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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Were charges for balancing and changing the stroke of an oilfield pumping unit subject to Texas sales tax?
Yes. Texas treated an oilfield pumping unit as tangible personal property and classified balancing and bore-stroke modification as taxable remodeling, making the entire charge taxable.
Are ophthalmic (eye) surgical suture materials exempt from New York sales tax as prosthetic aids or as drugs/medical supplies?
Exempt as medical supplies under Tax Law § 1115(a)(3), not as prosthetic aids under § 1115(a)(4). Alcon's ophthalmic sutures (silk, dacron/nylon, polypropylene, polyester) are used to close surgical…
Is a company that copies and sells certified hospital medical records selling taxable tangible personal property or an exempt service?
Taxable. A company copied certified hospital medical records and sold the copies to attorneys, insurers, peer-review organizations, government agencies, and individuals. DRS ruled this is a taxable…
Was an extended warranty for repairs to a residential heating and air-conditioning system subject to Texas sales tax?
No. Texas said the residential real-property repair warranty and repair labor were not taxable, while the warrantor or third-party repairer owed tax on the applicable parts, supplies, materials, and…
Was an approximately $50 fee to use a Galveston bungee-jump concession subject to Texas sales tax?
Yes. The Comptroller treated the per-jump charge as a taxable admission to an amusement service, comparable to taxable admission fees for a golf course or tennis court.
Were an investigator's unarmed process-serving and document-delivery charges taxable Texas security services?
No. The Comptroller treated unarmed service of subpoenas and legal notices and unarmed document delivery as nontaxable unrelated services because the work did not require a private-investigator or…
Were trucks owned by a commonly owned corporation treated as the separate sole-proprietor material retailer's own delivery facilities?
No, assuming the businesses were genuinely separate and the corporation acted as common carrier or independent contractor; common ownership alone did not merge their facilities.
Could a Texas rental or leasing company use vehicles retired more than 18 months earlier for the fair-market-value deduction?
No. The agency applied an 18-month policy requiring the retired vehicle to be offered for sale and claimed against a replacement purchase within 18 months. The appended internal memo acknowledged…
Were the Texas Workers' Compensation Commission's charges for medical fee guidelines, blank forms, rules, and agenda packets subject to sales tax?
No. The Comptroller treated those governmental publications and documents as exempt. STAR now warns that the cited Rule 3.341 was repealed in 2008 and its content moved to Rule 3.322(h)(5) in 2011.
How did Texas tax telecopy, telex, translation, and person-delivered voice-message services between Texas and the Soviet Union?
Translation and person-delivered message charges were not taxable. Long-distance telecopy and telex charges were taxable only when the service originated in Texas and was billed to a Texas telephone…
If the Tax Department issues a tax levy against 'Mr. X individually and as an officer of ABC, Inc.' for the corporation's unpaid taxes, can the bank apply the levy against the corporation's own bank account, or only against Mr. X's personal account?
Only the individual's account. ABC, Inc. failed to pay sales taxes it owed, so the Commissioner issued a tax warrant and then a tax levy naming 'Mr. X individually and as an officer of ABC, Inc.'…
Did an absolute mortgage assignment and same-borrower renewal owe additional Florida documentary stamp or nonrecurring intangible tax?
No on the stated conditions. The absolute assignment was exempt because it was not collateral for a new loan and the original obligation had been taxed. The renewal also was exempt because the same…
Did a special-order form with a nonrefundable deposit qualify as a fixed-price contract exempt from California's July 1991 rate increase?
Yes for orders executed before July 15, 1991. The form fixed the tax amount, imposed a deposit forfeiture rather than unconditional cancellation, and did not allow tax changes.
Were customer damage repairs, equipment inspections, and freight charges connected with sold or rented equipment taxable in Texas?
Repair services and parts billed to a customer for damaged rental equipment were taxable; inspection-only charges were not. Freight on equipment sold or rented to customers was taxable whether…
Was a charge for underground-storage-tank vapor analysis and a confidential leak-detection report subject to Texas sales tax?
