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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When is South Carolina's 2018 sales tax holiday and what items are exempt (per SC IL #18-5)?
South Carolina's 2018 sales tax holiday runs from 12:01 a.m. Friday, August 3, 2018 through midnight Sunday, August 5, 2018. During that three-day weekend, the 6% state sales and use tax and any appli…
What is South Carolina's most recent statewide per capita income figure used for tax incentive eligibility (per SC IL #18-6)?
South Carolina's most recently available statewide per capita income figure is $40,421, per SC Information Letter #18-6. This matters because a number of South Carolina income, sales-and-use, and prop…
What does Illinois Private Letter Ruling ST 18-0005-PLR conclude about Local Taxes?
Yes: the Illinois Department of Revenue ruled that the taxpayer's commercial fuel-marketing unit was engaged in the business of selling in the city where its sales office was located, because three of…
Can a Georgia copy shop buy or lease self-service copiers tax-free for resale or claim the manufacturing-equipment exemption?
No. Charging customers per copy did not transfer possession or control of the copier, so the copy shop was not leasing or reselling the equipment and had to pay tax on it. Copy shops also did not qual…
When a restaurant buys dressing mix, compounds it into a condiment, and sells it to customers, is the purchase of the mix taxable and the sale of the condiment taxable?
It turns on whether the condiment is separately priced. If a restaurant just makes a condiment available (no separate charge), the restaurant is the user/consumer — like napkins or utensils — and pays…
When a company sells and installs a commercial sign, are its separately stated charges for surveying, engineering stamps, and permits included in the sales tax on the sign?
It depends on what the charge is really for. A sign is taxable tangible personal property, and a retailer's costs of bringing goods to market — government permits, engineering drawings, manufacturing …
How does South Carolina calculate sales or use tax on a qualifying fire truck and the firefighting equipment sold with it?
A qualifying fire truck is taxed at 5% of its sales price or $500, whichever is less. Non-clothing firefighting equipment shares that cap only when it is supplied with the truck by the same vendor and…
Did a military spouse become a Virginia domiciliary by buying a home and obtaining a Virginia driver's license?
No. Despite a Virginia home, vehicles, and driver's license, the taxpayer retained strong ties to the service member's State A domicile, including a home and active voting there. Virginia found no com…
Did a temporary move and job in another state end a taxpayer's Virginia domicile?
No. The taxpayer described the other-state residence as temporary and Virginia as her permanent home, while keeping a Virginia license and voter registration. Virginia treated her as a 2014 domiciliar…
Could a corporation use alternative records to support cost-of-performance changes to its Virginia sales factor?
Potentially. Virginia said no single document proves cost of performance for every business, so the corporation could submit alternative records and explain its methods. Refunds would be issued only t…
Which tier of pass-through entities had to report and pay Virginia nonresident-owner withholding?
The upper-tier LLC, trust, and estate—not the lower-tier taxpayer—were responsible for Virginia pass-through withholding and Form 502 filings. The LLC lacked proof of a hardship waiver, and the trust …
Could taxpayers subtract an entire prior-year federal NOL directly from Virginia adjusted gross income?
No. The taxpayers could not subtract the entire federal NOL and drive Virginia adjusted gross income below zero. But part of the 2009 loss could still be deductible after Virginia fixed-date-conformit…
How did Virginia tax restricted stock units earned partly from services performed in Virginia?
Virginia taxed the service-related portion of RSU income when the units vested, using a ratio of Virginia service days to total service days. Any later gain after vesting was investment income and was…
Could a corporation's president avoid converted tax assessments by saying she was only an investor?
No. The president provided no evidence that she lacked knowledge of the unpaid taxes or authority to prevent the failure. Because the assessments were presumed correct and she did not meet her burden …
Did solar-panel mounting, racking, and certified pollution-control property qualify for Virginia sales-tax exemptions?
Yes, in part. Mounting and racking integral to the solar tracking system qualified for the manufacturing exemption, but concrete foundations did not. Items certified by DMME qualified under the pollut…
Did vendor correspondence prove that software and maintenance were delivered only electronically and qualified for Virginia's exemption?
No. Later vendor correspondence identifying the purchase order did not satisfy Virginia's documentation rule. The invoice, contract, or sales agreement had to certify electronic delivery and that no t…
When does South Carolina use tax apply to purchases from Internet, catalog, auction-site, or out-of-state sellers, and how is it reported?
South Carolina use tax generally applies when taxable property is bought at retail for use, storage, or consumption in the state and South Carolina sales tax was not fully collected. Credit may be ava…
How did South Carolina's Utility License Fee Credit work under the rules summarized in RR 18-8?
Under RR 18-8, a company subject to the § 12-20-100 Utility License Fee could claim a nonrefundable credit equal to cash paid for qualifying infrastructure benefiting an eligible project. The annual c…
Under South Carolina's 2018 rules, how were boats, boat motors, and boat trailers taxed when sold alone or together by a retailer or private seller?
