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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Is developing and maintaining a client's confidential membership database an exempt 'personal or individual' information service, or a taxable sale?
It depends on whether each product is data conversion or a true information service, and the Department declined to classify them without more facts. Merely reformatting a client's own data is a…
Are a laboratory's materials-testing and R&D reports on unique client samples subject to New York sales tax as an information service?
Not taxable. Although the reports are an information service, each one analyzes a unique client sample and is not incorporated into reports for others, so it is personal or individual in nature and…
Before September 1, 1991, did a software marketer owe use tax on the base bank-software it bought from its parent to customize and sub-license to end users?
Yes, on its own purchases. Under the pre-September-1991 rule, the base software the marketer bought before tailoring it to any customer was taxable tangible personal property, so its payments to the…
Did Florida exempt shares and assets of an out-of-state municipal bond fund under its former intangible tax?
Yes, this revision answered all three exemption questions affirmatively, but it was later superseded by TAA 93C2-004S and should be read only as part of that revision history.
Did Florida documentary stamp tax apply to a note modification, out-of-state guaranty, or related UCC-1 filings?
No. The interest-and-payment modification did not enlarge principal, the out-of-state guaranty was contingent, and revised UCC-1 filings did not include the obligatory documents themselves.
If a concert venue gives a sponsor a VIP box seat and advertising in exchange for a sponsorship payment, does the venue owe sales tax on the box seat, and how much?
Yes. The Texas Comptroller ruled that a venue giving a sponsor a VIP box seat (worth $10,000, the normal selling price) in exchange for a sponsorship payment must report and remit sales tax on that…
Does a monument/cemetery contractor owe Texas sales tax on curbing, marble, and concrete work at gravesites, and does it matter whether the work is new construction or repair of an existing site?
It depends on whether the work is new construction or repair of an existing gravesite. Setting curbing and marble right after the vault is installed is new construction, which is untaxed labor; the…
Does a Texas sorority owe sales tax on meals served to its members, and are its membership fees and dues taxable?
Yes on the meals, no on the dues. The sorority house owes sales tax on the meals it serves to resident and guest members because Rule 3.293 taxes meals sold by boarding houses, and there's no…
When did South Carolina Revenue Ruling 93-4 treat computer-software maintenance and support contracts as taxable?
A maintenance contract sold with software was fully taxable, whether optional or mandatory. A separately sold or later contract was taxable when its true object was software or updates, but not when…
Were a private developer's purchases of materials for a pumping station that would be dedicated to the Providence Water Supply Board exempt from sales or use tax?
No. The developer had no construction contract with the Water Supply Board or Town of Johnston and was not a subcontractor under an exempt entity's contract. Required dedication of the completed…
Did owners of walls become owners of promotional posters placed there without permission for printed-message exemption purposes?
Yes. They obtained dominion and control and could dispose of the posters, so the recommendation allowed exemption and a refund reaudit without requiring legal title.
Are Mexican citizens exempt from Texas tax on cable TV service and municipal franchise fees, and do cable companies have to collect tax on those franchise fees?
No. Mexican citizens do not get a special tax break on cable TV service. Cable companies must collect tax on the full bottom-line price of their service, including municipal franchise fees passed…
Does a city owe sales tax when it demolishes a structure and removes debris from a landowner's property under its police powers?
Demolishing a structure down to the slab is not a taxable service, but removing the debris is. If one combined charge covers both, the whole charge is tax-free only if the debris-removal portion is…
Is the sale of a membership stock interest in a private Texas country club subject to sales tax?
It depends on who sells it. If an individual member sells his one membership stock interest directly to a new member (not habitually, and not through the club), it qualifies as an exempt occasional…
Is filling and plugging an abandoned underground storage tank (UST) in place, including removing residual product and disposing of it, a taxable service in Texas?
No. The Comptroller ruled that filling and plugging underground storage tanks in place, including removing and disposing of leftover product, is the functional equivalent of demolition, which is not…
Does a business owe Texas sales tax on candy sold through an honor-system box, where customers take a piece and leave payment on their own?
