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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Did regular California conference exhibits and occasional order-taking require an out-of-state mail-order seller to collect use tax?
Yes under the historical rule applied. Representatives displayed products and sometimes took orders at California events, so the retailer was engaged in business even before later one-on-one sales calls.
Did the taxable price under a time-and-material construction invoice include fabrication labor and material markup when sales tax was separately itemized?
Yes. The contractor was treated as the retailer, and tax applied to the property's stated price including fabrication and markup, but not installation.
Is repair labor exempt from Texas sales tax for property damaged in a disaster area, and are Red Cross voucher purchases taxable?
Yes to both. Texas exempts separately stated labor charges to repair real or personal property damaged by the event that caused an area to be declared a disaster area, though the replacement parts…
Is Texas sales tax due on information services sold to a newspaper?
No. Under Tax Code Section 151.0038, sales of information services to a newspaper are excluded from Texas sales tax regardless of how the newspaper uses the information, and the seller does not need…
Is a chemist's paid consulting on the chemical properties of a manufacturer's products a taxable business-management service in Connecticut?
No. A chemist with advanced degrees who consults on the chemical properties of a manufacturer's hair care and hair color products is NOT providing taxable 'business analysis, management, management…
How did California apply sales and use tax to passenger photos, merchandise, supplies, and equipment sold or used aboard a San Diego-to-Ensenada cruise ship?
Inside California's three-mile limit, the onboard retail sales were subject to sales tax. Outside it, sales tax did not apply, but daily California contacts required use-tax collection from known or…
Did extending a tax-paid equipment lease create a new taxable transaction when the original lessee also had a 10% purchase option?
A true extension stayed rent-tax-free; an extension ending in title or a nominal option became a sale at inception taxed when it began.
How were parts and labor taxed when a manufacturer used its subsidiary or independent service centers to perform warranty repairs?
Repair labor was nontaxable. Parts under an optional warranty were consumed by the warrantor; parts under a mandatory warranty were treated as part of the original sale.
Can a racetrack buy simulcast horse/dog racing signals tax-free with a resale certificate, or does it owe sales/use tax on the simulcasting fee?
It depends on whether the receiving track charges admission. If the receiving track charges an admission fee to see the live or simulcast races, the simulcast signal is being resold as part of a…
Could a bank outside Florida's alternate documentary-stamp procedure use notes preprinted with the alternate-procedure statement?
Yes, but it still had to affix the proper adhesive tax stamps to each note and should cross out the preprinted statement or mark it not applicable. Only authorized participants could use the…
Which of a lender's ten open-end credit forms was subject to Florida documentary stamp tax?
Only the guarantor's agreement was taxable when signed by the co-maker, with tax based on the principal shown. The other nine forms lacked at least one required element of a taxable written obligation.
Can a direct pay permit holder resell repair parts or supplies to another company without losing its direct pay permit, if it didn't know at the time of purchase that the items would be resold?
Yes. A direct pay permit holder does not lose its permit by occasionally reselling items to another business, as long as it did not know at the time it purchased those items under the permit that…
Can a racetrack buy simulcast horse/dog racing signal services tax-free using a resale certificate?
Yes, but only if the receiving track charges an admission fee to see the live races and/or the simulcast. Because the simulcast is being resold as part of a taxable amusement service in that case,…
Can subsidiaries of financial institutions owned by the FDIC or RTC buy taxable items tax-free using an exemption certificate?
Yes. The Comptroller concluded that 100%-owned subsidiaries of the RTC (Resolution Trust Corporation) may purchase taxable items under an exemption certificate for use in operating the subsidiary…
Was an airport access fee taxable when a vehicle rental company passed it through to customers?
Yes. Whether characterized as a fee or tax charged by the airport, it was the rental company's expense. When passed to the customer, it became part of taxable rental receipts even if separately stated.
Under Florida's 1994 ruling, what use tax applied when finished goods inventory was moved into research and development?
Beginning November 8, 1994, the company had to pay use tax on the full manufactured cost of products removed from finished inventory for R&D. This result is historical: the official caution…
Were sales of Capri fig pollen to farmers exempt when the pollen was used to produce edible Calimyrna figs?