This historical ruling separated each item and seller type: boats were maximum-tax items; unattached boat motors were taxed at the full rate; and trailer treatment depended on retailer status and pers…
When can a South Carolina purchaser age 85 or older receive the one-percentage-point reduction in the state sales, use, or casual excise tax rate?
A purchaser age 85 or older receives the one-percentage-point state tax reduction only when the individual personally buys an item for personal use, requests the reduction at the time of sale, and pro…
Could Virginia tax a 2016 retirement distribution received after the taxpayer moved abroad and abandoned Virginia domicile?
No. The taxpayer had sufficiently abandoned Virginia domicile and established domicile in Country A before 2016. Federal law barred Virginia from taxing the retirement distribution received as a nonre…
Did financial disability or a timely estimated payment extend Virginia's deadline for a 2012 refund?
No. Virginia said federal financial-disability tolling did not alter its refund limitation period, and making a timely estimated payment did not preserve a refund claimed on a late return. The prior d…
Did military orders prevent a service member and retired spouse from becoming Virginia domiciliaries?
No. Military orders alone do not change domicile, but voluntary actions can. Based on the available record, Virginia found the retired spouse had established Virginia domicile and the service member h…
Could Virginia base a withholding assessment solely on another agency's worker-classification information?
No. Virginia could lawfully obtain VEC information, but the auditor still had to independently apply the employee-versus-contractor factors to the company's records. The case returned for a full revie…
Which services sold with audiovisual systems were taxable, and could the audit sample be revised?
Virginia exempted actual repair and installation labor, but taxed project management, bundled GUI work, training, and a sound-system rental with only a standby technician. Custom programming and netwo…
Was a business manager personally liable for the corporation's unpaid Virginia sales tax as a responsible officer?
Yes. Virginia found that the manager's authority over the company's financial affairs created a duty to ensure sales-tax filing and payment absent proof of delegation. He also failed to disprove knowl…
Is a truck rental to a contractor exempt if the contractor gives a Contractor Exempt Purchase Certificate (ST-120.1) with box A checked?
No — the rental is taxable. Renting a truck is a taxable sale of tangible personal property. The contractor used the truck to haul dirt on and off site, so the truck is equipment the contractor used t…
Are service fees earned by a Florida company from a foreign related customer sourced to Florida?
No on these facts. The Department treated the customer's purchase as the income-producing activity and sourced the fees to the customer's physical location. Because the related customer was outside Fl…
Could a government contractor buy communications equipment tax-free before shipping it abroad for installation on a naval ship?
Yes, under the resale exemption—not the temporary-storage exemption. The contract's true object was selling communications equipment to the federal government, so qualifying purchases could be made wi…
Could JTC deduct receipts from coating and blasting services without valid New Mexico nontaxable transaction certificates?
Mostly no. JTC performed coating and blasting services but lacked valid New Mexico NTTCs from Mid Columbia Engineering, ABQ Manufacturing, and other buyers. An incomplete Washington resale certificate…
Could an assisted-living facility calculate its deductible real-property rent by subtracting service costs from bundled resident charges without proving fair rental value?
No. SSC was entitled to deduct receipts attributable to leasing real property, but it had to use a reasonable method to separate rent from taxable assisted-living services. SSC subtracted its costs fo…
What happened after Shaun Holguin supplied records that caused the Department to abate his 2010 personal income tax assessment without telling the AHO?
The amended decision held that Holguin owed none of the assessed $1,164 tax, $232.80 penalty, or $246.66 interest. After the hearing, he timely supplied the records the Department requested, and the D…
Does a mid-term termination-fee option in a 28-year charter-school ground lease defeat the exempt improvement-to-realty contract test, if the property reverts to the school on termination?
Yes, still exempt. The Comptroller ruled that a charter school's 28-year Ground Lease/Lease IS an exempt contract under Section 151.311, even though it includes an option to terminate (for a fee) betw…
Can a landlord buy construction materials tax-free for a charter-school campus while it's still under construction, under a 25-year lease that hasn't started yet?
Yes. The Comptroller ruled that the charter school's 25-year lease IS an exempt contract under Section 151.311 -- even though construction hadn't reached Substantial Completion and the lease term itse…
Is a charter school's 25-year lease financing a student-housing apartment complex for international students an exempt improvement-to-realty contract?
Yes. The Comptroller ruled that a charter school's 25-year lease financing a new student-housing apartment complex -- built for international students in its Mandarin-immersion program -- IS an exempt…
Is a charter school's 25-year build-to-suit campus lease an exempt improvement-to-realty contract that lets the landlord buy construction materials tax-free?
Yes. The Comptroller ruled that the charter school's 25-year lease IS an exempt contract under Section 151.311, because a 25-year term is sufficiently long relative to the campus's 22-year useful life…
Could a deceased taxpayer's successor receive a 2013 Virginia refund claimed after the three-year deadline?
