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 a Florida corporation owe documentary stamp tax on unsecured debentures issued entirely outside Florida?
No. The corporation's directors authorized the transaction in Florida, but the manual signature work, printing, sale, and delivery of the unsecured debentures occurred outside the state, and no…
Do ostriches, emus, and rheas (ratites) raised for slaughter qualify for the same Alabama tax breaks as 'poultry' — the sales/use tax exemptions, the reduced machinery rate, and the ad valorem exemption?
Yes. The Department ruled that ostriches, emus, and rheas — flightless birds called ratites, raised for slaughter for meat and by-products — are included within 'poultry' for Alabama tax purposes…
How did successor liability apply when a company sold 90% of its business, kept 10%, and planned a later sale of the remainder?
The first buyer was liable absent clearance or withholding, though the Board lacked facts to decide whether an auditor's copy of the agreement started the three-year limit. A later buyer of the…
Was a photographer's sale exempt when an advertising firm claimed to buy as agent for the National Potato Promotion Board?
Potentially, but the facts did not establish agency. The sale was exempt only if the firm met every regulatory agency requirement or resold the photographs before use. The photographer could be…
Was labor taxable when assembling customer-furnished electronic kits or repairing previously assembled, used computers and printers?
Kit assembly was taxable fabrication because it completed production. Labor merely restoring used computers and printers was nontaxable repair, though repair parts remained taxable.
Were materials in complimentary copies of ordinarily sold newspapers exempt when copies went to employees, VIPs, political groups, or sales prospects?
Generally yes for copies distributed free to people, but not for advertising tearsheets or copies consumed internally in producing the newspaper.
Could New York tax paid by a vehicle lessor offset California use tax on rents after the lessee moved the vehicle to California more than 90 days later?
No. The lessor owed no California acquisition tax to credit, while the lessee separately owed California use tax on rents once the vehicle entered the state.
Who reported sales tax when an artist's representative found illustration jobs, billed clients, collected tax, and retained a 25% commission?
If the representative was the illustrator's agent, the illustrator was the retailer and reported the client's full payment, including the commission; resale treatment required proof.
Is labor to repair a parking lot damaged by an underground explosion taxable if the repair work was done after October 1, 1993?
Yes. The Comptroller told the taxpayer that because the parking lot repair labor was performed in November 1993 — after the October 1, 1993 effective date of new Tax Code Sec. 151.350 — that repair…
Can a corporation deduct dividends from a mutual fund under Connecticut's dividends-received deduction when the fund's payouts are exempt-interest or capital-gain dividends?
It depends on the type of distribution. Under Connecticut's dividends-received deduction, Conn. Gen. Stat. § 12-217(a)(D), a corporation may deduct 'dividends as defined in the federal income tax…
Were delivered cold box lunches and buffets taxable when the caterer only unpacked them and left disposable plates and utensils?
No. Cold box lunches and buffets were exempt without serving, but carbonated drinks, hot combinations, on-site grilling, and full-service catering were taxable.
Did California use tax apply when a maintenance provider retained refurbished parts here before its technician installed them at an out-of-state customer site?
No, when retained only for the provider's own outside installation. But California shipment for customer installation would complete the provider's use here.
Did California use tax apply when optional-maintenance repair parts briefly returned to California before the warrantor installed them out of state?
No, when the company retained them only for shipment and its own installation outside California. Customer installation after California title passage differed.
What made a pre-July 1, 1993 construction agreement a fixed-price contract eligible for the temporary half-percent rate exclusion?
It had to be timely binding, lack unconditional termination, fix all costs, and fix tax on a tax-included basis or by an amount or rate that could not increase.
Is faxing coupon advertisements to a list of recipients a nontaxable advertising service or a taxable telecommunications service in Texas?
It depends on what the customer is paying for. Assembling and distributing a collection of coupons is a nontaxable advertising service, but the fax transmission itself is a taxable…
If I buy something from an out-of-state company that delivers it into Texas, who has to pay or collect the use tax — me or the company?
It depends on whether the seller is permitted in Texas. The Comptroller told this individual purchaser that because COMPANY A (the vendor they bought from) is permitted in Texas, COMPANY A is…
Is sales tax owed on wireline services performed on oil/gas wells to obtain seismic or geological data in Texas?