Yes. The Comptroller ruled that honor-system candy sales are subject to Texas sales tax on the total gross receipts, the seller must get a sales tax permit and file quarterly, and because the candy…
Does a Texas company have to charge sales tax on monitoring fees and installation fees for a personal emergency response (medical alert) system?
No. The Comptroller ruled that the monitoring fee and the one-time installation fee charged to subscribers of an emergency response system are not taxable, because the company was found not required…
Do sales/use tax and the oil well service tax apply to well tagging, inter-well tracing, and naturally occurring radioactive material (NORM) testing services performed on oil field equipment?
The well tagging and inter-well tracing services themselves are not subject to limited sales or use tax, but the taxpayer must pay sales tax on the materials and equipment (including radioactive…
When must I file the Nebraska Personal Property Return (Form 775P) to keep my LB 775 property tax exemption?
By May 1. Under Revenue Ruling 29-93-2, the Nebraska Personal Property Return (Form 775P), with its accompanying schedules, must be filed with the Department of Revenue on or before May 1 of each…
Did the Branemark Bone Screw device qualify for California's prescription-medicine exemption?
Not on the facts then available. California viewed it as a component of a dental prosthetic device with no independent significance, but left the issue open to new audit facts.
Was a unit-for-unit computer swap during a data-center move a taxable sale even when the replacement exactly matched the customer's system?
Yes. The company transferred its equipment for the customer's equipment and other consideration, creating a retail sale with a trade-in; installation labor remained excluded.
Do engineering and architectural design firms have to charge Texas sales tax on their professional design services?
Generally no. Texas does not tax engineering and architectural services on their own. A consulting engineer or architect designing the layout of a laboratory or office building does not owe tax on…
How did Florida apply documentary stamp and intangible taxes to mobile-home cooperative leases, stock, and purchase notes?
Occupancy documents were generally taxed on consideration, with minimum tax for qualifying original subscribers. Stock was taxed on par value; note parties owed stamp tax, and note and stock holders…
How much documentary stamp tax applied when a cooperative issued proprietary leases to original mobile-home-park subscribers?
Only the minimum 70-cent tax applied to leases for subscribers who committed funds before the cooperative bought the park, if proper tax was paid on the cooperative's acquisition.
Did four equipment bills of sale count as two exempt occasional-sale series under Florida's 1993 rule?
Yes, if they were the seller's only two sale series in 12 months. Three bills dated October 27 counted as one series and the November 13 bill as a second, but the official source notes the rule…
Was natural gas used exclusively to toast bread crumbs at a fixed manufacturing site exempt from Florida sales tax?
Yes, if the manufacturer gave its vendor a corrected certificate claiming the manufacturing boiler-fuel exemption. A refund of tax paid in error had to be requested first from the vendor.
Did a 1993 Florida ruling treat related-party office rent used for jointly guaranteed mortgage debt as nontaxable?
Yes, for the debt-amortization portion under the former rule, but the official source marks the ruling obsolete and superseded. Any excess payment remained taxable rent even in the original analysis.
Were meals sold by a continuing-care retirement community taxable to residents, nonresidents, and guests?
Resident meals were exempt under every described plan because the facility primarily cared for aged people dependent on special attention. Meals and rooms sold to nonresidents or guests were taxable.
Which of a medical distributor's dressings, IV components, diagnostic products, and other supplies were exempt from Florida sales tax?
Florida exempted specified dressings, tape, jelly, IV components, a catheter, arm sling, urine strips, and SureCell tests, but taxed several other products. Its treatment of the 60-cc syringe is…
Did terminal services or free customer use of small property areas create taxable Florida leases?
Terminal and pipeline charges were nontaxable bailments, and no rent was imputed for small areas used free of charge. Actual payments for office, dispatch, vehicle-storage, or repair space were taxable.
Did a city's direct purchases of building materials become sales-tax exempt after it assumed risk of loss under a public-works contract?
