State Tax Rulings
Free state tax letter rulings and advisory opinions with plain-English summaries, full citations, and the original source on every page.
No rulings match these filters
Try fewer or different words, check the spelling, or clear the filters to browse everything.
I made an honest mistake on my return that the Department could have caught but didn't for years — do I still owe interest on the tax I underpaid?
Yes. Interest is owed on any underpayment of tax, even an honest error the Department could have caught from the face of your return but didn't. Emiel Bosman, a New Mexico resident who worked as a…
Can a business report sales tax on a modified accounting basis that lets it collect tax from customers but delay remitting that tax to the Comptroller past the statutory due date?
No. The Comptroller denied a company's proposed modified-accrual reporting method (treating invoices dated in one month as the following month's return data) because it would let the company collect…
Does it matter, for Texas sales tax purposes, whether an insurance agency's risk-management fee is paid out of commissions on premiums or billed directly to the client?
No. The Comptroller ruled that whether a fee is paid from commissions on premiums or billed directly to the client does not change the sales tax result. What matters is whether the specific activity…
New York Advisory Opinion TSB-A-95(33)S: Is a company's charge for creating and running Internet advertisements -- "Virtual Storefronts" displaying a client's products -- subject to New York sales tax?
Not taxable, as long as Petitioner isn't also selling tangible personal property. Mike Levy's company, Cyberactive, sets up "Virtual Storefronts" for client companies on the Internet, creating and…
How did PLR 95-9 apportion trademark royalties earned by a South Carolina licensing subsidiary?
The addressed subsidiary used the historical gross-receipts formula. Its numerator included royalties from the licensee's sales delivered to customers in South Carolina, and its denominator included…
Were ABC's purchases of parts and materials for temporary dual-vacuum extraction systems exempt when the systems cleaned soil and groundwater pollution caused by manufacturing machines?
Yes, for ABC's stated facts and only if every requirement of Regulation 117-173 was met. The systems removed water, vapor, and contaminants caused by machines manufacturing tangible personal…
When a company sells blueprints made from customer-supplied drawings, does it owe sales tax on the sale, even if the blueprints end up being used to build a real estate improvement for a tax-exempt entity?
Yes, in most cases. The Comptroller told the seller (Company X) that it must charge sales tax when it sells blueprints to an architectural/engineering firm or to a general contractor, regardless of…
Is telephone or on-site technical support for software taxable in Texas, and can a contractor providing that support staff to a company accept a resale certificate instead of charging tax?
Yes, charges for telephone technical support of tangible personal property (including software) are subject to Texas sales and use tax if provided to a recipient in Texas, though the service can be…
Is a caregiver referral agency's fee taxable, and are the pre-employment screening services it performs (criminal history, driving records, reference checks) subject to Texas sales tax?
The referral fee itself is not taxable. But the pre-employment screening components — criminal conviction histories, driving records, and reference confirmations — may be taxable if the customer…
What did the original Florida TAA 95A-040 say about a religious broadcaster's merchandise sales, and why must revised TAA 95A-040R control?
The original ruling required sales tax because the organization was shown to be a religious institution but not a church, and its own corporate purposes focused on broadcasting. The source directs…
Which shopping-mall operating-cost pass-throughs and parking charges were taxable as Florida rent or parking, and how did the mall have to state tax?
Actual separately billed electricity cost was not taxable rent when the landlord had already paid sales tax, but any markup or admin fee was taxable. Other mandatory operating-cost pass-throughs…
Does Connecticut sales tax apply when a store sells a prepaid long-distance phone card, and does it apply when a customer later uses the card to make calls?
Two separate answers. Selling the prepaid long-distance phone card is NOT taxable — a phone card is a 'cash equivalent' (like a gift certificate or voucher), so its sale is the sale of an intangible…
Were packaged malt, hops, sugar, yeast, gelatin, and Irish moss exempt food ingredients even though customers would use them to make taxable beer?
Yes, if the yeast and Irish moss were sold as edible ingredients rather than supplements or for nonedible uses. Tax could still apply to significant nonfood kit items.
Can Booster Clubs buy tax-free as exempt organizations or hold tax-free sale days, can a school issue an exemption certificate for cheerleader uniforms bought through the school, and can a teacher buy classroom supplies tax-free if reimbursed later?
This is an internal Comptroller staff memo (Bettie Peterson to Ron Watkins), titled 'Taxability School Related Organizations,' answering three questions: (1) a Booster Club can only make tax-free…
Did a vessel charter remain a taxable bareboat lease when the charterer chose the voyage but the separately hired captain controlled navigation and safety?