No. The Comptroller ruled these wireline services are not subject to sales & use tax. Instead, the receipts are subject to the 2.42% well servicing tax under Texas Tax Code 191.081. Sales tax is…
I'm structuring a turnkey deal where I sell my client a vacant lot, buy it back at the same price, build a building on it as construction financing, then sell (or lease) the finished building back to the client. Will New York's Real Property Transfer Gains Tax apply when I transfer the finished building back?
The Department wouldn't give a yes-or-no answer -- it depends on facts an Advisory Opinion can't resolve. Deegan Development Group, Inc. owned a parcel of land and proposed a turnkey arrangement for…
Could California apply refund interest and later-period overpayments against a still-disputed earlier determination and net quarter-specific debits against credits without a new notice?
Yes. The letter treated redetermination as an ongoing process permitting offsets and allowed netting where the overpayments were made while the debit periods remained assessable.
Did customer credits earned from prior purchases enter taxable gross receipts when used on a later sale?
No. The Board reconsidered its earlier advice and treated the credits as trade discounts excluded from the taxable measure.
For a Texas motor vehicle repair, can the repairman charge the customer sales tax on parts at a price lower than what the repairman paid for those parts?
No. In a separated repair contract (materials and labor billed separately), the agreed sales price of parts and consumable supplies that the repairman charges the customer sales tax on cannot be…
Did an out-of-state association and publisher with only mailed publications and Florida members have to collect Florida tax under the 1993 physical-presence rule?
No, under the historical Quill physical-presence rule applied in 1993. With no Florida representatives, offices, property, inventory, or other presence, the association and publisher did not have to…
Did distributing a magazine to dues-paying association members make part of their dues taxable as a subscription charge?
No. No stated or implied part of the membership dues paid for the magazine, and neither members nor nonmembers could buy it separately, so the association did not collect tax on dues. Because the…
Were separately stated freight charges taxable when a California office sent an order to its Texas factory for direct shipment to a California customer?
Not necessarily. Common-carrier freight up to actual cost was excluded if the goods were not sold delivered; own-facility or delivered-price freight also required a sale before shipping.
Is a 'lane closure' (barricade) service provided to a highway contractor a taxable service, or is it treated as equipment rental for Texas sales tax purposes?
It is not a taxable service. The Comptroller ruled that the total charge for 'lane closure' (barricade) services is treated as a rental of equipment to the contractor, and is taxable as a rental —…
Is thin capitalization tested on a book or fair market value basis, and is interest on a loan used to fund a distribution exceeding shareholder equity deductible for Article 9-A?
Thin capitalization is tested on a fair market value basis, not a book basis. Indopco borrowed $700 million from a brother/sister corporation to pay a dividend to its parent when its book capital…
Did a salesperson's dedicated cubicle in a customer's Florida office defeat an out-of-state manufacturer's Public Law 86-272 protection?
Yes. Florida concluded that the customer maintained an office for the corporation's benefit because its Florida employee exclusively used the furnished cubicle to conduct the corporation's business.…
If a 501(c)(3) nonprofit and a for-profit company form a 50/50 joint venture to build affordable housing, can the joint venture buy construction materials free of Texas sales tax?
Only partly. The Comptroller ruled the joint venture may issue an exemption certificate for 50% of the cost of the incorporated building materials and consumable supplies — matching the nonprofit…
Is installing a patented lawn-fertilization control device as part of a new or existing underground sprinkler system a tax-exempt capital improvement, and does that change if it's just replacing an existing pump?
Yes -- installing the device as part of a new underground sprinkler system, or adding it to an existing one, is a capital improvement and not subject to sales tax, because it permanently increases…
How did South Carolina Revenue Ruling 93-12 calculate the historical retirement-income deduction for a surviving spouse?
A surviving spouse could claim one deduction for the survivor's own retirement income and a separate deduction for income attributable to the deceased spouse. For the inherited stream, the survivor…
Are the entry fees participants pay to enter a tournament subject to Alabama sales (amusement) tax when the organizer collects the fees and pays them all back out to participants as prize money?