Yes. On reconsideration, Florida exempted the materials after the city bought builder's-risk coverage, retained title, and relieved the design-builder of loss risk through a contract amendment.
Could new Rhode Island residents use a California-tax basis instead of federal basis for IRC § 1042 replacement securities or claim a Rhode Island income modification on sale?
No. Rhode Island's personal income tax followed the taxpayers' federal § 1042 nonrecognition treatment and federal basis. California's earlier decision to tax the ESOP transaction did not create a…
Did a derrick barge qualify for the interstate-commerce watercraft exemption by lifting ocean-going ships and building port facilities?
No. The barge remained permanently in Southern California and did not itself transport persons or property for hire in interstate or foreign commerce. Tax applied to the barge and to materials used…
Were university meals sold to youths enrolled in an academic summer program exempt as meals sold by a school to its students?
Yes. The accepted, formally enrolled youths could earn school or college credit, so they were students and the university's meal sales to them were exempt.
Could California vehicle lessees credit Illinois tax paid after their lease had already begun in California?
No. The lessor made no timely purchase-price election, and the Illinois tax was paid after the vehicle had already been leased and used in California.
If a Texas manufacturing plant is sold to a new owner, can the new owner keep using the seller's predominant use utility study to claim a sales tax exemption on utilities?
No. Even if the manufacturing operations at the plant don't change, a change of ownership means the buyer must get its own predominant use engineering study done and secure its own utility exemption…
If I buy only generic office assets (furniture, computers, office equipment) from a business that has an IRS tax lien against it, paying by a check made out to the IRS, do I become liable for the seller's unpaid Texas sales tax as a 'successor'?
No. The Comptroller's office concluded that buying only miscellaneous, generic office items -- not the whole business or an identifiable segment of it -- does not trigger successor liability under…
Which production and packaging materials could a prescription-drug manufacturer buy without California sales or use tax?
Serum, yeast extracts, nutrients, containers, packaging, and labels qualified; processing agents, shipping tags, and advertising inserts were taxable.
Which drug-manufacturing and packaging inputs could a California prescription-drug manufacturer buy without tax?
Materials incorporated into the drugs and qualifying containers, packaging, and labels were not taxable; process consumables, shipping tags, and advertising inserts were taxable.
Does a certified fraud examiner who is licensed under Texas's Private Security Act owe sales tax on special investigations, fraud auditing, insurance claims work, and expert witness testimony?
Mostly yes. Because the examiner is licensed under the Private Investigators and Private Security Agencies Act, the special investigation, fraud auditing, and insurance claims activities described…
Does a Texas corporation owe sales or use tax when it distributes its equipment to shareholders as part of dissolving and liquidating the company?
No. The Comptroller ruled that when a corporation distributes its equipment to its shareholders as a liquidating distribution when the company dissolves, no sales or use tax is due, because the…
Does a Colorado-based securities broker-dealer and investment adviser owe Texas sales tax on its securities sales, commissions, and investment advice to Texas clients?
No, not on the securities trades or commissions — those are not taxable transactions at all. Investment advice given for a fee is also generally not taxable, unless the 'advice' is really packaged,…
Does a printing company owe Texas sales tax on repairs to the paper roll cores used on its printing equipment?
Yes. The Comptroller ruled that repairs to a printing company's paper roll cores are taxable. The cores qualify for the packaging-material exemption only when held by the manufacturer that ships…
Does a business that sells computer-generated Lotto number picks based on statistical analysis of past winning numbers have to collect Texas sales tax?
Yes. The Comptroller told this taxpayer that selling computer-generated Lotto number selections, based on analyzing past winning numbers and other statistical factors, is a taxable information…
Does a Texas seller owe sales tax on 'Passport Books' that give the holder free and discounted rounds of golf at participating courses?
No sales tax applies when the golf Passport Book is sold directly to the golfer who will use it, because the Comptroller treated the sale as a sale of an intangible right, not tangible personal…
Can an independent contractor working for a Texas customs broker sign export certifications, and can an export certification just reference an attached invoice instead of listing item descriptions?
