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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What portions of low-emission vehicles and retrofit devices qualified for the historical section 6356.5 exemption?
Properly documented incremental costs of certified new vehicles and qualifying labeled retrofit devices were exempt; a dealer-retrofitted used vehicle was not.
How did California's January 1, 1993 amendment change tax responsibility for interstate drop shipments to California consumers?
It extended section 6007 to sales occurring outside California, making an in-state-engaged manufacturer or wholesaler the deemed retailer and requiring tax on the consumer's marked-up price.
After January 1, 1993, which California-engaged seller was deemed the retailer when an out-of-state retailer used a wholesaler and manufacturer to drop-ship to a consumer?
The California wholesaler was deemed the retailer even if another supplier physically delivered on its behalf; the supplier became liable only if neither the wholesaler nor actual retailer was…
Did the $5,000 discretionary sales surtax limitation apply to each monthly electricity bill for each metered account, and how could a utility recover excess tax?
Yes. The cap applied to the electricity charge on each bill for each metered account. After refunding customers, the utility could apply on Form DR-26 within 36 months, supported by records and…
Was a maternity home's cost reimbursement plus management fee excluded from a cafeteria operator's gross receipts as a Szabo-type subsidy?
No. Because residents paid nothing and the home supplied the operator's entire remuneration for those meals, the fee was gross receipts, subject to a possible institutional-meal exemption and…
Texas Letter Ruling 9211590L: Utility Study — New Study Required If Change Of Ownership
Yes. When a manufacturing business changes ownership, the new owner must have its own predominant use study performed and kept on file to claim the sales tax exemption on electricity purchases, even…
Were meals sold pay-as-you-go to residents of a retirement complex with a minimum age of 55 exempt as institutional meals?
No. The complex did not meet the cited age-and-flat-rate definition, so the contractor's pay-as-you-go dining-room meal sales were taxable.
When were radiopharmaceuticals sold for PET imaging exempt from California sales tax?
California exempted radiopharmaceuticals applied to a patient for imaging when sold to a qualifying health facility for treatment; other uses or buyers were taxable.
Could Texas use the proposed account-credit procedure to refund vehicle tax after a manufacturer repurchased the vehicle?
No. Comptroller John Sharp said motor vehicle tax was paid to county tax assessor-collectors at title and registration, not remitted by the manufacturer or seller to a Comptroller taxpayer account.…
We closed a commercial mortgage loan where our borrower is a tax-exempt nonprofit. Our commitment letter said the borrower would reimburse us for all closing costs, including mortgage recording tax. We paid the special additional mortgage recording tax at closing -- can we now collect it back from the borrower under that contract clause, given the borrower's exempt status?
No -- the statute's allocation of who pays overrides any private reimbursement agreement. A mortgage lender's client made a commercial mortgage loan to a tax-exempt nonprofit borrower (exempt under…
Did adding each medical customer's names, rates, passwords, forms, and office data make standard software custom?
No. With no separate customization charge or evidence that customization exceeded half the contract price, the programs remained prewritten.
Was a computer-system seller liable for software tax when an agreement showed it acted as the developer's agent?
Not for 1988. The agreement rebutted the seller inference for that year, but the recommendation did not extend the agency finding to the other periods.
Texas Letter Ruling 9211L1204G09: Out-of-State Client — Investigation Performed Out-of-State by Texas Firm
No Texas sales tax is due when a Texas-based private investigator conducts an investigation by phone from Texas for an out-of-state client and out-of-state subject, as long as the results are…
What value measured documentary stamp tax when affiliated corporations exchanged unencumbered Florida and out-of-state property without money or debt?
The fair market value of the Florida real property measured the tax. Because the county property appraiser's assessment was presumed to reflect fair market value, the Department approved the Orange…
Is a bio-absorbable dental tissue-regeneration device sold to dentists exempt from New York sales tax as a prosthetic aid or a medical supply?
It's a medical supply under § 1115(a)(3), not a prosthetic aid. That means it's taxable when bought by a dentist for use in providing dental services for compensation, but exempt when sold to a §…
Does an elevator company owe use tax on materials it uses in taxable maintenance and repair jobs, and can it recover that tax?