No. The report and sample-analysis charge was not taxable, but the provider had to pay sales tax on the tubes, equipment, and other tangible property used to perform the service.
Could an elevator maintenance contract tax only the percentage allocated to repairs and exclude scheduled maintenance and inspection?
Yes. Texas accepted a 72% nontaxable maintenance-and-inspection and 28% taxable repair allocation if credible job-history evidence supported it and both contracting parties agreed, with state and…
Was a $25 introductory airplane flight taxable as instruction or as an amusement service?
It depended on the flight. A documented flight conducted as part of an FAA Part 61 or Part 141 instruction course was not taxable; a noninstructional sightseeing or enjoyment flight returning the…
Are on-line financial news services delivered to subscribers on computer screens exempt newspapers or periodicals, or a taxable information service?
Taxable information service, not an exempt newspaper or periodical. The petitioner's client published four on-line financial newsletters delivered to subscribers as text on computer screens (via…
Would Maryland residents owe Florida use tax when bringing a new boat into Florida for limited personal use without Florida property or business contacts?
No on the stated conditions. The boat would not be titled in Florida, stay 90 consecutive days, exceed 183 aggregate days in 12 months, be offered for charter or sale, or be used in business, and…
Were construction materials for a Florida tax district's replacement hospital exempt when the district bought them directly under its construction contract?
Yes. The tax district—not the prime contractor—executed purchase orders, took title at delivery, bore pre-installation risk and builder's-risk insurance, received vendor invoices, paid vendors…
Could a charitable nursing-home owner buy construction materials tax-free through a contractor agency agreement for a replacement facility?
Yes, if the owner was the actual purchaser: vendors invoiced it directly, it paid vendors directly, purchase orders and bids named it as purchaser, title passed directly to it, and it bore the…
Could a Florida HVAC contractor compute use tax as 6% of half its contract billings, buy fabrication materials for resale, and wait until final acceptance to remit?
The contractor could elect the 6%-of-50% method and buy incorporated fabrication materials with valid resale certificates. But tax was due on 50% of each customer billing, less lawful deductions,…
Did an out-of-state software developer have to collect Florida tax on licensed prepackaged programs before it hired a Florida sales representative?
Yes under this 1991 ruling. Licensing prepackaged software on physical media transferred possession of taxable tangible personal property, and the company became a dealer when it began licensing the…
What changed when South Carolina recodified the general Tax Commission provisions in Title 12 in 1991?
Effective July 1, 1991, former Title 12 Chapters 1 and 3 were rewritten, repealed, and replaced by Chapters 2 and 4. The letter says the recodification simplified, combined, and reorganized the law…
Was leasing a permanently affixed above-ground storage tank larger than 500 barrels subject to Texas sales tax?
Generally no, because Texas treated it as real property. But the lease was taxable if its terms made clear that the tank remained tangible personal property, regardless of size.
For a railroad's charter excursions, is the transportation taxable, who pays tax on bundled event tickets, and what local rate applies to souvenirs and food sold on a moving train?
The Department answered three questions for a railroad running charter excursion trains. (1) Charter excursion fares — including tickets bundling rail transportation with admission to events like…
How did Texas tax towable dollies, jeeps, stingers, auxiliary axles, and converter gears beginning September 1, 1991?
Texas moved these items into the trailer and semitrailer definitions. In-state purchases and rentals became subject to motor vehicle tax, while units used interstate by interstate motor carriers…
Could an exempt religious college buy basic local telephone service for student rooms tax-free when included in room and board?
No. The service did not relate to the college's exempt purpose. The college could pay tax and include it in room rent, or buy for resale, separately charge students, and collect tax.
How did Texas tax towable dollies, jeeps, stingers, auxiliary axles, and converter gears beginning September 1, 1991?
Texas moved them into the trailer and semitrailer definitions, subjecting in-state purchases and rentals to motor vehicle tax and interstate-carrier units to IMC tax instead of limited sales tax.
Did a federal agency acting as receiver for failed banks have to collect Florida sales tax when selling the banks' tangible personal property?
