sign a Kansas vehicle-title assignment when two owners were joined by 'and' or 'and/or'?
Both listed owners had to sign when their names were joined by 'and.' When the title used 'and/or,' either owner alone—or both owners—could sign the assignment. The Department said its existing…
Did original newspapers' daily frequency prevent weekly or monthly microform and CD-ROM republications from qualifying for California's periodical exemption?
No. The republisher's frequency controlled: weekly or monthly subscription editions could qualify, while annual editions and a 64-issue package failed the frequency limit.
New York Advisory Opinion TSB-A-96(5)S: Is admission to a no-seating, no-food 1,000-capacity concert hall subject to New York's "cabaret" sales tax on admission charges, given that a cash bar accounts for roughly a third of the venue's revenue?
Not taxable as a cabaret charge -- this venue passes the "merely incidental" test its sister ruling failed. "The Music Hall," a 1,000-capacity venue, will host only touring-musician concerts, with…
How did Florida apply the county surtax $5,000 cap to computer leases under a master agreement and separate supplements?
Each supplement was a separate lease. For operating leases, the $5,000 county surtax cap applied independently to each installment. For a conditional-sale supplement with a nominal purchase option,…
I paid extra tax after an audit but before the Department issued any formal assessment notice — does my refund clock start from the audit or from the original due date?
From the audit — the producer won. BTA Oil Producers paid additional New Mexico oil and gas production taxes in October 1990 after a Department audit, remitting the underpayment shown in the…
Was a referral-fee markup added to automotive-glass parts and labor taxable in California?
The parts markup was taxable; the labor markup was not. The network was the retailer whether its own shop or an independent subcontractor did the work.
Did the FDIC, acting as receiver and not as an aircraft dealer, owe sales tax or have to collect use tax when foreign buyers took delivery in California?
No. Section 6283 exempted the nondealer sales from sales tax, and the FDIC did not have to collect use tax. The letter did not finally decide the buyers' own use-tax liability.
A towing company asks whether towing/transfer charges billed in connection with vehicle repossessions — including a "second tow" from a storage facility to an auction — are taxable debt collection services or nontaxable towing/transportation.
It depends on whether a repossession actually occurred. If a towing company is hired only to move a vehicle the lender already has access to (e.g., after the borrower voluntarily drops it at a…
A business sold all its operating assets (except two officers' cars and equipment it leased from a third party under an operating lease, which it couldn't transfer). Does the sale still qualify for the occasional sale exemption?
Yes. The Comptroller ruled that the sale still qualifies for the occasional sale exemption. The two automobiles didn't count because they were used for general business purposes, not operations. And…
We're trustees of two charitable lead annuity trusts, created under the same family trust instrument with currently identical beneficiaries, that co-own New York real property as tenants-in-common. We're proposing to combine them into one 'Surviving Trust' by court order because their income no longer covers required annual charitable payments. To protect the separate remainder beneficiaries' interests, we're setting up a detailed 'Pro Forma Account' formula (tracking what each set of beneficiaries would have received had the trusts stayed separate, adjusted for years of investment gains/losses and a complex liquidity test) plus a 'Loan-Back Agreement' so that if a 2003 distribution requires deeding out New York real property, the recipients can immediately loan the property back to the Surviving Trust. Will combining the trusts -- or the later Pro-Forma-driven mechanism -- trigger New York's Real Estate Transfer Tax or Real Property Transfer Gains Tax?
Exempt -- the proposed combination wouldn't change who beneficially owned the underlying New York real estate. Lew R. Wasserman, Jean Stein, Gerald H. Oppenheimer, and Andrew Shiva, as trustees of…
Is tire retreading for interstate common carriers subject to Kansas sales tax?
In this letter to the Kansas Tire Dealers Association, the Secretary of Revenue determined that the sale of retread tires to interstate common carriers is not subject to Kansas sales tax. Interstate…
Could a Florida county directly buy building materials for a public facility without paying sales tax under its revised purchasing procedures?
