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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Could a California-built computer-system prototype be bought for resale when it was used locally as a test bed before shipment to a foreign customer?
No. Local integration and problem-correction use made the prototype inputs a taxable retail purchase; the later foreign sale could be exempt only if Regulation 1620's shipment rules were met.
Were disks, duplication, manuals, and shipping for free beta software sent to about 2,000 testers exempt as printed sales messages?
The disks, duplication, and manuals were taxable; the printed-sales-message exemption did not cover software. Qualifying separately stated third-party shipping was not taxable.
Were beta-software disks, duplication services, and manuals sent free to testers exempt printed sales messages?
No. Software was outside the statute's narrow list, so disks, duplication, and manuals were taxable; qualifying separately stated third-party transportation remained nontaxable.
Is the income of a court-approved Section 468B qualified settlement fund subject to New York franchise tax or New York State and City personal income tax?
No. A designated settlement fund that is a qualified settlement fund under Section 468B of the Internal Revenue Code is not subject to New York franchise tax or to New York State or City personal…
When a New York City resident is about to take a U.S. Senate-confirmed executive-branch position and relocate to Washington, D.C., does his New York domicile change the moment the Senate confirms him, even though his family, home sale, and home purchase are all timed to that same event?
The Department declined to decide when (or whether) the taxpayer's domicile actually changes, because that is an inherently factual question that cannot be resolved in an Advisory Opinion. Instead…
In a New York City Industrial Development Agency (IDA) sale-leaseback financing arrangement, are a company's affiliated 'Group Agents' purchases, lease payments, and buyout payments to the IDA exempt from sales and use tax, no matter which affiliate actually pays the vendor or how bond proceeds are routed?
Yes, generally -- purchases and leases made by any affiliated Group Agent acting as the IDA's disclosed agent, and inter-affiliate cost allocations and reimbursements, are exempt from sales and use…
Metro-North Commuter Railroad asked whether four categories of employees who perform duties in both New York and Connecticut are 'regularly assigned' to more than one state under section 7 of the Amtrak Reauthorization and Improvement Act of 1990, so that their nonresident compensation is exempt from New York income tax and withholding.
Two of the four categories are exempt and two are not. Employees whose job descriptions systematically require work in both New York and Connecticut as part of a set territory or line segment…
How did South Carolina Revenue Ruling 93-8 tax basic horse and stock trailers compared with trailers containing a camper package?
Basic trailers, tack- or dressing-room trailers, and goosenecks without camper packages were taxed at the full 5% historical rate. A trailer with a camper package paid the lesser of 5% or $300.
Could a machine be tested in California before its productive use solely in Illinois without triggering use tax?
Yes, if California activity was limited to preproductive testing of the machine. Practice runs testing suitability or operator ability were taxable use.
Could intercompany fixed-asset transfers avoid sales and use tax because no invoices or cash payments were issued?
No on the record presented. Staff treated paired intercompany debits and credits as consideration because the petitioner supplied no records supporting another explanation. The recommendation made…
Was a California supplier's delivery of aircraft parts to the foreign buyer's in-state agent exempt when the agent later used a freight forwarder?
No. Agent possession was buyer delivery before irrevocable export commitment; direct supplier shipment to a forwarder could qualify on all other conditions.
Does a subcontractor owe Texas sales tax on labor charges for cutting, sawing, coring, or drilling concrete?
It depends on the job. Cutting, sawing, coring, or drilling concrete tangible personal property not yet installed, or existing nonresidential real property, is a taxable service, so the…
Is renting out a topsoil-screening machine subject to sales tax, or exempt as production equipment?
It can be exempt, but only in specific circumstances. Renting a 'power screen' topsoil-screening machine is normally a taxable retail sale under Tax Law sections 1101(b)(4), 1101(b)(5), and 1105(a).…
Does a Texas city owe sales tax on chairs, tents, and other equipment it provides for cemetery funeral services or convention center room rentals?
No. The Comptroller ruled that a city does not have to collect sales tax on equipment (chairs, tents, artificial grass) it provides for graveside funeral services at a city cemetery, because that's…
Does a company have to collect Texas sales tax on charges for setting up and supervising a contest?