Yes. California treated the pollen as an annual plant used to produce food, though the farmer consumed it rather than buying it for resale into the fruit.
Does a direct sales (multi-level marketing) organization, rather than its independent Texas distributors, have to collect and remit Texas sales and use tax on sales made through those distributors?
Yes. The Comptroller told this direct sales organization that it, not its independent distributors, is responsible for collecting and remitting Texas sales and use tax on taxable sales its…
Was Genesolv 2000 solvent subject to Florida's water-quality pollutants tax?
No. Based on the supplied safety data sheet, Genesolv 2000 consisted of dichlorofluoroethane (CAS 1717-00-6), which the ruling said was not within the taxable-solvent definition.
What did the original Florida purchasing-card record-retention ruling say before it was revised?
It accepted a purchasing-card statement as an invoice substitute when it identified the precise taxing jurisdiction, required extra proof when it did not, and did not extend use-tax deadlines. TAA…
Is a landowner who digs up and hauls away contaminated soil that is a hazardous waste a 'generator' owing Connecticut's hazardous waste assessment, even if the pollution predates their ownership?
Yes. A landowner who excavates and removes contaminated soil that is itself a hazardous waste from a site IS a 'generator of hazardous waste' under Conn. Gen. Stat. § 22a-132 — and owes the…
Which focus-group coordinator charges were taxable when it supplied sponsors with food, videotapes, facilities, and participant solicitation?
Food, beverages, and videotapes sold to the sponsor were taxable; optional participant solicitation and facility charges were nontaxable under the opinion's service assumptions.
Was a wearable biofeedback speech-therapy system an exempt prosthetic device in California?
No. California said the system administered therapy to develop speech patterns rather than replacing an organ or assisting the larynx's production of speech, so its sales were taxable.
Did California's medical oxygen exemption cover delivery systems and cylinders used in a dentist's office?
No. The personal-use delivery-system exemption required a sale, lease, or rental to an individual for that person's use under physician direction; cylinders remained equipment, although the gases…
Is Texas sales tax due on the installation of permanent accent lighting in residential and commercial landscapes, and how does the contract type affect the tax?
Labor to install permanently attached exterior lighting is not taxable because it's an improvement to real property. Tax on the lighting and wiring materials depends on the contract type: under a…
Could Dr. Eduardo Castrejon avoid penalty and interest when employees failed to file two prepared 1990 CRS-1 returns and the Department did not notify him of the omissions until nearly four years later?
No. Employees acting as Castrejon's agents failed to submit the February and May 1990 CRS-1 returns and payments, making the omissions negligent under Section 7-1-69(A). Section 7-1-67 also made…
Was a medical emergency response card taxable when it represented both an information-transmission membership and prepaid telephone value?
No. The card was incidental to the medical-information service and an indicator of prepaid calling value; the provider was the consumer and owed tax when acquiring the cards.
Was a supplier's sale of a fully worn cervical collar to a chiropractor a taxable retail sale under a 1994 California letter?
Yes, if the item was an orthotic support or brace fully worn by the patient and used or furnished during professional services. The chiropractor was the consumer, so the supplier's sale was taxable…
Did calling an arrangement a service agreement avoid tax when the vendor supplied a computer and transferred digital images?
No. Customer possession of the computer was a lease, and supplying image disks or loading those images into the customer-held computer was a taxable sale.
Could an advertising agency identify nontaxable preliminary art as a creative service fee, and could it qualify when billed after or ordered with finished art?
Yes, if records proved the charge was separately stated preliminary work completed before approval to produce finished art; labels and invoice dates were not controlling.
What did the 1994 internal Comptroller memo say about whether prewiring a building for a burglar alarm system is taxable as a security service?
This is NOT a taxpayer-specific letter ruling — it's an internal November 1994 Comptroller staff email (with an attached Legal Services memo from Chung Chu Cha and a supporting letter from the Texas…
For the section 1505(b) test of whether more than 95% of an insurer's premiums are for annuity contracts, does premiums include reinsurance premiums and all direct premiums received both inside and outside New York?