No, not yet. Under Rule 3.360 as it stood in 1993, only the licensed customs broker or the broker's own employee (someone under the broker's direct supervision, paid regular wages, with taxes…
When a company ships everything into Alabama from out of state and makes few Alabama sales, does the corporate income tax 'throwback rule' overstate its Alabama sales factor — and can it apportion on a destination basis instead? And how is it classified for franchise tax?
The Department granted relief. Company A (an out-of-state corporation with a new Alabama distribution facility) showed that Alabama's income-tax 'throwback rule' — which attributes a sale to Alabama…
Is Texas sales tax refundable when an auction buyer takes possession of the item in Texas before the seller ships it out of state?
No. Once the buyer takes possession of a taxable item in Texas, sales tax is due and is not refundable, even if the seller later ships the item out of state. The interstate-shipment exemption under…
Can a company just start paying the county the property taxes on property that's exempt under Nebraska's LB 775 incentive agreement?
No — not voluntarily. Under Revenue Ruling 29-93-1, property tax on personal property that is exempt under the Employment and Investment Growth Act may not be paid to the county until either the…
Was a school-district fundraising foundation equivalent to a PTA for California sales-tax purposes?
No. Fundraising alone was too narrow compared with a PTA's broader objectives and services, so the foundation's auction receipts were taxable.
Can the sole shareholder of a dissolved corporation claim a sales tax refund for bad debts on accounts receivable that were assigned to the shareholder as part of the dissolution?
No. The Comptroller denied the refund because the shareholder, not the original dissolved corporation, was trying to claim the bad-debt credit, and Texas law does not treat a corporate dissolution…
Which charges on a repossession/debt-collection company's invoice are taxable, and can the company or its creditor-clients use resale certificates for repossession-related expenses?
Most of a repossession company's miscellaneous invoice items (storage fees, long-distance calls, informant fees, key-making) are taxable as part of the taxable debt collection service, except…
Does transferring a division's assets to a subsidiary in a Section 351/368 reorganization trigger investment tax credit recapture or forfeit the credit carryover?
No recapture, and the carryover survives. Transferring all of a division's assets to a wholly owned subsidiary in a tax-free transaction under IRC sections 351, 368, and 381(a) -- where the property…
Were a city utility's internal electricity transfers to city departments subject to Florida gross receipts tax?
Generally no, because they were internal transfers rather than sales. But purchased utility service acquired tax-free for resale was taxable on transfer, while service bearing upstream tax avoided…
Were transfers of graphics source code and specifications, per-copy royalties on derived programs, and annual support and update charges taxable in Utah?
Utah treated the transfer of source code and specifications as a taxable sale or rental of tangible personal property. A per-copy royalty paid when a licensee distributed derived programs using the…
Were an office-lobby espresso cart's pastries, cold food, juice, coffee, tea, and espresso sales exempt when no eating facilities were provided?
Yes, on the stated facts and with hot drinks separately priced. A lump-sum coffee-and-pastry combination would make the hot beverage taxable.
Were a reusable ligation clip applier and the implanted clips treated the same way for California sales tax?
No. California taxed the reusable applier as treatment equipment but treated the ligation clips that remained in the body as exempt.
Were lumber sales taxable when a separate California corporation issued resale certificates but supplier invoices named the related Mexican consignee?
Not if timely certificates were accepted in good faith. Separate California possession was not Mexican-entity possession, but invoices should name the actual purchaser.
Does an out-of-state company distributing satellite television programming to Utah bars, hotels, and nightclubs have Utah corporate franchise tax nexus, and are its receipts included in Utah's sales apportionment factor?
Utah has jurisdiction to tax the company (it has nexus), but that doesn't mean any revenue actually gets counted toward Utah's tax. Because the company is providing a SERVICE (delivering a satellite…
Must a California lessor collect use tax on rent when it has only one lease contract and no sales or use tax was paid on the property?
Yes. One lease can be a continuing sale, so the lessor must collect use tax from the lessee when the leased property was acquired without sales or use tax.
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