Elevator maintenance and repair is taxable on the full invoice price (unless it's a capital improvement). The company can claim a refund or credit for tax paid on materials that become part of the…
What should readers use instead of Florida TAA 92C2-017 for the municipal-fund business-trust valuation issues?
Use revised TAA 92C2-017R. The official original begins with 'Refer to TAA 92C2-017R,' and the revised ruling expressly says it supersedes this November 4, 1992 advisement.
Did a subsidiary's Florida real estate transfer to its surviving parent in a statutory merger incur documentary stamp tax when no deed was given?
No. The Department concluded that real property passed to the surviving parent by operation of merger law and was not taxable unless a deed was given. Filing articles of merger and recording a…
Could movie-poster artwork qualify as preliminary art when the buyer's standard contract claimed ownership of all vendor materials?
Only after the contract excepted preliminary art from the ownership transfer, and only if the other requirements were met; client possession of roughs had to be temporary for review or the charge…
My clients, a married couple both now in bankruptcy and heading toward divorce, jointly own a 37-acre residential property. My client moved out several months ago due to marital discord, but her husband still lives there. If their bankruptcy trustees sell the property (including to a tax-exempt buyer) for $1.5 million, does the personal residence exemption from New York's Real Property Transfer Gains Tax still apply, given my client's recent absence?
The residence exemption still applies -- a spouse's few-month absence due to marital discord, with the other spouse continuing to live there, doesn't break the exemption, and neither does the…
I want to transfer my three New York properties -- including my personal residence -- into a revocable living trust to avoid probate, keeping full control and the right to revoke at any time. Will funding the trust trigger Real Estate Transfer Tax or Real Property Transfer Gains Tax? And will my residence be exempt from gains tax when the trustee eventually sells it after I die?
Both exempt. Hilles Timpson planned to transfer her Southampton personal residence, a New York City residence used by relatives rent-free, and a New York City rental property (each worth over $1…
How should a Kansas county treasurer calculate delinquent property-tax interest after BOTA or another competent authority reduces the property's valuation?
Recalculate the tax first, then apply the statutory delinquent-interest rate or rates to the adjusted tax due. When BOTA or another competent jurisdiction reduces the valuation, the treasurer should…
Could a Kansas county appraiser, county clerk, or county commission waive a statutory property-tax listing penalty for a late filer?
No. The directive says county appraisers must impose the prescribed penalties and that appraisers, clerks, and county commissioners may not abate them. For a penalty under K.S.A. 79-1422, only the…
Are Kansas property tax directives issued before November 1992 still good authority?
No -- they were wiped out in 1992. This directive states that 'effective immediately, all prior directives, memoranda, and written or oral instructions issued by any Director of Property Valuation…
Does placing print advertisements in Texas newspapers (including national inserts and free-standing inserts) create nexus requiring a mail order company to collect Texas sales tax?
No. The Comptroller ruled that placing one-page ads in Texas newspapers, in national publications distributed via Texas newspapers, in shared advertising booklets inserted in Texas newspapers, or as…
Texas Letter Ruling 9211L1203A01: Thirteen Period Accounting Calendar Year
Yes. The Comptroller granted permission for a group of affiliated corporations to keep filing Texas sales tax returns based on their 13-period fiscal accounting calendar instead of standard calendar…
Texas Letter Ruling 9211L1202G12: Layaway Sales — Tax Increase Or Tax Rate Change Before Customer Obtains Possession Of Tpp
The tax rate in effect when the layaway contract was executed applies to the whole layaway sale, even if a local tax rate increase takes effect before the customer pays off the balance and takes…
Texas Letter Ruling 9211L1202G11: Does a carpet installer collect sales tax on materials under a separated contract?
Yes. Under a separated contract for selling and installing carpet in a residence, the dealer is the seller of the incorporated materials, must give a resale certificate to its supplier, and must…
Does a Texas carpet dealer collect sales tax on materials only, or on the whole job, when installing carpet in a residence?
It depends on how the invoice is written. Under a separated contract (materials and labor billed separately), the dealer collects tax only on the stated materials charge and gives suppliers a resale…
Texas Letter Ruling 9211563L: Does a company owe sales tax on temporary security guards hired to supplement its existing security force?
It depends on whether the guards are licensed security personnel or true temporary help. If the guards are licensed by the Board of Private Investigators and Private Security Agencies, the charge is…
Does an aircraft-rental company pay sales tax on fuel it pumps into planes for 'wet' rentals, and can it recover that tax?
