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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How did California tax turbine-engine repair parts, testing, trade-ins, and other separately stated repair charges?
Aircraft exemptions did not cover parts installed on an engine before it entered California. Parts, rotable exchanges, and trade-in value could be taxable, while qualifying repair labor and testing…
Did the builder exemption for a commercial dry dock survive a sale to a related corporation and leaseback to the builder?
No. The builder's first sale of the over-eight-ton dry dock was exempt, but the related buyer's leaseback was taxable because that corporation was not the builder. Operating-lease tax followed…
Does a microwave carrier collect New York sales tax on local vs. interstate telecom service, and is its transmission equipment exempt?
Local yes, interstate no, and the equipment can be exempt. Local Area Telecommunications, a microwave common carrier, must collect New York sales tax on charges to customers for local (intrastate)…
Can an interior design and space-planning service qualify for the capital-improvement exclusion from New York sales tax?
No. Hafner Associates' interior design and space-planning services — layouts, lighting design, millwork elevations, finishes and furnishings specifications, and project management presented on…
Could a homeowners association use Texas's historical prior-contract exemption for garbage service, and how was its separately stated garbage charge treated?
The letter said qualifying fixed-rate homeowner contracts entered before July 22, 1987 could support the historical exemption, while quoting a statutory note that the exemption had no effect after…
Which stuck-pipe recovery, gamma-ray, cement-bond, and casing-inspection services were subject to sales tax or Texas's 2.42% well-service tax?
The described gamma-ray/cement-bond and casing-inspection logs were not subject to sales tax or the 2.42% tax. Locating and cutting stuck tubing was subject to sales tax but not the 2.42% tax. The…
Were intraocular lenses sold in Texas exempt from sales and use tax as prosthetic devices?
Yes. The Comptroller classified an intraocular lens as a prosthetic device and said it was exempt from Texas sales and use tax.
Were charges for college transcripts taxable when a governmental educational institution furnished them under a statutory mandate?
No. Providing the transcripts under law was a governmental service rather than a sale, even though the institution could recover its service cost.
Which radio-dispatch, signal-boosting, and elevator-phone services were taxable telecommunications or telephone-answering services?
Radio signal amplification and retransmission was taxable telecommunications. Dispatching that answered radio calls and routed them to land lines, plus elevator-phone answering, was taxable…
Were liquid eggs, frozen eggs, egg substitutes, and unheated hard-boiled eggs exempt from Texas sales and use tax?
Yes. Liquid and frozen eggs and egg substitutes were exempt food. Hard-boiled eggs were also exempt when sold unheated and without eating utensils. A seller with no taxable Texas sales did not have…
Were charges for storing customers' data records taxable as a rental of real-property space when the storage company controlled the records and customers needed its cooperation to review them?
No. The arrangement was an exempt bailment rather than a taxable lease or license of storage space. Customers kept title to their records but transferred possession and control to the storage…
Did interstate long-distance access charges enter a South Carolina local telephone carrier's corporate license-fee receipts after October 4, 1991?
Yes, prospectively. For returns originally due after October 4, 1991, interstate long-distance access charges entered the receipts used for the Section 12-19-110 license fee. That fee was limited to…
For California's printed-sales-message exemption, must a mailing house act only as the purchaser's agent?
No. A mailing house could act for the seller, in which case its mailing or delivery counted as delivery by the seller; purchaser-agent mailing houses were also allowed.
For California sales tax, should section 1031 exchange equipment be valued at original cost, book value, or negotiated exchange value?
Use the realistic exchange value negotiated at arm's length. The exchange remained a sale for California tax even if federal income-tax gain was not recognized.
Which member and guest charges at a nonprofit Texas golf and country club became taxable on October 1, 1991?
Monthly dues, initiation and transfer fees, guest and green fees, range and trail fees, locker and bag storage, cart storage, locker rentals, minimum food charges, and golf or tennis club dues were…
How did Texas's October 1, 1991 amusement-tax change affect prepaid country-club dues, cart storage, opening fees, party cover charges, and gratuities?