Yes. The county's direct purchases of construction materials could be exempt because it issued purchase orders, received invoices, paid vendors directly, took title at delivery, and bore insured…
Can an authorized agent for a mechanic or towing company access a protected vehicle registration record to send a legally required lien notice to the owner?
Yes. The Commission adopted a broader reading of the 'advisory notice' exception in Utah Code Ann. § 41-1a-116(4), holding it now covers not only vehicle-safety notices from manufacturers/government…
Should the Tax Commission's Auditing Division simply accept a Utah State Historic Preservation Office (SHPO) certification (Form TC-40H) as sufficient proof that a residential rehabilitation project qualifies for the historic preservation income tax credit, rather than independently second-guessing whether the work really counts as qualifying rehabilitation, and what does the credit require to begin with?
Yes. The Tax Commission's Auditing Division should accept a signed, project-numbered Form TC-40H certification from the Utah State Historic Preservation Office (SHPO) as sufficient evidence that a…
What are Utah's rules for vendor registration, exemption certificate formats (including electronic/paperless certificates), and stale-dating of resale and exemption certificates?
Utah gave a detailed, question-by-question rundown of its exemption certificate policies for a company building certificate-automation software. Vendors must register (form TC-69) if they have Utah…
Does Utah sales tax apply to a commercial printer's charges for printing grocery store advertising inserts, including artwork/prepress services, when the inserts are distributed with newspapers versus delivered directly to stores?
Printing charges are generally taxable, including folding, cutting, and addressing, and a printer buying paper, ink, or resold prepress materials can do so tax-free as resale inputs (but owes tax…
Were mutual-fund distributions directly attributable to income from U.S. Government obligations subject to Rhode Island personal income tax?
No. Interest or dividend income distributed to Rhode Island taxpayers was not subject to Rhode Island income tax to the extent it was directly attributable to the Fund's income from qualifying…
New York Advisory Opinion TSB-A-96(4)S: Are a company's "stock watch" and "NOMINEX" services -- which identify a client's beneficial stockholders and monitor changes in stock ownership -- excluded from New York sales tax as personal/individual information not incorporated into reports for other clients?
Not taxable, under the personal/individual information exclusion. Kissel-Blake, Inc. offers two services to corporate clients trying to identify their own beneficial stockholders: the "stock watch…
New York Advisory Opinion TSB-A-96(3)S: Is a proxy solicitation firm's confidential "stock watch service," which identifies a client's individual shareholders and debtholders through investigative research, excluded from New York sales tax as personal information not shared with other clients?
Not taxable, under the personal/individual information exclusion -- the same result as the companion Kissel-Blake ruling issued the same day. Morrow & Co., Inc. provides proxy solicitation and…
Were local Realtor-association and multiple-listing-service membership fees taxable because members could buy forms, books, signs, or discounted products?
No. The memberships' true object was extensive services, so incidental products and discounts did not tax the fees; separate taxable product sales remained taxable.
Were real estate association and multiple-listing-service membership fees taxable because members could buy products or receive discounts?
No. The associations were primarily service organizations, and merchandise access or discounts were incidental. Separately charged MLS books were taxable when no periodical exemption applied.
If a company owns the patents and formulas for its products but has a separate contract manufacturer physically make the product under the company's supervision, is the company itself considered the 'manufacturer' for Texas sales and use tax purposes?
Yes. Because the company developed the formulation process, supplies the manufacturing formulas and instructions, keeps its own manager/scientist on site during manufacturing and testing, and is…
Is labor to repair major appliances taxable, and does a laundry/dry cleaner that owns and rents out uniforms, mops, or linens qualify for the manufacturing exemption on its washers, dryers, and repair parts?
It depends on what's being repaired and how the appliance is used. Repair labor on tangible personal property (free-standing, plug-in appliances) is generally taxable, while repair labor on real…
Is a repossession company's charge to a bank or lender for repossessing a vehicle a taxable service, including when the bank calls off the repossession before the vehicle is picked up?