Yes to both. For the section 1505(b) test of whether more than 95% of an insurer's premiums are received as consideration for annuity contracts, the term premiums means premiums as used in the first…
Who owed Florida sales or use tax when a broker sold a lump-sum custom-cabinet job and another contractor fabricated and installed the cabinets?
The cabinet contractor was the ultimate consumer and owed tax on the materials and full fabricated cost, excluding job-site fabrication labor as stated in the ruling. The broker owed no sales or use…
Was steam purchased from a cogeneration facility subject to Florida sales tax?
Yes. The ruling treated the metered steam as tangible personal property sold to the plant, not an exempt professional or personal service. The official status notice points to revised TAA 94A-055R…
Could Meridian Oil administratively protest the Department's planned release of its oil-and-gas audit report after the Department decided the report was not confidential under Section 7-1-8?
Yes. Section 7-1-24(A) allowed a taxpayer to protest the application of any Tax Administration Act provision. The Department necessarily applied Section 7-1-8 when it analyzed the statute's…
Is labor to install window and door screens taxable under Texas sales tax, and does it matter whether the job is new construction or repair/remodeling of residential versus nonresidential property?
It depends on the type of job. Installing window and door screens is treated as improving real property, and labor is NOT taxable when the screens are installed in new construction, unfinished…
Is tattooing a dog or other companion animal for identification purposes subject to Texas sales tax?
Yes. Tattooing a dog or other companion animal is a taxable graphic arts service because the animal is tangible personal property and imprinting tangible personal property is a taxable service. By…
Were sign-system drawings, sketches, models, and mock-ups taxable design products rather than nontaxable architectural services or preliminary art?
Yes. Clients and fabricators used the delivered designs, so the full contract receipts were taxable; preliminary-art and written-advice defenses failed, though limited credits were allowed.
Could a Florida marketing subsidiary apportion income from foreign product sales and management services?
Not for the post-May 1994 facts presented. The company did not show that a foreign country taxed it or had jurisdiction to tax it, so Florida found it ineligible to apportion. Earlier years required…
Could a corporate group stop filing Florida consolidated income-tax returns after a merger distorted its contractual allocation of tax?
Yes. Florida found good cause in the merger-related contractual change and resulting distortion and granted permission for separate returns for the specified tax year and later years.
Could a Florida bank claim the international-banking-facility income deduction when eligible accounts were not separately booked?
Yes, if the bank and activities met the cited definitions and the eligible asset and liability accounts were segregated or capable of being segregated. Actual separate booking was not required by…
Does a company that rebuilds customers' ink rollers for the printing industry owe Texas sales tax on materials and equipment, or can it claim a manufacturing exemption?
The company may buy rebuilding materials tax-free with a resale certificate, but must charge its customers tax on the full charge to rebuild each roller. Equipment used solely to rebuild customers'…
Should a manufacturer give its supplier a resale certificate or an exemption certificate when buying component parts or ingredients that will become part of an item manufactured for sale?
Either one. The Comptroller confirmed that a supplier may accept either a resale certificate or an exemption certificate in lieu of tax when a manufacturer purchases component parts or ingredients…
Was use tax due on a modified van resold before registration when the buyer could not adapt it to her needs?
Use tax remained due because the van accrued over 400 miles during ownership, but the fair market value of qualifying existing accessibility modifications was excluded.
Did selling a used accessible van before registration eliminate the purchaser's California use tax?
No. More than 400 miles during ownership supported California use, so tax remained due despite resale before registration. But the value of qualifying existing accessibility modifications was excluded.
If a nonresident's former-New-York-employer pension is paid out on a declining-balance schedule, a mortgage-style amortization schedule, or with interest that varies with the Consumer Price Index, does it still qualify as a non-taxable 'annuity' rather than taxable New York-source compensation?
Yes, in all four scenarios examined. New York taxes a nonresident's former-New-York-employment pension only if it fails to meet the regulatory definition of an 'annuity' under 20 NYCRR § 132.4(d)(2)…
Did PLR 94-11 apply South Carolina's historical $300 maximum tax to a research electron microscope?
