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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Are fees that bowling leagues pay for use of bowling lanes subject to Utah sales tax, or are they exempt like country club membership dues or facility rental?
Yes, fees bowling leagues pay for the use of bowling lanes remain subject to Utah sales tax as taxable admission or user fees — whether paid by an individual bowler or collected by a league on…
Were five-year, usage-based contracts for on-site access to a title plant taxable services, leases, or sales?
On-site access was taxable rent; a tangible copy option was taxable, but remote delivery with no storage media or paper was not.
Is electricity used at a restaurant chain's central commissary/kitchen exempt from sales tax if the food leaving the commissary isn't yet ready to eat?
No. The Comptroller ruled that the electricity used at the commissary is taxable. Even though the commissary only partially prepares the food before sending it to the restaurants to finish, the…
What South Carolina tax interest rate applied for the period beginning January 1, 1996?
The rate was 9%. The notice says interest was compounded daily, except that simple interest applied to an underpayment of a declaration of estimated tax.
Did paying use tax to a yacht broker satisfy the buyer's tax duty when the broker was not the vessel's retailer?
Not under the law applied to this older sale: the buyer still had to report use tax directly, while the broker owed the amount collected to the state. A 1996 amendment later added buyer relief with…
Did paying an amount labeled use tax to a yacht broker satisfy a purchaser's use-tax liability when the broker was not the vessel's retailer?
Not under the law governing that purchase. The buyer still owed use tax directly, while the broker owed the state any amount collected as tax. Amendments effective in 1996 later provided purchaser…
Could a retailer or third-party card company deduct customer accounts that the card company wrote off?
Neither could. The retailer did not take the income-tax writeoff, and the card company was neither the retailer nor a qualifying successor.
Do I have to charge Texas sales tax when I sell to an out-of-state government agency, college, university, or school district?
Generally yes for out-of-state government agencies — Texas doesn't exempt other states' governmental agencies unless a border state (like Louisiana or Oklahoma) has a reciprocal exemption agreement…
If I have a contract to improve realty for a tax-exempt entity (like a city), can I buy telecommunications/telephone services for the job site tax-free?
Not automatically. The Comptroller said telecommunications services aren't considered integral to improving realty, but a contractor can still give an exemption certificate for telecom services used…
Does a trade show exhibit contractor have to charge sales tax on storage, transportation, installation, design/construction, supplies, and refurbishing services for client-owned exhibits and displays?
It depends on the service. Storage, transportation, handling/removal charges, and installation (electrical drop) charges for client-owned exhibits are not taxable unless tied to a sale or lease of…
Is a contractor's charge for repairing or remodeling a warehouse for a movie production company exempt under Texas's manufacturing exemption?
No. The Comptroller advised that the repair or remodeling of the warehouse is a taxable nonresidential repair and remodeling service. Even though the movie production company that rented the…
Is Connecticut sales or use tax owed on construction equipment and materials sold or rented for use on a Connecticut tribe's reservation — when sold to the tribe itself, and when sold to the non-Indian contractors building for the tribe?
It depends on WHO buys and WHERE title or delivery passes. Sales and rentals of construction equipment made DIRECTLY to the Connecticut tribe or its enrolled members are exempt (federal preemption,…
Was an intermediate passive holding company included in California's combined report when it connected a unitary operating parent with unitary operating subsidiaries?
Yes. When the passive holding company devoted all or virtually all of its activity to holding subsidiaries that were unitary with its operating parent, FTB treated it as an integral conduit in the…
Was a passive parent holding company unitary with operating subsidiaries that conducted one unitary business?
Yes. A passive parent that devoted all or virtually all of its activity to one unitary operating subsidiary or group was part of that unitary business and included in the combined report. But a…
Would rent be taxable if a United Kingdom company moved German-leased equipment to California and subleased it to an affiliate?
Yes under assumptions. With no California acquisition or prime-rent tax, affiliate owed tax on sublease rent and UK sublessor collected/remitted.
Is a consultant who uses handwriting analysis, body language, statement analysis, and human behavior analysis to evaluate individuals for jury profiling or employment screening providing a taxable service in Texas?
No, generally not. The Comptroller's office told this consultant that using a computer to prepare analysis reports for clients doesn't make the work taxable "data processing services," and the…
If a manufacturer's plant and equipment are destroyed by fire and it rebuilds on the same site, does the new replacement manufacturing equipment qualify for Utah's sales tax exemption for new or expanded operations?