Yes. Repossession work done for a financial institution is a taxable "debt collection service" under Rule 3.354(a)(4). This applies whether the repossession is a voluntary turn-over the company…
Under Florida's 1996 intangible tax, how were receivables transferred by a Florida subsidiary to its out-of-state parent treated?
The out-of-state parent's receivables were taxable only to the extent the customers owing them were domiciled in Florida. The Florida subsidiary was not taxed on receivables transferred before…
Were five open-end loan forms used by a Florida lender subject to documentary stamp tax?
No. As presented, none of the five forms contained all three required elements of a taxable written obligation: a written promise to pay, a sum certain in money, and the borrower's signature.
Is a hotel pay-per-view video service taxable in Utah, and if the video is delivered on a physical videocassette rather than by satellite or cable, does that change the answer?
It depends on how the video reaches the guest's room, and the Commission's position changed over the course of this ruling. A company that installs pay-per-view (PPV) video systems in hotels --…
I build railroad track and separately bill my customer for materials — can I take New Mexico's railway-roadbed materials deduction on the materials portion?
No. A contractor that reconstructs railroad track is selling a construction service, not materials, so it cannot take the Section 7-9-51.1 deduction for 'materials necessary for the construction or…
Were sales of dwarf rabbits exempt even when the rabbits were sold as pets rather than for food?
Yes. California treated all rabbits, including dwarf rabbits, as food-animal life, so their sales were exempt regardless of whether the animals or their products were actually used as food.
When a company does lump-sum interior refurbishing, avionics upgrades, or performance modifications on a customer's private aircraft, is that taxable repair/remodeling labor, or nontaxable processing/manufacturing labor — and does it matter that the work is done on an unfinished ('green') aircraft versus one already in service?
Interior refurbishing and performance-altering modifications performed on an already-completed customer aircraft are repair or remodeling, not processing — and Texas law specifically excludes…
Is the labor to repair refinery/chemical plant processing equipment taxable, and is the labor to repair railroad track taxable, given that the equipment and track were exempt as manufacturing equipment or rolling stock when first purchased?
It depends on whether the item is still personal property or has become part of the realty. If refinery/plant manufacturing equipment still retains its character as tangible personal property,…
Could an exempt Florida church buy a laminated truss roof system directly from a subcontractor without paying sales tax?
Yes. The church's direct purchase was exempt because it held an exemption certificate, issued its own purchase order, paid the subcontractor directly, took title at delivery, and removed the…
Was Florida sales tax due when an insurance company paid an equipment lessor for a loader-backhoe stolen from its lessee?
No. The insurer's payment to the lessor for the stolen loader-backhoe satisfied a claim against the customer; it was not consideration for a sale under Florida's statutory definition.
Could an equipment lessor stop taxing rental receipts by making a late election to pay tax on equipment that was originally bought ex-tax?
No. After buying ex-tax and missing the first-rental-return election, the lessor had to keep collecting use tax measured by rent.
Is the computer hardware and software a company uses to draw its own blueprints for fabricating food processing equipment exempt from Texas sales tax as manufacturing equipment?
No. Preparing blueprint drawings happens before the first stage of production, so the computers and software used to create those blueprints do not qualify as exempt manufacturing equipment under…
For the affiliate that actually holds New York City IDA industrial development bonds, are the bonds (1) investment capital under section 208.5, (2) producing investment income under section 208.6, and (3) governmental securities for the Article 9-A investment allocation percentage?
Yes to all three. Smith Barney Holdings is the wholly-owned subsidiary that actually holds the New York City IDA bonds issued for the Travelers TGI Project. As in the companion opinion to its…
New York Advisory Opinion TSB-A-96(2)S: Is the fee a business pays Pitney Bowes to have its rented "Postage by Phone" meter reset by telephone subject to New York sales tax?
Taxable. Grace Borgenicht Gallery, Inc. rents a "Postage by Phone" meter from Pitney Bowes, a system that eliminates the need to have the meter reset in person at the Post Office. Instead,…
Which livestock-care, garden, and wild-bird products sold by a Florida retail feed store were exempt from sales tax?
