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 RR 95-18 treat current-year property taxes in a South Carolina delinquent-tax sale and redemption?
RR 95-18 required the forfeited land commission's minimum bid to include taxes levied for the year the redemption period began. A sale had to wait until those taxes could be computed. A redeemer…
Are charges for Internet access taxable in Utah as telephone/telecommunications service, back when Internet service providers first emerged?
No. In one of Utah's earliest rulings addressing the internet, an Internet service provider operating in Salt Lake City, Ogden, and Provo asked the Commission to clarify whether it had to charge…
How did sales tax apply when a partnership liquidated assets subject to liabilities and a trust then contributed its share to a new LLC?
The hypothetical partnership's ratable liquidation was taxable to the extent each partner assumed liabilities, unless an occasional-sale route independently applied. The gift trust's next transfer…
Could an auditor tax the gap between an automobile's agreed trade-in allowance and a higher guidebook value?
Not for a bona fide deal. The auditor had to rebut the agreed-value presumption with evidence that the dealer deliberately underallowed the vehicle to reduce tax.
Did the U.S.-Mexico treaty exempt the development bank's California purchases, sales, and tax-collection duties?
Yes. The treaty granted immunity from all taxation and tax-collection duties, so sales by or to the bank were exempt, although its California purchasers still owed use tax.
If a Texas business creates a website for a customer located in Mexico, does it still owe Texas sales tax on the charge?
Yes. The Comptroller confirmed that creating website software is taxable as tangible personal property, and that tax applies even when the customer is located in Mexico, because the software resides…
Is the Tarjeta Nacional De Inscripcion (a Mexican vehicle-registration document a customer gave a Texas seller) valid proof that goods were exported to Mexico for the Texas export exemption?
No. The Tarjeta Nacional De Inscripcion is not acceptable proof of export because it doesn't document that the specific goods sold were actually shipped into Mexico. Valid proof of export instead…
For a company that sells and rents equipment used on a tribal reservation inside Connecticut's borders, do those receipts count in the Connecticut receipts factor when it apportions its corporation business tax?
Yes — they count. A company that sells or rents construction equipment for use on a federally-recognized tribe's reservation that sits within Connecticut's borders must include those receipts in…
Is Utah sales tax owed on dog grooming charges, and how does that compare to veterinary services and animal boarding?
Yes, dog grooming charges are subject to Utah sales tax. Animals are tangible personal property (per a 1970 Attorney General opinion), and Utah Admin. Rule R865-19S-78 taxes charges for services…
Does a company that drafts customers' bank accounts electronically (EFT/ACH) on behalf of its business clients have to charge Texas sales tax on its drafting fees?
No. The Comptroller told the taxpayer that the fee it charges for its bank drafting service is not a taxable service, so it should not collect sales tax on those fees from its customers. However,…
New York Advisory Opinion TSB-A-95(42)S: In CS First Boston's proposed NYC IDA headquarters-retention deal -- where the building owner, Metlife, pays for and owns most leasehold improvements for regulatory-capital reasons while the IDA holds legal title -- are the purchases of Eligible Personalty, the Improvements, Metlife's reimbursements, and CS First Boston's debt-service payments exempt from sales and use tax?
Exempt, but with a genuinely fact-dependent condition on the Improvements question that this opinion couldn't resolve outright. CS First Boston Corporation ("CS First Boston") proposed a roughly…
Under Florida's 1995 intangible tax, what happened when affiliated companies sold receivables to an out-of-state subsidiary before January 1?
The receivables were not subject to Florida intangible tax when the out-of-state subsidiary owned, managed, and controlled them on January 1 and did no Florida business. Later transfer back did not…
What eligibility, job-credit, and withholding-fee rules did South Carolina apply under the 1995 Enterprise Zone Act?
A qualifying project generally needed Council approval and an agreement before eligible costs, at least 10 new full-time jobs for the enterprise-zone job credit, and the required employee mix. The…
What position did South Carolina adopt on multi-county industrial parks and special source revenue bonds in 1995?
The Department announced that it would follow the conclusions in South Carolina Attorney General Opinion 93-81. The current official one-page PDF says the opinion is attached but does not include…
Can a towing company or mechanic access a vehicle's protected registration record based on their possessory lien, and does a protected registration stay protected after the vehicle is sold?