No. The Comptroller ruled that charges for setting up and supervising a contest are not taxable services, but the company must still collect tax on any materials and prizes it sells to its client.
Could employee salary-reduction amounts paid through a qualified cafeteria plan count as employer contributions for California's historical employer child-care credit?
Yes. Employee-designated salary-reduction amounts could count as employer contributions even though employees excluded them from income, but only when the amounts paid for a qualified care plan…
What was the taxable measure when a public television donor received a low-value premium for a much larger contribution?
The station's cost of the premium was the measure when donation was the primary purpose and its amount significantly exceeded the property's retail value.
What was the tax measure when a public television viewer made a large donation and received a much lower-value thank-you item?
When the contribution primarily supported the station and significantly exceeded the item's retail value, the transfer was a sale but tax was measured by the station's purchase price, not the full…
Could a bank deduct its delinquent loan from funds captured by California's deposit-account levy?
Only if a pre-levy security agreement covered the account. Otherwise the bank had no setoff right and had to remit all levied funds; any excess after the secured debt also went to California.
Does a bareboat rental (no crew) get taxed differently than a boat charter that comes with a captain?
Yes. Renting a 'bareboat' (just the boat, no crew) is a taxable rental subject to limited sales tax, while chartering a boat WITH a captain is normally a nontaxable transportation service (e.g., a…
Can a company that buys and sells a chemical used to clean up oil spills issue or accept a resale/exemption certificate on that chemical, and is the oil-spill clean-up service itself taxable?
A retailer that buys the chemical only to resell it as-is may issue a resale certificate to its supplier. But a company that uses the chemical to perform a clean-up service must pay tax on it,…
Could a restaurant buyer reduce the sales-tax measure by suing to reform or rescind the contract after paying the price into escrow and taking possession?
No under the Legal Division's view. The signed contract, escrowed price, and possession completed the sale, so staff used the original agreed price despite the buyer's pending suit. The source…
Were a nonprofit's rentals of donated beds and medical equipment subject to use tax?
Generally yes, measured by rental receipts, because no purchase tax had been paid; specified mobility devices could be exempt when leased for personal use as physician-directed.
Does a bank have to include 'credit amounts' used to reduce its service charges in its gross receipts for Texas franchise tax purposes?
No. The Comptroller ruled that 'credit amounts' used to calculate bank service charges are not receipts to the bank for Texas franchise tax purposes, because they merely reduce a service-charge…
When a heating contractor rents mobile boilers to supply temporary heat to an exempt organization's building while installing a permanent system, does the contractor owe sales or use tax on the boiler rental?
Yes. Although the contractor's service of providing temporary heat to the exempt organization is not taxable, the contractor owes sales or use tax on the mobile boilers it rents, because rented…
Were installments received after July 1, 1989 from a Rhode Island Lottery prize won before that date subject to personal income tax?
Yes. Rhode Island taxed lottery winnings when received after July 1, 1989, regardless of the drawing or winner-determination date. The client's pre-1990 win did not preserve the former exemption for…
When a social club collects membership dues and activity fees and forwards part of them to another club it shares facilities with, which club must report and remit the sales tax?
The club that bills its members must collect and remit the sales tax itself. A social club owes tax on its dues and on activity fees it charges members, cannot shift that tax onto the club it shares…
Is a company's information service — a listing of area events sent to newspapers, radio stations, and TV stations — subject to New York sales tax?
No, when sold to news media. Information services are normally taxable in New York, but the law expressly excludes information services used by newspapers, radio, and TV broadcasters in collecting…
How did Florida's former intangible tax apply to shares of a business trust holding exempt and non-exempt securities?
Shares were fully exempt when the trust's portfolio held only exempt government obligations. If the portfolio included non-exempt securities at the tested year-end valuation point, the shares were…
Did Florida's borrower-residence exception apply when individuals borrowed against a home titled to their revocable trust?
No. The individuals were the borrowers, but the trust owned the mortgaged home and the trustees granted the lien. Because the collateral was not real property owned by the borrowers, the one-time…
Was documentary stamp tax due when a partnership deeded pre-July 1986 unencumbered land to current partners for no payment?