Specified livestock medicines and supplements and qualifying seeds, fertilizers, and pesticides were exempt, with purchaser certificates required for several farm or garden uses. Wild-bird feed,…
Did a 1996 California letter extend the balloon-catheter exemption to coronary-catheter accessories and supplies?
No. The quoted amendment exempted intra-aortic balloon pump and coronary angioplasty balloon catheters but expressly taxed related supplies. The letter applied tax to guide wires, guiding catheters,…
How did California tax free pencils and merchandise offered for suggested minimum donations?
The foundation consumed tax-paid pencils given away without charge, but it was retailer of items furnished for suggested minimum donations.
Were a nonprofit's medical-supply purchases exempt because it later exported and donated them, and did its donation activity require a seller's permit?
No purchase exemption applied on the assumed facts: possession preceded irrevocable export commitment. But donating without taxable sales or leases required no seller's permit.
Which software-rental, installation, support, training, and hardware charges were taxable under the agreement?
Prewritten software and bundled services were generally taxable; true installation and optional separate consultation were not. Certain tax-paid same-form leases were excluded.
Are New York City IDA industrial development bonds (1) investment capital under section 208.5, (2) generating investment income under section 208.6, and (3) governmental securities for the Article 9-A investment allocation percentage?
Yes to all three. New York City Industrial Development Agency bonds -- the IDA being a governmental instrumentality (a public benefit corporation under Article 18-A of the General Municipal Law) --…
Under Florida's 1996 intangible tax, what happened when a Florida individual resigned as trustee and transferred all trust control to a foreign corporate trustee?
Neither the trust nor the individual's interest was taxable after the individual resigned as trustee and delegated all management and control to a foreign corporate trustee. The result required the…
Under Florida's 1996 intangible tax, were an irrevocable trust and its income beneficiary taxable when no Florida-situs person could serve as trustee?
No. The trust was not taxable because its trustee and management did not create Florida situs, and the taxpayer's income interest was not a taxable beneficial interest because the taxpayer could not…
Under Florida's 1996 intangible tax, were receivables contributed before January 1 to an out-of-state partnership taxable?
No. The out-of-state partnership's January 1 receivables were not taxable when it had no Florida connection beyond debtors, and the Florida partnership's ownership interest was exempt. Routine…
Was Florida documentary stamp tax due when articles of merger were recorded to show an LLC's succession to Florida real estate without a deed?
No. Florida imposed no documentary stamp tax when the real property passed to the surviving LLC by operation of the merger statute and only the articles of merger were recorded. If a deed were…
Were customer-modified vacation packages sold for one unitemized price subject to Florida sales tax?
No. A modified package remained untaxed when it contained multiple components sold for one unitemized price, the seller paid tax on all taxable components, and related-party components were bought…
Could a Florida amusement-machine owner assume the location owner's tax and certificate duties by written agreement while remaining the machine lessor?
Yes. A written agreement could shift responsibility for machine-receipt tax and the amusement-machine certificate to the machine owner while preserving its lessor status. The owner also owed rental…
My extra tax only got pinned down years later after the IRS adjusted my return — does interest really run all the way back to the original due date?
Yes. Interest on unpaid New Mexico income tax runs from the original due date of that tax — not from when a federal adjustment is finalized or an amended return is filed. Donald Duszynski, a New…
How did California tax Internet-access fees and CD-ROMs that were sold or given to online-service customers?
Internet-only service fees were not taxable. A separately charged CD-ROM was taxable; a truly free CD made the provider the consumer liable on its own purchase.
Is cleaning debris out of an existing farm irrigation ditch or canal every fall and spring taxable as nonresidential repair/restoration, or is it exempt agricultural maintenance?
Taxable. Cleaning debris out of an existing irrigation canal restores it to as near its original working order as possible, which is nonresidential restoration under Rule 3.357 — not exempt…
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