Yes. The charterer received possession and control over the vessel's destination, while the captain's navigation and safety authority was only a limitation on use. A vessel bought exclusively for…
Did the Texas Comptroller waive the electronic fund transfer (EFT) filing requirements under Sec. 151.401 of the Sales Tax Law for affected taxpayers?
Yes. In this August 9, 1995 letter, the Comptroller confirmed that it had waived the requirements stipulated in Section 151.401(a)(1) and (2) of the Sales Tax Law for all affected taxpayers. The…
New York Advisory Opinion TSB-A-95(32)S: Are a horse spa's fees for pool use, a walk-around exercise service, horse transportation, and boarding subject to sales tax, and does it matter whether the horse owner or the facility's licensed trainer handles the horse?
It depends on who handles the horse: pool rental alone is untaxed as real property rental, but the exercise, transport, and boarding fees are exempt only when performed by a licensed trainer…
When a customer trades in their old vehicle as part of leasing a new one, does the trade-in reduce the amount subject to New York sales tax -- even when the lease is actually financed and owned by a separate leasing company rather than the dealer?
It depends on whether the dealer taking the trade-in has actually been appointed as the leasing company's agent for accepting trade-ins (not merely for paperwork). If the dealer only has authority…
Was a Florida sale exempt when the customer picked up the goods in Florida but held an export sales-tax number and supplied a blanket resale certificate?
Yes. The Department treated the customer as a licensed exporter because it held a valid Florida export sales-tax number, and the customer supplied a blanket resale certificate claiming the sale for export.
Were installed volleyball and badminton systems wholly construction materials or fixtures?
No. Floor-set pole sleeves were materials, but readily removable poles, nets, and other components were neither materials nor fixtures; the installer sold those items at retail.
How did California classify the separate components of installed indoor and outdoor basketball equipment?
Embedded outdoor poles and indoor rails, hanging supports, and back bars were materials; completed backboards, hoops, motors, and lifting belts were fixtures.
Does Texas local sales and use tax apply to conference calling charges when the conference call center or 800 number is located outside Texas but some participants call in from Texas?
It depends on where each leg of the call originates, not on where the conference call center is located. For a 'Dial Out' call, the client owes state (but not local) sales tax on its own call to the…
What was Florida's intangible-tax treatment when a Florida corporation transferred its trust interest before January 1 to a Delaware subsidiary and received an intercompany note?
The Florida seller was not taxed on a trust interest it no longer owned on January 1, and the Delaware buyer was not taxed because the trust and buyer lacked Florida taxable situs. The buyer's note…
How did an insurer apply Florida's intangible-tax exemption when its annuity reserves were bookkeeping entries rather than designated assets?
The insurer could reduce the taxable value of its intangible property generally by the amount of assets held as its Florida statutory annuity reserve. It did not have to identify particular reserve…
Are charges to install and adapt canned computer software to a company's needs exempt from Utah sales tax if separately stated on the invoice?
Not automatically. Rule R865-19S-92 D exempts separately-stated charges to modify or adapt prewritten ('canned') software, but the Commission held that the adaptation must actually CHANGE THE…
Are a product warranty, a separately-sold travel-expense contract, and an extended service contract each taxable when sold with a scientific instrument, and do repair parts later brought into Utah trigger use tax?
All three are taxable at the time of sale -- the built-in one-year warranty (bundled into the instrument's price), the separately-billed Travel Extension Agreement covering post-90-day travel…
How did California tax replacement of a defective boat when the motor-vehicle Lemon Law did not apply?
A mandatory-warranty replacement was treated as resale with no tax on the replacement transfer; an optional-warranty provider consumed the boat, and any customer upgrade payment was taxable.
Did hiring a California collection agency to persuade customers to pay debts make an out-of-state mail-order seller collect use tax?
No, on the stated 1995 facts. Debt collection was not selling, delivering, installing, assembling, or taking orders for tangible property.
Did heavily customized software for computerized telephone switching systems qualify as nontaxable custom software?
Yes on the stated assumptions: it was not a basic operational program and customization exceeded half the software contract price. Audit facts could change the result.
For a Texas advertising agency, are charges to write copy and produce, edit, or create a master (audio, video, or film) for a commercial taxable, and how does that differ from charges for copies (dubs)?
No — charges to create a master (including the copywriting used to create it) and charges to edit an existing commercial into a new master are not taxable, and studio time and video stock charged by…
How does a non-bank credit card processor taxed under Article 9-A source its credit card processing revenues for the receipts factor -- by where the services are performed, or by the Article 32 credit-card rules (merchant location, etc.)?