No. Because the land was unencumbered, there was no shifted mortgage burden or other consideration. If a mortgage or other encumbrance had remained, tax would have been due on its outstanding…
When did a bulk equipment order count as one sale for Florida's $5,000 county discretionary-surtax limitation?
A written order for a specific quantity delivered within a definite stated time counted as one sale, even with installments, multiple invoices, or back-orders. The same rule applied to new and…
Did a printing-machinery agreement qualify for the pre-July 15, 1991 fixed-price rate, and were the seller's on-site assembly charges excluded as installation?
No. Adjustable pricing and a clause making the buyer responsible for all taxes defeated fixed-price treatment, while on-site assembly was taxable fabrication in the full contract price.
Did subtitling a motion picture for a new language or foreign audience restart the pre-broadcast transfer exclusion after the picture had reached its original general audience?
No. Later language or territory did not create a new general audience, although subtitle work was nontaxable and unused films could still move through resale and export rules.
How did California tax limited rights to use and reproduce a stock photograph when the client had to return the photo?
The transaction was a taxable photo lease. The agency collected use tax, included royalties in rent when received, and rejected resale certificates for mere reproduction use.
Is labor to build and attach a metering station to an existing pipeline taxable as remodeling, or exempt as new construction?
Taxable as remodeling. The Comptroller ruled that attaching a metering station to an already-existing pipeline is a modification/upgrade of that pipeline, not new construction, so the labor to build…
A grave-opening/closing service provider for funeral directors asked the Comptroller several questions: is backhoe/truck/driver grave-opening and closing labor taxable, is it a taxable equipment 'rental' if billed separately, how is selling and installing a concrete burial vault taxed, and is setting up a tent and chairs at graveside a taxable rental?
No to all of them, with a billing caveat. Grave opening/closing labor is a nontaxable service, but if you separately state a charge for the backhoe, truck, and trailer (even with a driver), the…
What did South Carolina announce about public access to Tax Commission decisions through March 1993?
Sanitized Commission Decisions and an index covering 1987 through March 31, 1993 were available for public review at the University of South Carolina School of Law Library and Commission district…
Is a Texas company's 1-800 toll-free telephone service subject to Texas state sales tax on calls that originate outside Texas but are billed to a Texas address?
No. Under this 1993 Texas Comptroller letter, only 1-800 calls that originate within Texas and are billed to a Texas billing address are subject to Texas state sales tax. Calls that originate…
Does a beauty salon or aesthetician owe Texas sales tax on shampoo, tonics, and conditioners it buys and uses on customers?
Yes, in part. A beauty salon or aesthetician owes Texas use tax on supplies (like shampoo, tonics, and conditioners) it uses to perform nontaxable services such as facials, and must also collect and…
Were police sales of vehicles acquired through asset-forfeiture laws exempt from California sales tax?
No. Taking forfeited title without consideration was nontaxable, but later agency sales of the vehicles were taxed like other transactions.
Were police purchases of replacement vehicles exempt because they were paid from sales of forfeited vehicles?
No. Vesting seized property in the agency was nontaxable for lack of a sale, but later vehicle sales and purchases were taxed under the ordinary rules.
Does a property management company owe sales tax on an 'overtime air conditioning' fee it charges tenants?
No. The Comptroller ruled the overtime air conditioning charge is not taxable, because the property management company already paid sales tax to the electric or gas utility and is using the utility…
Does Texas sales tax apply to food purchased for a guard dog?
No. Texas sales tax does not apply to food for guard dogs, as long as the dog has been professionally trained for guard duty by someone in the business of training guard dogs and is not kept as a pet.
Is electricity used to show a vacant model home or house exempt from Texas sales tax as residential utility use?
No. Electricity a real estate agency buys for a vacant home used to show or demonstrate the property to prospective buyers is taxable as commercial use, not exempt residential use — the same is true…
Was the United States Postal Service exempt from Texas motor vehicle tax, and did its vehicles need exempt license plates?