The lessor must pay sales tax on fuel at the pump even though it's bought for resale, but can then claim a credit (on the FF schedule, Form ST-100.10) against the tax it collects on the wet rental.…
Are a country club's membership fees and dues taxable when membership is by invitation only and restricted to a defined group?
Yes. Because the club restricts membership by invitation only — an attempt at exclusivity beyond mere facility size — it's a taxable 'social or athletic club,' so its fees and dues are subject to…
For a multi-tier chain of controlled foreign corporations, does a company's share of a lower-tier CFC's Subpart F income keep the character (subsidiary capital vs. investment income) of the company's OWNERSHIP IN THAT LOWER-TIER CFC, or does it instead take on the character of the company's ownership in the FIRST-TIER CFC through which the income is deemed distributed?
The company's pro-rata share of Subpart F income from ANY tier of controlled foreign corporation -- first-tier or lower -- is deemed a dividend paid up the chain and takes on the character of the…
Was a commercial mailer's charge for upgrading a customer's mailing list to ZIP+4 taxable, and when were related folding charges taxable?
ZIP+4 upgrading was nontaxable when part of a mailing service; folding was nontaxable only when incidental to mailing and otherwise taxable as fabrication or part of a print sale.
Were charges for computer-generated artwork, graphics, designs, or logos taxable when the finished output became the customer's property?
Yes. When the computer-generated output was the true object, the full artwork, graphic, design, or logo charge was taxable.
Were charges for computer-generated artwork taxable when the customer sought the resulting logo, illustration, graphic, or design?
Yes. When the true object was the computer-generated output rather than the production service, charges for artwork, graphics, designs, and logos were taxable.
Was a printer's charge for folding an advertisement taxable when the folds allowed insertion into an envelope?
Usually yes as part of a printed sale or fabrication, but not when folding was merely incidental to a nontaxable mailing service and separately stated as required.
Was a commercial mailer's charge for upgrading a customer's mailing list to ZIP+4 taxable?
No under the stated assumption. When the mailer provided only nontaxable mailing services, ZIP+4 upgrading was part of preparing material for mailing.
Were a printer's sales of fundraising literature to a nonprofit customer exempt from California sales tax?
No. Nonprofit status alone did not exempt the printed matter; related folding was taxable unless merely incidental to a qualifying mailing service.
Was a commercial mailer's charge for upgrading a customer's addresses to ZIP+4 taxable, and how did tax apply to related printing work?
ZIP+4 upgrading was nontaxable when it was part of a nontaxable mailing service. The letter separately taxed several printing and output scenarios.
Texas Letter Ruling 9211L1199G12: Hotel — Trunk Lines Purchased For Own Use And For Resale To Guests — Resale Certificate Guidelines
No. A hotel that buys a trunk line for telecommunication service and resells part of that service to guests cannot give its telecom provider a resale certificate for the basic local exchange…
Does a Texas pallet manufacturer have to collect sales tax when transportation companies buy replacement pallets, even though the old pallets are returned to distributors?
Yes. The Texas Comptroller ruled that the pallet manufacturer must collect sales tax from the transportation companies buying the replacement pallets. The fact that the removed pallets may later be…
How did the public access South Carolina Tax Commission Decisions issued from 1987 through September 30, 1992?
The letter said sanitized Commission Decisions and an index covering 1987 through September 30, 1992 were available for public review at the University of South Carolina School of Law Library and…
Do carry-out pizza and wholesale-bakery retailers that prepare food for consumption elsewhere qualify for the noncommercial-use sales tax exemption on the fuel and electricity they use, the same way manufacturers do?
No. Even though a carry-out pizza shop or a bakery preparing food for later consumption uses gas and electricity to "produce or compound" a resold product -- similar to a manufacturer -- Utah Code…
Which machinery in a sulfuric-acid cogeneration project qualified for Florida's energy-production sales-tax exemption?
The project generally qualified, and fixed-location machinery necessary to produce steam or electricity for manufacturing qualified under the integrated-plant approach. The 11-mile Plant A-to-Plant…
Does Utah sales tax apply to the federal excise tax portion of cigarette prices sold from vending machines?