By where the services are performed. Peach Tree is a non-bank credit card processor taxed under Article 9-A, not the Article 32 bank tax. Its processing revenues (discount, authorization,…
Did a corporation retain Florida corporate-income-tax nexus when a Florida trustee managed its assets as assignee and litigated claims in Florida?
Yes. The Florida-domiciled trustee, acting as assignee, managed and controlled the corporation's assets and litigated in Florida to protect them, creating taxable nexus. If those Florida activities…
Was an individual's transfer of an aircraft to a revocable trust taxable when the trust paid nothing and assumed no lien?
No. The aircraft transfer was not taxable because the trust paid no consideration and assumed no outstanding lien. The transferor had to substantiate the gift with a sworn statement. A later…
Did Florida tax required training and software-support contracts, and how could a dealer recover tax collected on telephone-only support?
Required training was taxable as part of the hardware's total sales price. Support contracts were taxable when they maintained, repaired, or replaced software or hardware, but telephone-only support…
Could a contractor buy construction materials tax-free for a religious owner under a guaranteed-maximum-price contract that did not separately itemize and price every item?
No. Because the guaranteed-maximum-price contract did not separately itemize, describe, and price every item of tangible personal property, it was not a qualifying retail-materials contract. The…
Is a charge for disassembling a communications tower — including mileage, travel, per diem, loading, hauling, and unloading of the tower materials — subject to Texas sales tax?
No, not when those charges are separate and apart from any taxable work. The Comptroller told this taxpayer that charges for disassembling a ROHN tower — including mileage, travel, per diem,…
New York Advisory Opinion TSB-A-95(6)I: Issue raised by Petitioner, Heath Shuler, is whether, for purposes of Article 22 of the Tax Law, he can calculate his 1994 New York source income by allocating his pre-season and regular season football wages separately, basing each on the ratio of games played in New York to games played everywhere.
No. New York first confirms that nonresident professional team athletes allocate their income from playing games using a games-played-in-New-York over games-played-everywhere fraction, not the…
Is a federal section 468B 'qualified settlement fund' that holds cash and Treasury Bills subject to New York State franchise tax (Article 9-A) or New York State/City personal income tax (Article 22/30)?
Neither. The Steinhardt-Caxton Consolidated Settlement Fund is a federal section 468B qualified settlement fund holding only cash and U.S. Treasury Bills. It is not subject to Article 9-A franchise…
Could a county make exempt direct purchases of materials and services used by a private operator to maintain the county's water and wastewater facilities?
Yes, if the operation agreement was amended to incorporate the submitted direct-purchase procedure and all six Department criteria. The county had to order and buy directly, take title and…
When was Florida sales tax due on a cemetery company's preneed merchandise contract, and could merchandise supplied with a complete funeral be exempt?
Tax was not due when the cancelable preneed contract was signed because no actual or constructive delivery occurred until it became at-need. Tax was due at delivery. Merchandise furnished as part of…
Is a flat monthly fee charged to customers for Internet access service subject to Utah sales tax, given that all transmissions leave the state and usage isn't billed by the hour?
No. Charges for access to on-line services such as the Internet are not subject to Utah sales tax, and charges for interstate telephone communications are also exempt. Based on the contract details…
Were separately stated out-of-state storage charges included in California use tax when the equipment later entered California?
Yes. Because storage was part of the sale, its charge remained in the sales price whether separately stated or not; no California tax applied if the equipment never entered the state.
Did interstate route authority make every in-state vehicle haul interstate commerce for California use-tax purposes?
No. Cargo controlled. A mixed load containing interstate cargo counted as interstate use, but a wholly intrastate haul broke the historical continuous-interstate-use test.
How did California classify moveable storage systems and stationary shelving assembled and installed at a job site?
Prefabricated shelving was treated as fixtures, with job-site assembly included as fabrication. Separate guide rails and flooring treated as materials were excluded from each cabinet's historical…
What physical, licensing, and employee requirements made each video-game room a separate place under RR 95-13?
RR 95-13 required each video-game premises in a shared structure to have qualifying walls, a separate electric meter, its own employee present during all business hours, and separate local business…
Which pieces of an automated material handling system -- racking, forklifts, conveyors, computer controls, dust collection -- qualify for Utah's manufacturing sales tax exemption, and where does the 'continuous production cycle' end?
It depends item-by-item on whether each piece of equipment operates before or after the product reaches its finished, marketable form. Over a series of 1995 letters, a tax consultant helping a Utah…
When were leased business directories and prospect lists taxable property rather than nontaxable custom-information services?