Charges paid before October 1 stayed untaxed even for later service. Later member-privilege and cart-storage charges were taxable; the club could not buy charging electricity for resale.…
Could a separately formed used-equipment dealer buy affiliated equipment and repair or upgrade it tax-free before resale or auction?
Yes. A separately formed legal entity operating as a used-equipment dealer could buy the affiliated companies' used equipment and the parts and services needed to repair or upgrade it tax-free for…
How did California tax translations delivered on paper or disk, multiple copies, typeset proofs, artwork, formatting, and desktop-publishing output?
Translation and composed text were nontaxable, including one paper copy or disk; multiple copies and output containing artwork were taxable, with allocation where needed.
Was a charge to recreate paper blueprints or electrical schematics as accurate CAD files taxable?
Yes. California treated the charge as taxable because the contract's true object was the computer-generated drawing output, not merely drafting services.
Was a condominium association's 50% share of laundry-machine receipts taxable when it let a machine company place and maintain coin-operated washers and dryers on association property?
Yes, for periods beginning July 1, 1986. The arrangement granted the machine owner a taxable license to use the condominium's real property, and the 50% revenue share was taxable consideration. The…
What South Carolina tax interest rate applied from January 1 through March 31, 1992?
The rate for tax underpayments and overpayments from January 1 through March 31, 1992 was 9%. Interest generally compounded daily, while underpayments of declaration of estimated tax used simple interest.
Were weekly nonprofit concession-stand sales irregular or intermittent under California's youth-organization rule?
No. Sales at bingo games held once every week were regularly scheduled, so the organizations were retailers rather than consumers under section 6361.
Did frequent-buyer dollars earned on prior taxable purchases enter the taxable measure when redeemed on later merchandise?
No. They were treated as trade discounts when earned from taxable purchases; later cash collected for an invalid redemption became taxable when received.
How did Texas treat state contracts for abandoned strip-mine reclamation that permanently incorporated lime into the land?
The December 11 letter replaced a November 25 opinion and treated the reclamation as real-property improvement. After House Bill 11, consumed items were not exempt under Section 151.311; a separated…
How did Texas tax railroad-track materials and labor for new construction versus repair, remodeling, or renovation?
Rails, ballast, bridges, trestles, ties, and other essential track materials were exempt; depot and nonessential construction materials were taxable. New-construction labor was not taxable, while…
Was an aircraft charter used to transport passengers subject to Texas sales tax?
No. The Comptroller said sales tax was not due on an aircraft charter for passenger transportation or on individual tickets for travel on a common carrier.
How did South Carolina's December 1991 dealer guide calculate sales tax on vehicles and trailers sold to nonresidents?
The sale was taxed at the lower of the buyer's home-state tax or the South Carolina tax, and South Carolina tax was zero if the home state would not credit tax paid here. The guide supplied December…
Did a Mexican pedimento simplificado prove export well enough to support a Texas sales-tax refund?
No. Rule 3.323 required formal destination-country entry documents. For Mexico, the letter required a pedimento de importaciones with a computerized certified customs number, or alternatively a…
If a Utah refinery processes gold and silver bullion for an out-of-state mining company and the bullion is then sold to a third party who takes delivery outside Utah, does that sale count as a 'Utah sale' in the corporation's apportionment sales factor?
It depends on the throwback rule. If the seller is not taxable in the state or country where the buyer takes delivery, the sale is 'thrown back' and counted as a Utah sale in the sales factor under…
Were ocean cargo containers exempt when manufactured in Mexico, delivered to a California lessor, filled here, and shipped abroad?
No. Buying raw materials in California did not make the seller an in-state manufacturer, and filling the leased MTE containers here was their first functional use.
Was a jointly funded artificial-intelligence software-development agreement a taxable custom-software sale or nontaxable contract programming?
