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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Could a club buy landscaping and repair services tax-free when maintaining a municipal park under contract with a city?
Yes. Services for the city-owned park were exempt when identified on an exemption certificate; any refund had to come from the provider to the entity that paid the tax.
Were charges for adding local contact information to a network video feed and for recording a satellite program taxable in Texas?
The tagging charge was not taxable when information was added to a network feed, but the charge for videotaping a satellite program was taxable.
Who had to collect and remit Texas sales tax on janitorial services performed by franchisees?
The franchisor. The Comptroller treated it as the retailer and required it to hold a permit and collect and remit all tax due on franchisee services.
Were services to collect delinquent real-property rent and medical bills subject to Texas sales tax?
Yes. Although rent and medical services were not taxable, activities performed to collect or adjust those past-due debts were taxable debt-collection services.
How did Texas tax a purchased portfolio of peanut- and cotton-wagon agreements?
Continuing the manufacturer's original agreements kept them as rentals, requiring a retailer permit and tax on cooperative rentals while qualifying farmer rentals could be exempt. New or renegotiated …
Could a newsletter publisher buy film, film processing, and desktop publishing services for resale without Texas sales tax?
No. Those inputs were not transferred into the subscribers' care, custody, and control, so they did not qualify as purchases for resale under Rule 3.342(e).
Was a magazine with mostly free one-year subscriptions a controlled-circulation publication, and what Texas tax applied?
No. The paid subscriptions showed the magazine was published for subscription sale; paid subscriptions were not taxable, but the publisher owed tax on free copies mailed to Texas subscribers.
Would a church lose the Texas exemption for its centennial history book by hiring an outside professional printer?
No. The church still qualified if it published and distributed the book; using an unaffiliated professional printer did not defeat the exemption.
Was flexlight used as a printing plate exempt from Texas sales tax when a printer manufactured products for sale?
Yes. It was necessary and essential to manufacturing and was neither machinery nor equipment under Rule 3.300(a), so the six-month useful-life test did not apply.
Did Texas exempt labor to repair real-property pollution-control equipment, and what refund applied to replacement wastewater piping?
No exemption applied to real-property repair labor. Pipe bought in 1990 or 1991 qualified for a 25% state-tax refund, but removal and replacement labor did not if the system was an improvement to real…
In a sale-leaseback, does property a company sells and leases back count as 'investment' for Nebraska's LB 775 incentive?
Only if it was first put into service after the application. Under Revenue Ruling 29-91-3, when a taxpayer leases property in a sale-leaseback that it previously owned, that property qualifies as 'inv…
Which personal property in ABC's headquarters expansion qualified for the historical SC headquarters credit under PLR 91-3?
Personal property used by employees performing headquarters functions or qualifying experimental software research and development qualified. Property for custom client programming, installations, cus…
Was a Network WATS subscription fee excluded from Texas sales tax because it was separately named and was not a local-access or equipment charge?
No. Telecommunications services were taxable items, so the total charge was taxable unless a component had its own exemption; renaming the charge did not exempt it.
My client can't keep up with interest payments on two large mortgages. The bank will agree to defer the unpaid interest, but only if additional interest accrues on that unpaid interest (compounding), while the mortgages' already-taxed maximum principal caps stay the same. Does adding compound interest to the mortgage trigger additional mortgage recording tax?
No additional tax due -- but only because the compounded amount stays within the mortgage's already-taxed maximum, and there's an important enforcement trap lurking underneath. A client held real prop…
When a New York S corporation reincorporates into a different state through a tax-free F-reorganization merger, does its New York S election survive, or do the shareholders have to make a brand-new election and file two short-period corporate returns?
The S election itself survives, but two short-period corporate franchise tax returns are still required. X Corp, a New York corporation that had elected both federal and New York S status, will merge …
Were freelance photographer charges to a Texas video production company taxable, and did camera ownership or an exempt client change the result?
Motion-picture or video-camera work was nontaxable, but still-camera work was taxable. Camera ownership and producing the master for an exempt entity did not change the result.
When a hotel stay lasts more than 30 consecutive days, does Connecticut's room occupancy tax still apply to the first 30 days?
Historical rule -- this Ruling has since been OBSOLETED by Announcement 94(8) and no longer states current law, so confirm the current treatment before relying on it. A hotel agreed to provide lodging…
How did Kansas's 3.5% short-term vehicle rental excise tax work beginning July 1, 1991?
Effective July 1, 1991, Kansas imposed a 3.5% excise tax on gross receipts from motor-vehicle rentals or leases lasting 28 days or less, in addition to state and local sales tax. The base included the…
Did the Texas residential-use exemption cover electricity and natural gas for a mental hospital where patients stayed 30 to 90 days?
No. Rule 3.295's residential-use exemption did not apply to health-care facilities, and the patients' 30-to-90-day stays did not make the hospital a residence.
Are weekly rentals of self-contained motel housekeeping/efficiency units subject to New York sales tax when no hotel services are provided?