No, not directly. A towing company's or mechanic's possessory lien (created by statute) does not qualify as a 'bona fide security interest' under Utah Code Ann. § 41-1a-116(4), because that term…
Is a drilling contractor's charge for oil/gas well drilling services a taxable equipment rental or a tax-exempt service, and does it matter who physically operates the equipment?
It's an exempt service contract if the drilling contractor -- the one who supplies the equipment -- also retains CONTROL and supervision over the drilling operation, even if the customer's own…
In a sale-leaseback of manufacturing equipment, is the sale to the leasing company exempt, and are the lease payments back exempt?
The initial sale is exempt, but the lease payments are not. The manufacturer's sale of its own equipment to a leasing company is exempt as a purchase for resale. But because the leaseback was…
For deciding whether more than 95 percent of an insurance company's 'premiums' under section 1505(b) are for annuity contracts, do 'premiums' include reinsurance premiums (including from licensed or affiliated insurers) and all direct premiums on both New York and out-of-state risks?
Yes. For the section 1505(b) test of whether more than 95 percent of an insurer's premiums are for annuity contracts, 'premiums' means premiums as in the first sentence of section 1510(c)(1)…
Our state agency's subsidiary is redeveloping a 94-acre Queens waterfront site. A private developer will build the first residential parcel, financed by outside lenders, with our subsidiary named as the initial mortgagee even though it has no beneficial interest in the loan. Is recording that mortgage -- and its later assignment to the real lender -- exempt from mortgage recording tax?
Exempt, while UDC or its subsidiary QWDC remains the named mortgagee. This is the origin advisory opinion for the Hunters Point (Queens West) Waterfront Development project -- a 94-acre East River…
How did Florida tax a multistate refinancing involving assigned mortgages, an out-of-state $125 million note, a $100 Florida recovery cap, and consolidated renewal documents?
Most steps were exempt. The note-and-mortgage assignment, out-of-state notes, consolidation agreement, and consolidated renewal mortgage produced no additional tax. The recorded second mortgage owed…
How did California tax fabrication labor split between work and customer delivery inside California and work and delivery outside the state?
California taxed the fabrication charges tied to California work and California delivery, but not the out-of-state work delivered outside California. Payment location did not matter.
Was adding a second inscription to an existing cemetery marker taxable?
Engraving an existing granite marker was nontaxable, even if temporarily removed, but selling a new bronze inscription plate was taxable tangible property.
Did furnishing self-manufactured replacement parts make rents taxable when the lessor had paid tax on the machinery at purchase?
No. The machinery remained leased in substantially the same form, so rents stayed nontaxable; the lessor instead owed tax on materials used in the replacement parts.
How did California tax outdoor advertising that combined programmed lights, projected stills or motion, printed billboard sheets, and leased equipment?
Treatment varied by component: finished art, slides, printing, and release prints were taxable; qualifying custom software and motion-picture production services were not.
Who owed Texas minimum rental tax after fleet refinancing, and could one entity use another entity's retired vehicles as deductions?
Refinancing the existing fleet did not itself trigger minimum rental tax. But for newly titled vehicles, only the title owner could use retired vehicles titled to that same entity as deductions, and…
Does a clean room used to make the protective garments worn in semiconductor fabrication qualify for Texas's semiconductor fabrication clean room sales tax exemption?
No. The Comptroller held that the 'semiconductor fabrication clean room' exemption (created by Senate Bill 640) only covers clean rooms used to manufacture an actual semiconductor product — a clean…
Did the Amigo Deluxe and Hoveround three-wheel mobility devices qualify as wheelchairs?
Yes. California treated the two models as motorized wheelchairs, making an individual user's purchase exempt when for personal use as directed by a licensed physician.
Did a two-day California software-training seminar create use-tax collection responsibility for an out-of-state developer?
Yes under the historical rule applied. Training in California as part of the software sale was definite sales-related physical presence; California trade-show activity could independently support…
Did storing and ministerially servicing Georgia loan notes in Florida create annual intangible tax or documentary stamp tax?