The developer's retained legal rights controlled: retaining rights made the arrangement a custom-software sale taxable to the extent used in Texas; retaining no title made it nontaxable contract…
How did Texas tax labor and materials for removing rust and rechroming a motor vehicle's grille and bumpers without alteration?
Rechroming the grille and bumpers was repair of component parts. Labor was not taxable, but materials were. Under a lump-sum repair the repairer paid materials tax and charged the customer no tax;…
Were charges for a computerized telephone weather-and-advertising service taxable when customers did not control the equipment?
No. Advertising and franchise fees were nontaxable when the provider retained control and performed all equipment operations, while the provider paid tax on its equipment and supplies. Radio…
New York Advisory Opinion TSB-A-91(9)I: May Federal Trust Fund, a regulated investment company, and its shareholders treat the fund's 'Exempt Obligations' - federal government obligations whose interest is subject to federal tax but exempt from New York State tax - as 'obligations of the United States' for purposes of the Tax Law § 612(c)(1) subtraction, and, provided the asset and notice requirements are met, may shareholders subtract the portion of their dividends attributable to interest on those obligations from their New York taxable income?
Yes to both questions. The Department ruled that Federal Trust Fund's 'Exempt Obligations' - obligations of the federal government or its agencies/instrumentalities whose interest is taxable…
When did recurring motel repainting qualify as scheduled maintenance instead of taxable restoration or remodeling?
A recurring cycle alone was insufficient. The motel needed fixed, regular schedules or work orders showing repainting was planned before paint declined. Repainting faded, damaged, blistered, or…
Were a for-profit partnership's assumption of hospital lease, guaranty, and indenture obligations—and its mortgage securing those obligations—exempt from Florida intangible tax?
Yes. The partnership could not claim the nonprofit health-facility exemption, but the obligations had separate statutory protection: lease-payment obligations were exempt because the hospital…
How were shares of an out-of-state business trust valued for Florida intangible tax when its portfolio held U.S., territorial, Florida-government, and potentially taxable securities?
The exempt portion depended on the portfolio held at the valuation date. Net asset value attributable to direct U.S. and territorial obligations was exempt; the remaining portion was exempt only if…
Were a credit union's open-end credit agreement, request for advance, and secured revolving-credit request subject to Florida documentary stamp tax?
No. Although the member signed all three forms, none contained both a written promise to pay and a sum certain in money. The open-end agreement promised repayment of future advances without stating…
Could a partnership renew a promissory note without new Florida documentary stamp tax after its general partners changed?
Yes, if the partnership agreement allowed partner substitutions without dissolving the partnership and all renewal-note requirements were met. The partnership itself could remain the original…
Is the fee to cancel a computer-equipment lease subject to New York sales tax, and does a later reimbursement of that fee change the answer?
Yes, it's taxable. Omori & Associates paid a termination fee to end a five-year computer-equipment lease early (to upgrade to new IBM equipment). Because a lease of tangible personal property is a…
Did a purchaser owe use tax when the seller was properly liable for California sales tax?
No. The letter said section 6401 exempted the purchaser from use tax when the seller was properly liable for sales tax.
Which consultation, installation, handling, custom-programming, shipping, and other charges were taxable in a computer-network sale?
Standalone consultation and installation were nontaxable, but preliminary consultation and handling tied to the network sale were taxable; qualifying shipping could be excluded.
Did a lease qualify for the July 1991 rate-increase exemption when the lessee agreed to pay future tax increases?
No. Every payment, including tax, had to be fixed. Section 12 shifted later tax increases to the lessee, so the total obligation was not fixed.
Did copy machines and supplies used to reproduce customer documents qualify for Texas manufacturing exemptions?
The copying business was treated as a manufacturer. Direct-use copiers with the required useful life qualified for the historical phase-in exemption when purchased in the stated period; financing…
Are a contractor's cable-TV installation and testing charges to a cable company taxable, and when do resale, capital-improvement, or exempt-organization rules apply?