No — separately stated federal excise tax is not subject to Utah sales tax, as long as accounting records consistently reflect the sale price separately from the federal excise tax. A physical sign…
How did Utah tax water-conditioning equipment sales and leases, repair parts, extended warranties, and a proposed monthly water-service fee?
Utah approved the requester's first five stated industry practices, including exempt separately charged installation labor and tax on equipment sales or rentals, supplies, and stated repair charges.…
Does a computer-integrated manufacturing (CIM) system that also handles some administrative functions qualify for Utah's new-and-expanding manufacturing equipment exemption?
This record shows a dispute, not a clean final answer. An initial Auditing Division response denied the exemption under § 59-12-104(15), reasoning that a computer-integrated manufacturing (CIM)…
Texas Letter Ruling 9210L1200F09: Caterer — Definition — Treated As Restaurant
Yes. The Comptroller ruled that a caterer is treated the same as a restaurant for Texas sales tax purposes, so it owes tax on tangible personal property it rents to put on catered events (tables,…
Texas Letter Ruling 9210L1200F03: Recycling Plant — Manufacturing Process Begins With Shredding — Also Machinery/Equipment Used
Yes. The Texas Comptroller ruled that a company shredding old tires into three-inch squares for eventual processing into rubber crumb (to be resold in products like mats and mud-flaps) is engaged in…
Under South Carolina Revenue Ruling 92-12, how did the historical 5% tax and $300 maximum apply when boats, motors, and boat trailers were sold alone or together?
The historical $300 maximum applied to a boat sold alone and to a boat sold with a permanently attached motor; otherwise the ordinary 5% rate applied. A motor sold alone and an ordinary boat trailer…
Is renting out pedal boats, bumper boats, and aqua cycles on a waterway taxable as a rental of tangible personal property in Texas?
Yes. The Texas Comptroller ruled that renting bumper boats, pedal boats, and aqua cycles on public or private waterways is a taxable rental of tangible personal property, both before and after…
Texas Letter Ruling 9210L1198D01: Caricature Artists/Cartoonists Charges For Drawings At Party/Parties
Yes. Caricature drawing is a sale of taxable tangible personal property (graphic art), so the artist must collect sales tax on the total charge. But if the artist is hired by an amusement-service…
Texas Letter Ruling 9210L1205A08: Storage Tank — Above Ground With 500 Barrels Less Or More Capacity — Tpp Vs. Improvement To Realty
Yes, taxable. Each tank in the battery held only 400 barrels, under the 500-barrel line that keeps a tank classified as tangible personal property in Texas. Because it stayed TPP rather than…
Texas Letter Ruling 9210L1200G07: Navigation District — Loading Dock Facility Construction — Lump — Sum And Separated Contract Guidelines
It depends on the contract type. Building a loading dock for a navigation district (a political subdivision) is an improvement to realty. Under a lump-sum contract, the contractor pays tax on all…
Can a trash-removal company buy portable compactors tax-free for resale when it supplies them to customers as part of its trash-removal service?
No. Because the hauler and its customer both use the compactors as part of one bundled trash-removal service, the compactors aren't purchased for resale — so the hauler owes sales tax on buying…
Are golf country club membership dues and initiation fees taxable when members have no control, no proprietary interest, and membership is limited only by the size of the facility?
No. Because members won't control the club, won't hold a proprietary interest, and membership is limited only by the physical size of the facility (not exclusivity), the club isn't a taxable 'social…
A nonresident who was a longtime key employee of a family-owned New York publishing business received a $1.2 million payment for agreeing not to compete, made as part of the family's sale of the business to an outside buyer. Is that non-compete payment New York-source income subject to New York State personal income tax, and if so, how much of it is taxable?
Yes, at least in part. The Department ruled that a payment for an agreement not to compete, made in connection with the sale of a business, is New York-source income to the extent it derives its…
Did a Warwick airline caterer have to collect sales tax on separately stated airport port fees added to its food invoices?
Yes. The caterer's gross receipts included both the food charge and the separately stated port fee passed through to the airline. Sales tax therefore applied to the total invoice amount, not just…
Can one California retail sale make a person a seller and retailer, or does seller status depend on whether the person entered the business of selling?
One isolated sale did not by itself make someone a seller, but a contract contemplating more machines showed a selling business. Once a seller made a retail sale, that seller was immediately a retailer.
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