Yes, the United States Postal Service was exempt as an instrumentality of the federal government. Vehicles owned by the United States or its instrumentalities were not required to display exempt…
Are Kool-Aid Kool-Pumps, popsicles, snow cones, and individually sold ice cream novelties subject to Texas sales tax?
Yes. The Comptroller ruled that Kool-Aid Kool-Pumps are not a food product and are taxable whether sold individually or in a box of six, and that popsicles, snow cones, and individually sold ice…
Could a South Carolina fee-in-lieu project under the historical Section 4-29-67 consist only of manufacturing machinery and equipment?
Yes. The project could consist solely of machinery and equipment; land and buildings were not required, provided all other statutory fee-in-lieu requirements were met.
Under South Carolina Revenue Ruling 93-6, when were charges for extended warranties subject to sales or use tax?
A warranty sold with tangible personal property was taxable in full, even if optional and separately stated. A separate warranty bought after the property sale was not subject to sales or use tax.
How did FAR 52.245-5 affect California purchases for an Antarctic federal services contract, and why did construction materials remain taxable?
Direct and qualifying indirect property could be bought for resale if federal title passed before use, but construction materials and fixtures remained taxable to the contractor.
Could a wallboard manufacturer buy lignin, potash, and alpha foamer for resale because they remained in the finished board?
No for lignin and potash: they were taxable manufacturing aids. Appeals recommended relief for foamer only because the taxpayer had relied on a published staff annotation, while recommending tax on…
Do admission charges for amusement events at a venue listed in the National Register of Historic Places owe Texas sales tax, and can collected tax on those tickets be refunded?
No sales tax is due on admission to amusement services held exclusively at a place listed in the National Register of Historic Places, but any tax already collected from patrons on…
Is an Ottawa yard tractor (a yard-spotting tractor used to move trailers around a yard) a taxable motor vehicle or is it subject to Texas limited sales and use tax?
An Ottawa yard tractor is subject to Texas limited sales and use tax, not motor vehicle sales tax, because it is not a motor vehicle and not rolling stock. The Comptroller confirmed that yard…
Are a telephone company's receipts from private line circuits taxable as intrastate telephone service, or excluded from sales tax as interstate telephone service?
It depends on geography. Private line circuits that begin and end within New York are taxable intrastate telephone service; circuits that cross the state line are exempt interstate service. Where a…
Are Japanese specialty sweets made from beans, flour, rice powder, and sweeteners exempt 'food' in New York, or taxable candy and confectionery?
Exempt. The Department ruled these traditional Japanese sweets — cakes, pastries, powders, and gelatins made from azuki beans, flour, rice powder, and sweeteners — are exempt food and food products…
Which fees in a computerized securities-trading information network — directory listings, oral transmissions, delivery-instruction processing, broker referral premiums, and corporate-release fees — are subject to New York sales tax?
It splits by function. Fees to receive compiled trading information (including bundled directory listings and oral or Alert transmissions) are taxable information services; pure advertising listings…
Are multi-part 'bill of lading' shipping forms, sold to a manufacturer's client, exempt from Texas sales/use tax as packaging supplies?
Corrected answer (April 12, 1993): a manufacturer-client may issue an exemption certificate for the bill-of-lading forms, but must then self-assess use tax on the cost of any part(s) of the form…
How did Texas handle vehicle tax when a lemon-law vehicle was refunded, upgraded, downgraded, replaced, or leased?
An actual trade-in toward an upgraded replacement was taxed on the price difference; otherwise the new vehicle was taxed in full and a refund claim filed for the returned vehicle. A trade-down…
Which flight-school charges were exempt instruction and which were taxable aircraft rentals under Florida's 1993 rules?
Classroom training, ground school, briefings, critiques, and supervised solo flights within the course were exempt instruction. Separately rented aircraft and solo flights after course completion…
Could a South Carolina real-estate appraiser represent a taxpayer in an administrative property-tax valuation matter after the 1993 amendment?
Yes. A real-estate appraiser registered, licensed, or certified in South Carolina under Title 40, Chapter 60 could represent a taxpayer in the administrative tax process, but only on matters…
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