No. The Tax Commission ruled that manufacturing equipment purchased to replace equipment destroyed by fire does NOT qualify for the new-or-expanded-operations sales tax exemption -- it's a normal…
Was a lessor-paid lease-facilitator fee taxable when the facilitator was neither the vehicle seller nor the seller's agent?
No. The fee was not part of taxable consideration because the purchaser paid it to a facilitator that was neither the seller nor the seller's agent. The result applied whether the worksheet folded…
Could a lessee-owned vehicle reduce the taxable value of a lessor's vehicle purchase without the dealer physically possessing the trade-in?
Yes, physical possession by the dealer was not required if the trade-in otherwise formed part of the lessor's purchase consideration and the seller's records showed acceptance, credit, and resale to…
Are charges for assembling or erecting an above-ground swimming pool taxable in Texas, and does it matter whether a third-party installer does the work?
It depends on what the work actually is. Charges for a true third-party 'installation' — placing tangible personal property in position without changing its form — are not taxable (though separately…
When a contractor makes an improvement that increases production capacity at a Texas refinery or chemical plant, does sales tax apply to the material, the labor, or both?
It depends on how the contract is written. Under the law effective October 1, 1995, labor to improve production capacity at a refinery or chemical plant is a non-taxable improvement to realty either…
Is cleaning/washing a trailer tank after hauling liquid chemicals a taxable service in Texas, and can the cleaning chemicals and required safety gear be bought tax free?
No, the cleaning itself isn't taxable — the Comptroller said washing out a trailer tank between loads is nontaxable maintenance to a motor vehicle. But the client still can't buy the cleaning…
Is electricity used in a corporate apartment that a company leases to house out-of-town clients and associates (at no charge, for stays typically under a week) subject to Texas sales tax?
Yes, it's taxable. The Comptroller ruled that electricity used in a corporate apartment maintained to house visiting clients and associates is 'commercial use' under Texas Tax Code § 151.317(a), not…
When a business reorganizes — transferring assets to a new subsidiary, contributing assets between related corporations, or trading stock between commonly-owned subsidiaries — which of those transfers are subject to Texas sales tax, and how are stock-sale receipts allocated for franchise tax?
It depends on the transaction. A transfer of substantially all the assets of an identifiable business segment can still qualify for the occasional sale exemption even if a shared-use asset (like a…
Does an apartment complex have to perform its own predominant use study before claiming a sales tax exemption on electricity from a master meter that serves only common-area/residential uses?
Not necessarily. The Comptroller's Tax Policy Division told this association that apartment complexes whose master meters serve only onsite management offices and residential common areas (club…
The Department says I never paid, but I'm sure I mailed my return and a check — can I win with just my word?
No — uncorroborated testimony that you paid isn't enough to beat an assessment. Peter Grivas, a New Mexico resident, was assessed $2,158.27 in personal income tax plus interest and penalty for 1991…
Do fashion stylists owe Texas sales tax on rentals and services they provide for still-photography shoots versus for motion picture, video, or audio production?
It depends on the type of production. For still photography, taxability has not changed from a 1990 response and generally still applies. But beginning October 1, 1993, producing a motion picture,…
Did Florida part-time employees who demonstrated products owned by military exchanges and answered technical questions create corporate-income-tax nexus?
Yes. Although the distributor's ordinary solicitation activities were protected, its Florida military-sales employees demonstrated products already owned by the exchanges and answered technical…
When is having tires retreaded (or an alternator, generator, radiator, or transmission repaired) treated as taxable 'repair' of tangible personal property, rather than an exempt repair of a motor vehicle component, under Texas sales tax rules?
If you have more casings retreaded than the number of tires the vehicle is designed to use, the Comptroller presumes you are having taxable tangible personal property repaired, not an exempt motor…
Is having tires retreaded, or having alternators, generators, radiators, or transmissions worked on, taxed as a repair of your motor vehicle in Texas?
Usually yes, taxable as repair — but it can be rebutted. The Comptroller's office says that if you have casings retreaded in a number exceeding the tires a vehicle is designed to use, the…
Does a customer owe Texas sales tax on tire retreading (or similarly, on repair of alternators, generators, radiators, and transmissions) when the repaired part goes back on the same vehicle versus into inventory?