Generally taxable, with several carve-outs. A contractor's charges to a cable-TV company for the 13 listed services (testing, splicing, wiring, trenching, drop-cable installs, pole transfers, etc.)…
When did Shaklee Instant Protein Drink Mix become taxable after its label began saying to use it only as a food supplement?
California reclassified it as taxable prospectively on January 1, 1992; retail sales before that date remained nontaxable.
Could a Texas provider of taxable services separately state bond and insurance costs and leave them out of the sales-tax base?
No. The November correction revised the attached June letter and said bond and insurance costs connected with selling a taxable service remained taxable even when separately stated.
When software is sold as one unit combining a taxable insurance-rating database and nontaxable custom software, is the whole price taxable?
The whole price is taxable when sold as one unit. Insurance Automation Systems sold a two-part insurance-quoting system (June 1988-May 1991): (1) a database of New York insurance companies' rating…
Are hemodialysis kidney machines and their single-use disposable supplies exempt from New York sales tax, and as what kind of exempt item?
Exempt as medical equipment — with a carve-out. Althin CD Medical's hemodialysis kidney machines and the single-use disposable supplies (needles, tubing, filters) used with them are medical…
Did a company that stored and handled airline cargo and passenger baggage qualify as an airline for Florida's exemption from tax on certain airport real-property rentals?
No. The company provided ground-handling services under contracts with airlines but did not itself operate as an airline. Using the ordinary meaning of 'airline,' the Department found that the…
Historically, did Florida treat rent used to amortize mortgage debt as nontaxable debt payment when a corporate tenant was the property-owning partnership's sole general partner and equally liable on the debt?
This obsolete TAA said yes, but only to the amount legally necessary to amortize debt on which the partnership and corporate general partner were equally liable. The official source says the ruling…
Was a charge for sending a photographic image through a remote electronic wire service subject to California sales tax?
No, under the letter's narrow historical definition. It treated a photographic-image transmission from premises other than the receiver's as no transfer of tangible personal property. The source…
Was a charge for sending a photograph through a remote electronic wire service taxable?
No. California said the remotely transmitted photographic image was not tangible personal property when sent from premises other than the receiver's.
How did Texas tax unprocessed aggregate and equipment-with-operator charges used in taxable, construction, residential, or nontaxable services?
Unprocessed sand, gravel, dirt, and soil were nontaxable unless included in a taxable service. Equipment-and-operator charges followed the service when combined. For a nontaxable service, separate…
Were county fees charged to private vendors for concession zones or roving operations on public beaches taxable as licenses to use real property?
Yes. The county ordinance called the arrangement a concession license, and the vendors received a privilege to use beach property to sell goods, refreshments, rentals, and recreational services. The…
Did the original 1991 Florida TAA exempt coronary balloon catheters as prosthetic or orthopedic appliances?
No. Based on advice from the Department of Health and Rehabilitative Services, the original TAA found that the catheter was not a prosthetic or orthopedic appliance and its Florida sale was taxable.…
Was a disabled buyer entitled to a Florida sales-tax refund for a specially selected van and factory options required before wheelchair-lift and hand-control modifications?
No. The van and its standard or manufacturer/dealer optional equipment remained taxable even though vocational rehabilitation and an evaluator required those specifications. Only separately stated…
Was a self-insured lessee's payment to a lessor after a long-term commercial vehicle was stolen or destroyed subject to Florida sales tax when the lessor had paid tax when buying the vehicle?
No. The lessor had paid Florida tax on acquiring the commercial vehicle, so the initial lease and renewals to the same lessee were not subject to rental tax. A payment required under that…
Could an automobile broker claim a tax-paid resale deduction when a dealer charged tax on a vehicle bought for prompt resale?
Yes, if the broker resold the vehicle without disqualifying use. It remained responsible for tax on the customer sale and deducted its dealer purchase price.
Was complimentary valet parking hired by a club, individual, or event group subject to Texas sales tax when guests paid no parking fee?
Yes. The service remained taxable motor-vehicle parking whether the hiring group paid the hourly fee or the vehicle owner paid directly. Operating temporarily on client property, owning no parking…
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