Not taxable, on these facts. The Juliana Motel rents housekeeping and efficiency units — each with its own kitchen, bathroom, and sleeping room and no services provided — on a weekly basis through the…
As bankruptcy trustee for 68 limited partnerships, I'm selling their real estate free and clear of liens under court order, with liens attaching instead to the sale proceeds. Depending on whether the buyer is a stranger to the mortgage, partially assumes it, or is the mortgage-holder itself credit-bidding at a bankruptcy auction, how is 'consideration' calculated for New York's Real Property Transfer Gains Tax in each scenario?
Consideration is calculated differently in each of the three scenarios -- the price actually paid if the buyer doesn't touch the mortgage, price paid plus the assumed portion if the buyer partially as…
Did common ownership exempt motor-vehicle and equipment leases between sister corporations from Texas tax?
No. The intercorporate-services exemption did not cover those leases; motor vehicles and financed equipment followed their ordinary tax rules despite common ownership.
Which Texas charges for computer consulting, data processing, custom programming, and software modification were taxable?
Standalone consulting and qualifying custom programming were nontaxable, but data processing and software sales were taxable; lumping taxable and unrelated services made the full charge taxable.
Was equipment temporarily assembled in Texas before shipment for use solely in Oklahoma subject to Texas sales or use tax?
It depended on origin. Out-of-state equipment could qualify for the temporary-storage use-tax exclusion, but equipment shipped from within Texas remained subject to sales tax.
Was a charge to paint pictures on a person's face subject to Texas sales tax?
No. The face-painting charge was not taxable, but the provider had to pay sales tax on all supplies used to paint customers' faces.
Were trolley fares subject to Texas sales tax when the trolley provided public transportation or an amusement ride?
Public-street transportation fares were not taxable, but operating on private property as an amusement ride or providing tour guides was a taxable amusement service.
When did SC Revenue Ruling 91-9 tax lease payments for tangible personal property delivered in or later brought into South Carolina?
In-state delivery from a South Carolina lessor made every lease payment taxable even if the lessee immediately moved the property out of state. Lessor-required out-of-state delivery made the payments …
Which components of a municipal water-treatment-plant expansion qualified for the manufacturing-machine sales-tax exemption under SC RR 91-8?
Equipment within the processing window—from the rapid-mix tank through final filtration—generally qualified, including mixers, flocculators, sludge machinery, processing piping, filter tanks, media fi…
Is Texas motor vehicle tax due when a dissolving corporation distributes a vehicle to a stockholder as part of the stockholder's liquidation share?
No tax was due when a dissolving corporation transferred a vehicle to a stockholder as part of the stockholder's liquidation share, provided there was no consideration or lien assumption. The letter's…
How did Texas tax discount-travel memberships, amusement components, travel certificates, and promotional giveaways?
Discount memberships and qualifying travel certificates were not taxable, but amusement components and the promoter's printed certificates and giveaways were taxed under different rules.
Was installing or changing an artificial-lift system on a Texas oil well taxable?
The first installation was nontaxable, but changing or converting an existing well from one artificial-lift method to another was taxable remodeling.
Could a homeowners association use Texas's prior-contract exemption for trash service it purchased and separately billed to members?
No for the separately billed trash service. The HOA was the seller, had to buy for resale, and could not use the prior-contract exemption for that purchase.
Could a company using a thirteen-period fiscal calendar file Texas sales-tax returns on that accounting cycle?
It could use its fiscal calendar only by mapping the periods into 12 calendar-month returns, observing the fixed due dates, and leaving preprinted report-period dates unchanged.
Did Texas sales tax apply when a dissolving partnership distributed equipment to its partners, who contributed it to wholly owned professional associations?
No. Neither transfer involved consideration, so neither was a sale; no additional tax was due after tax had been paid on the original purchases.
Could a cellular provider buy a flat-fee call-forwarding roaming feature tax-free for resale when it bundled the feature into taxable service?
Yes. Because the roaming feature was provided as part of the telecommunications service sold to each customer, the provider could issue a resale certificate.
Was labor to operate another company's machine and perforate that company's vinyl sheeting taxable in Texas?
Yes. The work was taxable processing of tangible personal property, unless the vinyl owner resold the material and issued a valid resale certificate.
Could sales tax be refunded on natural gas used by an apartment-complex boiler to provide residential hot water?
Yes. State, city, and MTA tax paid within the limitations period could be refunded based on the stated residential-only use.
When could a Texas seller accept a resale or exemption certificate in good faith, and could the purchaser invoke good faith when issuing it?
The purchaser could not invoke good faith. A seller needed a timely, facially valid certificate and no knowledge that the claimed resale or exemption was improper.
Could restaurants buy disposable paper placemats tax-free with a Texas resale certificate?
Yes. Nonreusable placemats furnished to customers could be purchased for resale whether they were plain, decorative, or carried advertising.
Did Texas's agricultural exemption apply to machinery and equipment used by an original-producer shrimp farm?
Yes under the 1991 letter. STAR warns that a 2011 law later required a Comptroller registration number for certain agricultural and timber exemptions.