It depends on what happens to the part. If a customer's tire casings (or similar motor vehicle components like alternators, generators, radiators, or transmissions) are repaired and go right back…
How did South Carolina reorganize its income-tax, withholding, and corporate-license-fee chapters for tax years after 1995?
For taxable years beginning after 1995, Chapters 7, 9, and 19 were rewritten, repealed, and replaced by Chapters 6, 8, and 20, respectively. The notice provides eight exhibits mapping old and new…
Is a satellite trucking dispatch messaging service, and the equipment that goes with it, subject to Utah sales tax?
The messaging/dispatch service itself is not subject to Utah sales and use tax. But the sale or lease of the equipment installed in the trucks and dispatch centers to use that service IS subject to…
Did California need a nominee lien after a taxpayer quitclaimed already-liened property for no consideration?
No. The existing state tax lien attached before the quitclaim and followed the property, so the transferee took it subject to that lien.
Could California levy assigned receivables, including sales-tax reimbursement, when a lender perfected its security interest before the state tax lien was filed?
No, unless California could prove an earlier lien filing. Staff said the prior perfected security interest was senior and covered the assigned receivables, including sales-tax reimbursement.
Can a company that overhauls and repairs jet turbine engines buy consumables like cleaning solvents and plasma tax-free, and does the machinery/equipment exemption apply even if some customers aren't certificated airlines?
Yes to both. The Comptroller told this engine-overhaul company that consumables such as cleaning solvents and plasma that are used up or transferred to the customer during overhauling, retrofitting,…
Is toner sold to a commercial printing or copy company exempt from Utah sales tax as a component part of the copies they resell, and is the labor to refill a toner cartridge taxable?
Toner can be exempt, but only conditionally -- it depends entirely on who's buying it and why. If you sell toner to a commercial printer or copy service that uses it to produce copies or printed…
How did South Carolina calculate rollback millage after a property reassessment under the 1995 law?
Divide the prior year's property-tax collections by the new reassessment tax base, including fee-in-lieu property in both amounts as described by the notice. Each taxing entity required its own…
Did a hot Cornish pasty qualify for California's single-item bakery exclusion?
No. The Board viewed a Cornish pasty as a meal wrapped in pastry, not a bakery good, so a hot pasty was taxable prepared food.
Were hot fruit-, cream-, or meat-and-cheese-filled croissants taxable when sold for one separate price?
Fruit- or cream-filled croissants qualified as bakery goods and could receive the single-item hot-bakery exclusion, but hot meat-and-cheese croissants were taxable prepared food.
Does a retailer have to collect sales tax on the service charge (bad-check fee) paid by the writer of a dishonored check?
It depends on who collects the fee. If the retailer itself collects the processing fee directly from the person who wrote the bad check, no tax is due on that fee. But if the retailer hires a debt…
Can a New York resident estate that owns 100% of an out-of-state S corporation claim New York's resident tax credit for the income tax it pays to that other state on the S corporation's pass-through gain?
Potentially, yes. Tax Law § 620(a) and (d) let a resident estate claim New York's resident credit for tax it pays to another state on an S corporation's income, computed as if the estate were an…
New York Advisory Opinion TSB-A-95(44)S: Does a boat-slip condominium association's common charges become subject to the sales tax on social/athletic club dues because the condominium includes tennis courts and a swimming pool, and must the association form a separate corporation to run those facilities?
Partly taxable -- only the portion of common charges reasonably allocable to the tennis and pool facilities counts as club dues, and no separate corporation is required. Anchorage Yacht Club…
When an out-of-state seller ships tangible personal property to a New York customer by common carrier, when are the receipts allocated to New York for the Article 9-A receipts factor across eight shipping/risk/payment scenarios?
It depends on the seller's connection to the shipment. Receipts from sales of tangible personal property are allocated to New York where the goods are shipped to points in New York. In Scenario 1 --…
Does Utah's Income Tax Act grant every taxpayer who misses the filing deadline an automatic extension, or does an extension require prepaying most of the tax due first?
No, a Utah income tax filing extension is not automatic just because a taxpayer misses the deadline -- it requires a prepayment. A taxpayer argued that Utah's Income Tax Act grants every late-filing…
How was sales tax measured on a bread-baking kit containing exempt bread mix and a reusable clay pot worth more than 10 percent of the package's retail value?