Yes. The agency was a statutory person and receiver engaged in business through its recurring public-benefit asset sales. Florida's tax legally fell on the purchaser, so requiring the agency to…
Could a Texas purchaser use wholly electronic purchase orders to claim resale, exemption, or direct-payment treatment?
Not by themselves. A traditional signed resale or exemption certificate had to remain on file with the seller; later written or electronic purchase orders could claim the exemption by referring to…
Could a mail-order retailer use fixed shipping-and-handling amounts and pay tax only on the monthly excess over its total UPS bill?
No. The combined fixed charges exceeded actual freight and were taxable; any exclusion required transaction-level actual-cost records and could not exceed each shipment's cost.
When were underground tanks, pumps, and canopies taxable in a sale of an operating gasoline station?
For an owner-seller, tanks and canopies were taxable only if the seller would sever them, while pumps were taxable if either side planned removal. A lessee-seller's removable trade-fixture pumps…
What documents could a Texas purchaser use to prove that multiple items were exported to its Mexican maquiladora?
Texas required specific export proof. The letter identified U.S. Customs certifications, a Mexican Pedimento de Importaciones with detailed supporting manifests or invoices, and a properly completed…
Were medical case-management and rehabilitation-consulting services supplied to insurance companies taxable in Texas?
Yes. The provider's calls, meetings, medical and vocational assessments, appointment coordination, reports, and recommendations qualified as insurance investigation and claims adjustment or…
When did a crude-oil operator have to report and remit severance tax as oil moved from a lease into a pipeline or storage facility?
The operator had to remit tax on oil removed from the lease and report itself as purchaser. Oil piped only to on-lease storage was not reported until it left the lease, but commingled oil from…
When a home-party hostess redeems earned credits for a direct-sales company's merchandise, is that a taxable sale even though no cash changes hands?
Yes, it is a taxable sale. Petra Fashions ran home merchandise parties and, as an incentive to host, gave hostesses credits redeemable only for its own line of merchandise. The Department held that…
Can a New York vendor keep computer-readable tapes instead of paper cash-register tapes to satisfy its sales tax recordkeeping duties?
Yes. A vendor may keep computer-readable tapes as an alternative to paper cash-register tapes to satisfy its sales tax recordkeeping duties under Tax Law § 1135(a)(1) and 20 NYCRR § 533.2(f)(1),…
Did Texas-based independent salespeople require an out-of-state seller to collect tax, and what resale or exemption documents could the seller accept?
Yes. Commissioned independent salespeople created Texas business activity, requiring a permit and tax collection or valid certificates. A permit copy was not a certificate; Texas required separate…
Could a taxable security-service provider buy customer-controlled equipment for resale when the customer could keep it free or buy it for $1 after the contract?
Yes. Under the 1991 letter, equipment transferred to the customer's care, custody, and control as an integral part of taxable security service could be bought with a resale certificate under either…
How did Texas sales tax apply when a contractor filed a damaged-freight claim and transferred the damaged item to the carrier?
Treatment depended on whether the contractor was a seller or consumer. A seller generally excluded tax from the claim if the carrier resold the item. A consumer included previously paid tax in the…
Could a property manager make tax-free purchases for assets held in FDIC receivership without registering as an FDIC agent?
Yes, registration with the Comptroller was unnecessary, but the manager needed a written FDIC agency agreement and proof that FDIC held title to the property. With those records, the manager could…
What documentation could a service provider accept before stopping sales-tax collection from a manager acting for the RTC?
A completed, signed exemption certificate was enough to protect the service provider if accepted in good faith. The manager could sign as RTC's agent and assert the agency relationship; the manager,…
Did a customer still owe sales tax on catalog jewelry that was returned but lost in transit before the retailer received it?
Yes. A sale occurred between the customer and the retailer, and the lost return shipment did not erase the tax debt. Under Texas Tax Code § 151.052(a)(1), sales tax was part of the sales price and…
Were a sports league's team entry fees and $10 player passes taxable as amusement services or sales of tangible personal property?