Which of a property manager's charges — management fees versus cleaning, repair, and maintenance — are subject to New York sales tax?
It splits by the type of service — and separate billing matters. Certified Properties manages apartments and houses. Its core management services — renting units and signing leases, collecting and dep…
Is a company's charge to remove a wheel 'boot' from an illegally parked car subject to New York sales tax — as a parking service or as servicing tangible personal property?
The boot-removal fee is taxable — but not as a parking service. A-Z Parking runs a private-property enforcement program: its teams place an immobilizing wheel 'boot' on unauthorized vehicles, and the …
Are a mutual fund's exempt-interest dividends derived from Puerto Rico obligations subject to Connecticut's dividend and interest income tax?
Exempt -- but this concerns a Connecticut tax that no longer applies in this form (the ruling is obsoleted by AN 94(2), obsoleted in part by PA 94-4 § 13, and superseded in part by SN 95(17)), so trea…
Which league, tournament, admission, and sports-participation charges were taxable in Kansas?
Kansas taxed fees charged by private clubs, organizations, and businesses for participation in sports, games, and recreation, including league or tournament fees collected from individuals or teams. A…
Was construction for a private golf-course lessee exempt because the city owned the land and would receive the building when the lease ended?
No. The contractor's customer was the nonexempt lessee, which had sole use and benefit during the lease, so ordinary separated- or lump-sum contract rules applied.
Did a registered massage therapist or the hotel where the therapist worked have to collect Texas sales tax on massage services in 1991?
No. As of February 1, 1991, neither the registered therapist nor the hotel had to collect tax on the massage services described.
Are charges for placing advertisements on the sides of trailer-trucks subject to Connecticut sales tax as advertising services?
Not taxable -- it counts as media advertising. A company charged for placing advertisements on the sides of its trailer-trucks. Connecticut taxes advertising services only when they are NOT related to…
Were charges for proprietary telephone-survey results taxable as Texas information services?
No. The work was an information service, but the customer charge was nontaxable because the information was proprietary; the provider still paid tax on taxable inputs.
How could a customer seek a Texas sales-tax refund after taking possession in Texas and exporting the goods to Canada?
The customer needed Canadian customs entry documents and purchase receipts showing import within 30 days, then had to request a refund from each merchant.
Did a city have to collect Texas tax when it repaired sidewalks or drive approaches and billed residential or commercial property owners?
Treatment depended on the property and right-of-way. Accepted city rights-of-way were exempt; private residential lump sums were not collected, while private commercial work was taxable.
How did Texas classify 900-number access, cellular and messaging services, online information, modem services, and merchandise sold through a 900 number?
The letter classified each offering by service type; 900-number access was telecommunications, and the provider also had to collect tax on taxable merchandise sold through the number.
Could a customs cartman who was not a licensed U.S. Customs Broker certify Texas sales-tax exports to Mexico?
No. The cartman could not certify the export, but could document it by returning a Mexican customs pedimento de importaciones to the customer.
Were copyrighted-image license fees, image-research fees, image lists, catalogs, and transportation charges taxable in Texas?
The reproduction license and COMPANY X's own-inventory research fee were nontaxable, but third-party image lists were taxable information and sold catalogs were taxable property.
Was natural gas used to heat chicken houses exempt from Texas sales tax, and could the operator obtain a refund for prior billing periods?
Potentially. Gas used to raise chickens for sale or produce eggs was exempt agricultural use, but other meter uses required a predominant-use study and the Comptroller requested more facts before deci…
Was labor to repair or remodel a tenant-only laundry room in an apartment complex subject to Texas sales tax?
No. A laundry room limited to tenants and guests was residential real property, so repair-and-remodeling labor was not taxable; the requester could pursue refunds for tax paid to contractors.
Were geophysical services using seismic-data processing taxable Texas data-processing services?
Not when professional geophysical interpretation was provided and data processing was only a tool. Pure data manipulation without analysis or professional evaluation was taxable data processing.
Is an unincorporated residential condominium association that rents out parking spaces and may lease units subject to Article 9-A franchise tax for every year since it was organized, including years before the 1989 law change?
Yes, for all years since organized. Bayside Mews Condominium, an unincorporated 142-unit residential association organized in 1982 under Real Property Law Article 9-B, derives its core revenue from co…
How did Texas tax auto-alarm installation and window tinting for vehicles, commercial buildings, residences, and new structures?
Auto alarms and commercial-building tinting were taxable. Vehicle tinting and residential or new-structure tinting depended on lump-sum versus separated billing, with labor not taxed in the described …
Were a nonlicensed company's real-time video transmissions for Texas television stations exempt as broadcasts by licensed stations?
No. The company sold taxable telecommunications services and had to collect tax because it was not itself a licensed or regulated commercial television station covered by the broadcast exemption.
When did a yearbook seller or school have to collect Texas sales tax on yearbooks bought for students?
Tax depended on who bought and resold the books. Exempt schools could buy qualifying books tax-free, but student payments and school resales generally were taxable except for the letter's limited one-…
How these rulings are useful
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