No. Notes owned, managed, and controlled in Georgia were not subject to annual intangible tax merely because a Florida affiliate stored them and performed limited servicing. Their later presence in…
Did a Florida grantor owe intangible tax on an irrevocable trust when he could withdraw corpus only during a stated eight-month period each year?
Yes. The Department treated the grantor's right to withdraw any or all trust corpus from March 1 through October 31 as a continuing power of revocation, even when it could not be exercised during…
Which of eight LoanLiner open-end credit forms was subject to Florida documentary stamp tax?
Only the LoanLiner Subsequent Action Form was taxable when its Extension Agreement was exercised, with tax based on the unpaid balance entered on the form. The other seven forms did not contain or…
Did Florida documentary stamp tax apply when an out-of-state statutory merger transferred Florida real property to the surviving nonprofit by operation of law without a deed?
No. Florida documentary stamp tax did not apply when the real property passed to the surviving corporation by operation of merger statutes and no deed was given. If a deed were given, consideration…
Could a corporation carry later-year losses back to offset final prior-year Utah deficiencies, and did it have to pay the deficiencies before the loss years were audited?
Utah said the corporation could carry later-year losses back to offset income and deficiencies in earlier years. But the Commission would apply the carrybacks through an upcoming audit of the loss…
Was a purchased barge taxable as a vessel even though the buyers later attached it to real property with piling rings and pilings?
Yes. The barge was designed for navigation and had been towed, so it was a vessel when purchased. Its later attachment to real property did not change the tax.
Who had to report California tax when an out-of-state lumber reseller used California suppliers, treaters, storage, or delivery agents?
The facts were insufficient for one answer. The reseller had to collect use tax if California storage or agents made it engaged in business; otherwise an in-state deliverer could be reclassified as…
If my business charges landfill, garbage, or pallet companies a fee just to accept pallets and scrap materials at my facility (which I then use as raw material), do I owe sales tax on that fee?
No. The Comptroller ruled that a fee charged simply to accept pallets and related materials delivered by landfill, garbage, and pallet companies — without collecting the waste from the customer — is…
Will Texas accept the Multistate Tax Commission's Uniform Sales & Use Tax Multi-Jurisdiction Certificate as a valid Texas resale certificate?
Not as submitted. The Comptroller's office reviewed a proposed Multi-Jurisdiction Sales & Use Tax Exemption Certificate and identified four problems that would need to be fixed before Texas could…
Does a law firm that performs background investigations for its clients have to charge sales tax like a licensed private investigator would?
No, not merely by doing background investigations for clients. Legal services are not on the list of taxable services, so attorneys don't collect sales tax on their legal fees — they're instead…
Is a New York investment-advisory subsidiary of a foreign 'bank' that is principally engaged in investment management (not deposits/lending) taxable under Article 32 as a banking corporation, or under Article 9-A?
Article 9-A. A corporation is a banking corporation under section 1452(a)(9) only if its foreign parent is itself a banking corporation -- and a corporation is 'doing a banking business' only if it…
Did Navy vessel-repair DFARS clauses transfer title to overhead materials before the contractor used them?
No. The clauses covered materials intended for incorporation into a vessel, not overhead items, and reimbursement alone did not transfer title.
Could a retailer deduct a city charge equal to 3% of gross sales when computing California sales tax?
No. The lease-required city charge was a cost of doing business included in taxable gross receipts, not a qualifying local sales or use tax excluded by statute.
If a company hires contractors to clean up PCB contamination at its facility, does it owe sales tax on the site inspection, soil removal, decontamination cleaning, and waste-hauling charges?
It depends on the specific service. Site inspection and removal/replacement of contaminated soil are nontaxable services. Decontamination cleaning of the real property itself (like the compressor…
Are water trucks used to control lime dust at a limestone processing facility, as mandated by the State of Texas, exempt from tax because they're used for pollution control?
No exemption. The Comptroller ruled that if the water trucks are designed to transport persons or property on the highway, they are motor vehicles subject to motor vehicle tax (not sales tax), so…
When could a construction contractor avoid South Carolina's 1% local option tax on building materials under the 1995 guidance?
A pre-imposition contract or qualifying earlier written bid could support an exemption if a verified contract copy was mailed within six months and the Department issued a contract-specific…
Does a manufacturer owe sales tax when it sells hydrogen embrittlement test bars to plating companies, who use the bars to certify the quality of their plating tanks?