No. A 501(c)(3) sponsor ran a national tournament hosted in one Alabama city in 1994 and another in 1997, drawing more than 50,000 entrants who each paid an entry fee. Alabama's § 40-23-2(2) imposes…
When a manufacturer expands by adding a new product line that shares some processes and equipment with an existing line, does the manufacturing sales tax exemption cover equipment used by both lines?
It depends on whether the equipment is used exclusively by the new line or shared with the existing line. Equipment used exclusively for the new product line qualifies for Utah's manufacturing…
Do X-ray dyes and contrast materials used in hospital diagnostic imaging, and surgical appliances like pacemakers, sutures, and bone cement, qualify for Utah's sales tax exemption for 'medicine'?
No to both. The Tax Commission ruled that X-ray dyes and contrast materials, and surgical appliances/substances such as pacemakers, sutures, and bone cement, do not qualify for Utah's sales tax…
Were pulse oximeters and related monitoring devices exempt from California sales tax because federal law restricted their sale?
No. On the assumed uses described in the opinion, California treated the monitors and sensors as taxable diagnostic appliances rather than exempt medicines.
Did lender foreclosure and business closure prevent section 6829 liability for a corporate officer who failed to pay accrued sales tax?
No. Staff said the officer's filing and payment duties survived foreclosure, and liability could include sales with tax reimbursement added even if the customer never paid.
Did the Comptroller change the manufacturing exemption policy for equipment (dies, photoengravings, presses) used by printers and publishers?
No. The Comptroller reviewed the proposed policy change and decided not to change the existing manufacturing exemption policy that had applied to printers and publishers for several years. Because…
If a 501(c)(3) organization bundles hotel lodging, meals, and tuition into one lump-sum price for an educational seminar, does it owe sales tax on the meals and hotel tax on the lodging?
The meals charge is exempt from sales tax (the organization can issue an exemption certificate for meals whether eaten at the lodge or off-site), but the organization still owes hotel occupancy tax…
Is a hyperbaric oxygen chamber exempt from Texas sales tax when it is rented to a for-profit hospital?
No. A hyperbaric oxygen chamber is a therapeutic device that is exempt when rented directly to an individual patient under a doctor's prescription, but it is taxable when sold, leased, or rented to…
Is a real-time financial-data terminal service (stock tickers, quotes, market news) delivered over leased telephone lines to desk-top display units subject to the additional 5% telephone/telegraph tax on top of the regular information-service tax?
No -- the service is a taxable information service under Tax Law Section 1105(c)(1) because it isn't personal or individual to any one subscriber, but it escapes the additional 5% tax under Section…
What South Carolina individual income-tax brackets and formulas applied for 1993 and 1994 under this notice?
The notice supplied six inflation-indexed brackets ranging from 2.5% to 7% for both years, with regular and shortcut formulas. For 1994, the bracket thresholds were $2,170 increments through…
Did four free customer and product-user newsletters qualify as periodicals under California's section 6362.7 exemption?
Yes, assuming product publicity stayed within the statutory limit across the full 12-month test period.
Were charges for modem-to-modem stock quotations taxable when customers could obtain the service without buying the provider's hardware?
No, assuming the quotation service transferred no tangible property and customers could subscribe without purchasing or leasing hardware from the provider.
If a city installs speed bumps in a neighborhood and bills the private citizens or businesses who requested them, does the city have to collect sales tax on that charge?
No. The Comptroller ruled that installing speed bumps is remodeling of nonresidential realty (a taxable service), but the city does not have to collect sales tax on the charges billed to the…
Is a tree/plant examination and disease-treatment consultation service (arborist services) taxable under Texas sales tax, and can a referral fee paid to another business reduce the tax base?
Yes. The Comptroller ruled that arborist services — consultation, diagnosis, and treatment of landscape plants — are taxable, and tax must be collected on the entire charge to the customer,…
Were cost-based charges by South Carolina legislative agencies for copies of or access to public informational documents subject to sales tax in fiscal 1993-94?
No. State and local sales tax did not apply when a legislative agency charged the public or another person for copies of or access to legislation or informational documents and the charge reflected…
Do a surviving corporation's pre-merger Connecticut net operating loss carryovers survive an ownership-change merger, free of the federal Section 382 limit?