The seller had to segregate the clay pot and charge tax on its retail selling price because the nonfood pot was expected to exceed 10 percent of package value.
Do a foreign commodity trader's New York activities -- soliciting orders plus maintaining coffee-bean inventory in a New York public warehouse for sale to customers -- subject it to Article 9-A tax, or are they protected as minimal property/Public Law 86-272?
Yes, it is taxable. International Coffee solicits orders in New York and, when it takes delivery on coffee-bean futures, holds the physical beans in a New York public warehouse for sale to its…
Could a nonprofit religious television organization sell tangible personal property without collecting Florida sales tax when it also held regular public worship services?
Yes. The nonprofit already qualified as a religious institution through its religious television station, and its regularly scheduled public worship services at the station also satisfied the rule's…
How did RP 95-7 guide penalties for South Carolina beer, wine, minibottle, liquor, and wholesale-license violations?
It generally escalated sanctions from monetary penalties to suspension and revocation based on violations at the licensed location during the preceding three years. Serious offenses could trigger…
What counted as school operations under South Carolina's 1995 property-tax relief exemption?
School operations excluded bonded indebtedness and lease-purchase payments for capital construction. The exemption did cover K-12 school-district operating millage, including lease-purchase payments…
Did feed for a food-animal species remain exempt when the particular animal was kept as a pet rather than used for food?
Yes. Feed for a species ordinarily producing human food was exempt regardless of actual use, so rabbit pellets for a pet rabbit were exempt. Certificate rules still applied to mixed-use feed.
Did a late South Carolina withholding-tax deposit trigger interest before the quarterly return due date under RR 95-17?
Not by itself. RR 95-17 said interest began only when withholding tax remained unpaid after the quarterly return due date. The Department could still impose a discretionary $10-to-$1,000 penalty for…
Is a soil/groundwater remediation system (like an Air Sparge/Soil Vapor Extraction System) required by the Texas Natural Resource Conservation Commission exempt from Texas sales and use tax as pollution-control equipment?
No. The Comptroller ruled there is no sales tax exemption for the construction and installation of a Remediation System used to clean up contaminated soil and groundwater around an underground…
If a company pulls the rods, tubing, and other downhole equipment from a well to prepare it for plugging, but a different company plugs the well on a later day, is the equipment-pulling service taxable?
No. The Comptroller ruled that Rule 3.324 does not tax labor or services directly related to plugging and abandoning a well, and pulling the downhole equipment beforehand counts as directly related…
Did a Florida bank trustee have to file an intangible-tax return for an irrevocable trust even though the grantor retained the residue and the trust paid no federal income tax?
Yes. The Florida-domiciled bank held legal title to the assets, making the trust a Florida-situs trust and requiring the trustee to file for its taxable intangible property. The grantor's…
Under Florida's 1996 intangible tax, were consumer-loan receivables sold before January 1 to a non-Florida affiliate taxable, and did local servicing or later repurchase change the result?
No. Receivables owned on January 1 by an affiliate with no Florida domicile or business situs were not taxable. The sellers' listed servicing duties were ministerial, repurchase after January 1 did…
Were a church cafeteria's vegetarian lunches sold to congregation members taxable?
No, on the stated assumptions. Lunches sold at church gatherings to raise money used for church functions were exempt, but regular cafeteria sales to the public were not.
When was use tax due for an aircraft or documented vessel if the buyer had no permit or use-tax account and the Board had not mailed a return?
On the last day of the twelfth month after the purchase month. A June 19, 1987 aircraft purchase was due June 30, 1988, unless a mailed return created an earlier date.
Is a cancellation fee charged when a customer ends a service agreement early subject to Texas sales tax?
It depends on the underlying service. If the service being cancelled is a taxable service, the cancellation fee is part of the taxable 'sales price' of that service under Tex. Tax Code §…
Can a Texas home builder or developer buy landscaping, lawn care, pest control, surveying, building and grounds cleaning, or waste removal services tax-free during construction of a new home, and does that exclusion cover model homes?
Mostly yes for new construction, but no for model homes. Under changes to Tax Code Section 151.0048 effective October 1, 1995, home builders and developers can buy landscaping, lawn care, pest…
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