No exemption. The Comptroller ruled that hydrogen embrittlement test bars sold to plating companies for use in certifying the quality of their plating tanks do not qualify for the Rule 3.300…
If my litigation support business produces trial exhibits like scale models, graphs, photographs, or videotapes for an attorney, do I have to charge Texas sales tax?
Yes, for the exhibits. The Comptroller ruled that separately stated consulting services are not taxable, but producing exhibits such as scale models, graphs, photographs, videotapes, maps, and…
Could a bioengineering contractor buy direct and overhead property for resale to the United States under its demonstration-project title clause?
Yes. The FAR-like clause passed direct and indirect property to the government before use, provided the contractor timely issued valid resale certificates.
Could California assess officers for business conducted after a corporation was suspended and then entered Chapter 11?
Yes. Because the Franchise Tax Board suspension occurred before bankruptcy, staff said continuing it did not violate the stay and officers could face dual determinations for later operations.
How much rent could California levy from jointly owned property after one spouse's tax liability was discharged in bankruptcy?
Only one-half. Staff treated each spouse's joint-tenancy share and its rents as separate property, so the levy could reach only the liable spouse's half.
Is a pre-employment background screening service (criminal, education, driving, and credit checks) taxable in Texas?
Yes. The Comptroller ruled that a company using on-line databases to run pre-employment screenings — pulling credit reports, criminal and civil records, education verification, and driver's license…
Is equipment used in mining or quarrying (like screening equipment, shaker screens, front end loaders, sand screws, and gravel water pumps) exempt from Texas sales tax under the manufacturing exemption?
It depends on when the equipment is used relative to when processing (crushing/grinding) begins. Screening equipment, shaker screens, and sand screws are taxable if used before crushing or grinding…
Was a fee paid directly to a licensed vehicle lease facilitator subject to Texas motor vehicle sales tax?
No, under the described structure. The dealer sold the vehicle directly to the banking-institution lessor, and the facilitator acted only as the lessor's agent. Tax applied to the total…
Do refrigerated sandwich/pizza prep units and refrigerated worktop/undercounter units used in a restaurant qualify for Texas's manufacturing machinery and equipment sales tax exemption?
No. The Comptroller ruled that refrigerated sandwich/pizza preparation units and refrigerated worktop/undercounter units do not qualify as exempt manufacturing machinery and equipment. These units…
Were personalized letters from Santa taxable, and how did California treat related calls, nonprofit fundraisers, and sponsored children's books?
The personalized form letter was taxable on the full charge; a separately sold telephone call was not, while bundling, nonprofit agency status, and sponsored-book sales changed the taxable measure.
Who owed California tax when an out-of-state retailer shipped a firearm to a California dealer for registration and delivery to the buyer?
The California dealer was presumed to be the retailer if the out-of-state seller was not registered or shown to be engaged in California; otherwise the out-of-state seller collected use tax.
Were sponsor payments taxable when a company produced personalized books that local businesses funded and children received for free?
Yes, under the assumed arrangement. California treated the local businesses as buying the finished books, so the producer owed sales tax on the sponsors' payments.
How did California tax equipment bought with Texas tax, sold to a leasing company, leased back, and then used in California?
If the arrangement was a true sale and leaseback, California taxed the rents at the equipment's location and gave no credit for Texas tax paid on the earlier purchase.
Can an outside accountant who prepares a client's sales tax reports for a fee be held personally liable for the client's unpaid sales tax under Texas's responsible-person rule?
No. The Comptroller's office explained that personal liability under Section 111.016 of the Texas Tax Code for "control or supervision" of the accounting, collection, or payment of tax generally…
Did a lessee's residual-value obligation or purchase option turn the vehicle leases into conditional sales?
No. Requiring the lessee to act as sales agent or cover a minimum resale amount was not the same as requiring the lessee to buy the vehicle. One lease also gave an option to purchase, but the letter…
Does an indoor golf-simulator business have to charge Utah sales tax on time or per-round charges to use the machines?
Yes. Charges for using golf simulation equipment — whether billed by the quarter-hour or by the round — are taxable as admission/user fees for a recreation or amusement activity. The billing method…
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