Yes. Each item of the electron-microscope system qualified because it was used directly and exclusively to develop or improve membrane-filter applications and was located in a separate facility…
How were editorial-production charges taxed when manufacturing aids passed to the client before use, in-state proof copies were delivered, and final film negatives went to an out-of-state printer?
Manufacturing aids sold to the client before California use and in-state proof copies were taxable. Final negatives bought for resale and shipped out of state for client use were exempt if the…
Could a printer lease a stock photograph for resale and sublease it to the customer before using it in production?
Yes, if the printer contracted to sublease the photograph to the customer before use and then used it on the customer's behalf.
Which publishing-production items were taxable when work and intermediate deliveries occurred in California but final film shipped out of state?
Pre-use manufacturing-aid transfers and California photocopy deliveries were taxable, but negatives bought for resale, not used in between, and shipped out of state were exempt.
Did a tobacco-free herbal chew qualify for the food exemption merely because consumers chewed it like gum?
No. On the sparse facts supplied, counsel assumed the product was not actually gum; a functionally similar chew was not within the statutory gum exemption.
Are a limited partnership, a trust, and the holders of the trust's interests subject to Texas franchise tax?
None of them were subject. Under the pre-2008 franchise tax, a limited partnership and a trust were not subject because neither is a corporation, and the holders of the trust interests were not…
Does a nursing home operator owe sales tax on the disposable diapers it buys for use on its resident patients, or does the medical-supplies exemption cover them?
The nursing home operator owes sales tax on the diapers -- because it's buying them at retail to use while performing medical/nursing services for compensation, which is a specific exception to the…
Is the sales tax on club initiation fees due when a golf club sells founding memberships before the golf course and clubhouse are even built?
Yes. A membership payment counts as a taxable initiation fee as soon as it's required as a condition of joining the club, regardless of whether the club's facilities physically exist yet.
If a residential community requires every homebuyer to join a separately-run country club as a social member -- even though the same club also sells memberships to the general public on a first-come, first-served basis without any restrictions -- are the required social-membership dues and fees taxable as social/athletic club dues?
Yes. The mandatory requirement that every homeowner join is itself an exclusivity restriction that makes the club a taxable social or athletic club, even though the club sells other memberships to…
I'm planning a three-step real estate deal: (1) sell a small 5% stake in my two buildings to an outside investor for under $1 million, (2) contribute my and the investor's interests into a new limited partnership, and (3) later sell a 44% limited partnership stake for over $1 million. Does New York's Real Property Transfer Gains Tax apply to any of these three steps?
None of the three steps triggered the tax. A real estate developer owned two commercial buildings individually and planned a three-step restructuring: first, sell a 5% undivided interest in each…
My family's 71-acre estate has multiple houses on it -- my house, my brother's house, my sister's occasional-use cottage, and a caretaker's house -- plus outbuildings including a horse barn some neighbors use. If we sell the whole estate for over $1 million, is any of it exempt from New York's Real Property Transfer Gains Tax as our residence?
Yes -- the entire 71-acre transfer was exempt. The McIntyre family's estate in Dix Hills, New York -- a 71-acre parcel with four residences and nine outbuildings, including a horse barn -- had been…
Must a company that provides barricades, lights, and arrow boards to Nebraska contractors collect sales tax on the charge?
Providing this traffic-control equipment to contractors is a taxable lease, and tax applies to the whole charge. Under Revenue Ruling 1-94-2 (sales and use tax), persons providing barricades, high…
How did PLR 94-10 tax an out-of-state fabricated ornamental railing installed at a South Carolina dealership?
The ruling classified the railing as a unique product. Materials used to fabricate it out of state were not taxed because they were not sold and delivered to the contractor in South Carolina, but…
Is a Delaware business trust that is classified as a partnership for federal income tax purposes treated as a partnership, and not as a corporation, for New York Article 9-A franchise tax?
Yes -- it is treated as a partnership. Diversified Futures Trust I is a Delaware business trust that trades commodity futures, with a managing owner and public limited interestholders, and it…
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