No. The $400 team charge was a nontaxable entry fee under Rule 3.298(c), and the $10 pass bought association membership and participation rights—not property or admission to an amusement. The…
Were separately billed charges for extra chemical-toilet servicing included in taxable rent?
No. Weekly included service was taxable rent, but separately stated extra visits requested by the customer were optional and excluded.
When did the 1991 memorandum say an out-of-state newspaper or periodical publisher had to collect California use tax?
A California news bureau was enough. The memorandum also identified in-state subscription solicitors, certain recurring mail solicitation with local benefits, and common ownership as other possible…
Was sales tax due up front on all payments under a financing lease even if the lease was later terminated and the equipment sold?
Yes. The contract was a financing lease, so tax applied to the full sales price—including all lease payments—when possession began or the first payment came due, whichever was earlier. Termination,…
Did a nonprofit trade association have to collect Texas sales tax on correspondence-course tuition or the course binder, test, and certificate?
Tuition or enrollment was not taxable. A separately stated materials charge—including shipping and handling—was taxable, and the association could buy participant materials for resale. If materials…
Did a dental laboratory making custom dentures, artificial teeth, and orthodontic appliances qualify for Utah's manufacturing machinery-and-equipment exemption?
No. The Commission classified a dental laboratory making dentures, artificial teeth, and orthodontic appliances to order under SIC 8072, which was not a manufacturing SIC code. SIC 3843 covered…
Was the Dallas/Fort Worth International Airport Facility Improvement Corporation exempt from Texas sales tax as a political subdivision?
No. After reviewing its articles of incorporation, the Comptroller concluded that FIC was not a political subdivision and denied the sales-tax exemption. The corporation could reapply if it later…
Did SC Revenue Ruling 91-11 allow bingo players to cover every even or odd number, or every number sharing a drawn ball's final digit?
No. A single randomly selected ball could not authorize players to cover every number with the same ending digit, and a random selection could not authorize covering every even or odd number. The…
Was a Texas seller still responsible for sales tax when its customer refused both to pay $288.83 in tax and to provide a resale certificate?
Yes. The seller had to collect and remit the tax. Under § 151.052, tax became part of the sales price and a legally recoverable debt owed by the purchaser. The seller could also correct an invoice…
My corporation and two related partnerships (with overlapping but not identical family ownership) plan to swap parcels of undeveloped land, with cash making up any difference in value. Does this land swap trigger New York's Real Property Transfer Gains Tax, and does the mere-change-of-identity exemption help since the same family owns pieces of all three entities?
The exchange is a taxable transfer on both sides (each party is a transferor of what it gives up), but each side gets a PARTIAL mere-change-of-identity exemption to the extent the exchange doesn't…
Did a mill operator owe Florida sales or use tax on charges and steam from a cogeneration provider heating the operator's own water?
No. The provider's charge was for an exempt service because the mill operator owned the water and steam throughout and no tangible property was sold. The same payment was not subject to use tax, and…
Could a Florida city buy pipe and valves tax-free for sewer force mains when its prime contractor selected suppliers and scheduled delivery?
Yes. The city contracted directly with the vendors, issued its own purchase orders, took title at delivery, was self-insured and bore pre-installation risk of loss, and paid vendors directly. The…
Was a cogeneration partnership's charge for heating a mill operator's water into steam subject to Florida sales tax?
No. The mill operator owned the water and resulting steam throughout the process, and the partnership only heated and returned that property without separately charging for parts, materials, or…
Did machinery for a coal-fired cogeneration plant qualify for Florida's electrical- and steam-energy production exemption?
Yes for machinery necessary to the integrated plant's production of electricity and steam at the fixed location, because about 90% of plant revenue was expected from selling electricity—above the…
Could a contractor's pre-July 15, 1991 irrevocable bid qualify as a fixed-price contract when accepted after the cutoff?
Yes, if the bid became irrevocable before the cutoff and was accepted before it became revocable, even when acceptance occurred afterward.
Was an optional software-maintenance policy taxable when it bundled telephone consultation with canned updates on magnetic tape?
Yes when updates were delivered. The tapes were taxable property, and required consultation was part of the sale, so the entire bundled charge was taxable.
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