Preprepared directories and most physical lists or media were taxable; a one-customer report could be a nontaxable service when its price reflected actual custom research and it was not reused.
Did a corporate officer's 1989 Chapter 7 case discharge a California tax assessment issued to him in 1992 and omitted from his schedules?
No. Staff said the later assessment could not be discharged in the earlier case and rejected the officer's claim that cited cases classified the liability as an older excise tax.
Could California enforce an earnings-withholding order against wages of an able seaman working aboard a covered vessel?
No. Staff concluded that federal maritime law required the employer to refuse California's order because covered seaman wages were protected from state tax withholding and attachment.
Did a vessel buyer's Chapter 7 discharge eliminate use tax when no return was filed and California was not listed as a creditor?
No. Staff said the unfiled return independently barred discharge, and the buyer's failure to schedule California provided an additional exception.
Can a company's electronic 'CPC Sales Tax Reporting' system, generated through a corporate procurement card, replace paper vendor invoices as acceptable documentation for Texas sales and use tax compliance?
Yes, with a major condition. The Comptroller ruled that the described procurement card sales tax reporting system will meet the office's data reporting requirements, but only if the vendor actually…
Is a natural gas broker that never takes title, possession, control or risk of the gas subject to the section 186/186-a utility taxes, or to the Article 9-A franchise tax?
Article 9-A. The corporation brokers natural gas between producers and end-users but never takes title to, possession of, control of, or risk of loss on the gas; its agreements identify it as a…
Was rekeying newly purchased but uninstalled locks taxable fabrication simply because the work occurred after the purchase date?
Yes, because the locks had not been installed or actually used. Time alone did not make them used property; customization to the customer's keys was taxable fabrication, not repair.
Is a computerized communications monitoring service for elderly, shut-in people taxable as a 'security service' in Texas if the provider must be licensed as an Alarm Systems Company under the Private Security Act?
Yes. The Comptroller checked with the State Board of Private Investigators and found that the taxpayer's computerized communications service for elderly people required licensure under the Private…
When a distributor for a direct sales/multi-level marketing company buys items for their own personal or business use (not for resale) and gets overcharged sales tax on the retail price instead of the company's wholesale price, how do they get a refund?
The direct sales organization normally collects tax from distributors based on the retail sales price. But for items a distributor buys for their own use (not resale), tax should instead be based on…
Does a nonprofit organized under IRC section 501(c)(4) qualify for Utah's religious-or-charitable sales tax exemption, even if a convention bureau told the organization it would be exempt and the organization relied on that in choosing to hold its event in Utah?
No. Utah's sales tax exemption for religious or charitable organizations under Rule R865-19S-43 is limited to organizations recognized by the IRS as exempt under IRC section 501(c)(3). A 501(c)(4)…
For a marketing company whose execution work is done by subcontractors, are receipts for services performed in New York (including by subcontractors) New York receipts, and how is a lump-sum fee covering work in and out of New York allocated?
Yes, and by relative value or time. Receipts from services performed in New York are 100% New York receipts whether the services are performed by the taxpayer's employees, agents or subcontractors.…
Does Utah's manufacturing sales tax exemption cover new equipment for a contractor's growing panel-manufacturing and insulation-lamination business, including equipment that also gets used in its construction activities?
Mostly yes, with several qualifications. A longtime drywall/plastering contractor that also manufactures prefabricated exterior panels and, separately, laminates insulation asked the Utah State Tax…
How did sales tax apply when a freelance special-effects coordinator either paid Vendor A and transferred the negative or had the producer pay the vendor directly?
Vendor A's qualified-service charge and the coordinator's related transfer were nontaxable; in the direct-pay version, the coordinator's consulting fee was also nontaxable.
Which parts of a Florida mortgage refinancing were subject to documentary stamp tax and nonrecurring intangible tax when the loan was assigned and increased?
Only the additional advance was subject to documentary stamp tax and nonrecurring intangible tax. The lender's assignment was not taxed, the renewal note did not exceed unpaid principal, and the…
How these rulings are useful
- See how the rule applies: A letter ruling shows how a state revenue department actually applied the tax law to a specific business and set of facts.
- Plan with confidence: Find a ruling with facts close to yours before you charge, remit, or claim an exemption.
- Binding only on the requester: A ruling is binding on the department only for the taxpayer who asked. It is persuasive, not a substitute for your own ruling or professional advice.
- Research across states: Compare how different states treat the same issue, from SaaS and food exemptions to nexus and contractor purchases.