Yes. Where a corporation is the SURVIVING corporation in a merger (here a reverse triangular merger in which the purchaser's new subsidiary merged into the holding company, and the holding company…
Could manufacturers buy transfer film for resale when all of one product transferred, but another left a plastic backing as waste?
Yes for both. One film transferred entirely, and the other's primary purpose was to incorporate its pattern into the finished product despite leaving backing residue.
Can a mail-order company use an average industry shipping rate to calculate its exempt, separately stated shipping charges for periods before September 1, 1991, and does the shipping exemption still apply after that date?
No -- an Advisory Opinion can't resolve a factual question like whether $1.04 per package matches an industry-prevailing shipping rate, and there was never any rule letting an average rate…
Was a vessel transfer between two corporations nontaxable merely because a divorce settlement required the husband to arrange the purchase?
No. The memorandum treated the transaction as one corporation selling a vessel to another, not as community property passing to a spouse as separate property. The divorce agreement did not make that…
How is Texas sales tax applied to selling, renting, installing, or servicing water softeners and reverse osmosis units — and does it matter whether the units are plumbed into a building or whether the customer just pays for a water-conditioning service?
It depends on three variables: whether title to the equipment passes to the customer (sale vs. rental vs. service), whether the unit is plumbed into the building (making it an improvement to realty)…
Is transferring property to a brand-new, not-yet-capitalized corporation in exchange for 100% of its common and preferred stock a taxable sale under Texas sales tax?
No. The Comptroller confirmed that transferring property to a non-capitalized corporation in exchange for 100% of that corporation's stock — even if the stock is split between common and redeemable…
Were monthly charges for cleaning chemicals, brushes, maintenance, and supposedly free restaurant sterilization dispensers taxable service receipts?
Yes. Customers obtained use and control of the dispensers, making the arrangement a taxable lease, and the related chemicals, brushes, delivery, and maintenance joined the taxable receipts.
Did an out-of-state municipal-bond fund with no Florida office, employees, property, or secured loans have Florida corporate or intangible-tax obligations?
No corporate return was required if the fund remained a separate entity with no direct Florida nexus, and the fund itself was exempt from the historical intangible tax. Its shares were fully exempt…
Does producing a motion picture, video, or audio recording for sale, license, distribution, broadcast, or exhibition count as manufacturing for Texas sales tax purposes, and can a producer buy or rent production materials, equipment, and services (like film processing, dubbing, and editing) tax-free?
Yes. The Comptroller ruled that producing a motion picture, video, or audio recording that will be sold, licensed, distributed, broadcast, or exhibited is treated as manufacturing. A producer can…
If a parent company spins off an equipment subsidiary and that subsidiary then leases the equipment back to the parent or a sister company, is tax due on the lease payments?
Yes. The Comptroller ruled the lease payments Equipment Company A receives from the parent (ABC) or from sister company Company B are taxable, because these are operating leases between related…
Would correcting a deed that conveyed only mineral rights instead of the intended fee title trigger Florida documentary stamp tax?
A new quitclaim deed conveying the omitted fee title would be taxable on the property's fair market value because the original deed's face transferred only oil, gas, and mineral rights. A court…
Could a retailer prove an export exemption without the bills of lading or other documents required by California’s regulation?
Possibly, but the retailer still had to convince the factfinder that the necessary export facts existed. The regulation required retaining the specified documents, and the taxpayer bore the burden…
Were consumer-instruction labels sold to restaurants, retailers, and packers exempt?
Yes, when purchasers affixed them to qualifying containers sold with the product; otherwise the label sales were taxable.
Is manufactured brine water (made by pumping fresh water into an underground salt formation) exempt from Texas sales tax the same way plain water and table salt are exempt, and is non-food salt like rock salt or ice cream salt taxable?
No — the Comptroller ruled that brine water made by pumping fresh water into a salt formation to dissolve the salt is 'processed' water, not naturally occurring brine, so the charges for the brine…
If an information provider subcontracts the gathering of proprietary information to a third party, does the information stop being 'proprietary' for Texas sales tax purposes?
No. The Comptroller overruled an earlier letter that had taxed these charges, holding that information gathered by a subcontractor for a provider who then sells it to a client still keeps its…
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