No. The 2013 return had to be filed by May 1, 2017, to claim a refund, but the successor filed it on November 13, 2017. Virginia said it had no discretion to waive the expired three-year limitation pe…
Were grocery personal-shopping fees, item surcharges, and home-delivery charges taxable in Virginia?
Personal-shopping fees and item surcharges followed the tax treatment of the groceries or other items sold because the true object was obtaining the goods. A separately stated home-delivery charge was…
Are the parts and the machinery a company buys to build an experimental aircraft prototype for its own research and development exempt from Colorado sales and use tax?
Mostly exempt. The parts a company buys and builds into an experimental aircraft prototype for its own R&D are exempt from Colorado sales and use tax — not under the 'components for resale' exemption …
Was a dissolving steroid-releasing sinus implant exempt as medical equipment, a prosthetic device, or medicine?
Generally no. The single-use physician-implanted product was not durable medical equipment, did not replace a missing body function, and was classified as a medical device rather than medicine. Sales …
Did a military spouse prove that she retained the service member's other-state domicile?
No. The spouse established substantial Virginia ties and did not show resident returns or other sufficient connections to the service member's claimed home state. Virginia upheld the assessments, whil…
Could a taxpayer claim Virginia's retirement subtraction without records showing which pension contributions another state taxed?
No. The taxpayer had to prove that pension contributions were deductible or excluded federally but added back and taxed by another state. Difficulty obtaining decades-old records did not satisfy that …
Should gross receipts from product sales between members of a Florida consolidated group be included in the sales factor?
Yes on these facts. The intercompany transactions involved transfer of title, consideration, actual delivery, an identifiable sales destination, and gross profit recorded in separate affiliate account…
Was BPOL a net-income tax excluded from the Internet Tax Freedom Act's internet-access protection?
No. Virginia said BPOL taxes gross receipts without deductions and is not a net-income tax excluded from the federal Act. Even so, the Department declined to decide whether the city's tax was grandfat…
Did Virginia order a county to refund BPOL tax on internet-access receipts under federal preemption?
No. Virginia said federal law may be judged by a tax's operation and effect and had previously applied the Internet Tax Freedom Act to BPOL. But it declined to decide the disputed grandfather-status q…
Did Virginia order a city to refund BPOL tax on internet-access receipts under the Internet Tax Freedom Act?
No. Virginia recognized that the Internet Tax Freedom Act could apply to BPOL tax, but declined to decide the disputed factual question whether the city was grandfathered. Without an order for correct…
Did Virginia order BPOL refunds after rejecting a city's narrow reading of the Internet Tax Freedom Act?
No. Virginia maintained that the Internet Tax Freedom Act was not limited to transactional taxes and could reach BPOL. But it declined to decide the city's disputed grandfather status, so the local re…
Did a sole S-corporation shareholder who received a W-2 count as an employee for Virginia's 2016 telework credit?
Yes. The 100% shareholder performed services for the S corporation, received compensation and a W-2, and was treated as the corporation's employee rather than an ineligible self-employed person. Virgi…
Were converted restaurant sales-tax assessments removed after zero returns showed the business was inactive?
Yes. After the restaurant filed returns showing no income for the assessed periods, Virginia reversed the business assessments, discharged the converted assessments against the former owner, and close…
If a Tennessee restaurant puts pay-to-use entertainment tablets on its tables, does it owe the coin-operated amusement machine tax, and is the premium-content fee — or the rental it pays for the tablets — subject to sales tax?
Three answers. (1) The tabletop tablets are NOT subject to Tennessee's coin-operated amusement machine tax: a machine only counts if it delivers amusement upon depositing a coin, token, or object up f…
When did a taxpayer become a Virginia resident if domicile changed in May but he spent more than 183 days here?
Virginia found the taxpayer changed domicile in May 2015, but his taxable period began March 8. Because he spent more than 183 days in Virginia during 2015, he was an actual resident from his first Vi…
Were Virginia's corrections to 2014 and 2015 income tax returns untimely because the errors were not found sooner?
No. Virginia notified the taxpayers of the corrections in August 2017, within the three-year assessment period for both returns. The tax and interest remained due, and interest could not be waived unl…
Did living in Pennsylvania and working in Delaware end a taxpayer's Virginia domicile for 2013?
No. The taxpayer kept a Virginia license, vehicle registration, voter registration, and prior home while showing little evidence of a permanent Pennsylvania domicile. Virginia taxed him as a resident …
Is an equipment lease with an end-of-term purchase option at fair market value subject to Florida documentary stamp tax?
No. Because the lessee could return the equipment or buy it only at no less than its end-of-term fair market value, the agreement was a true lease rather than a taxable written obligation to purchase.
Did a Florida food hall's agreement with independent restaurant vendors create a taxable license to use real property?
Yes. Although the agreement denied creating a lease, independent vendors operated their businesses on the food hall's premises. The sales proceeds retained by the food-hall operator were taxable consi…
Are labor-only inspections and repairs of fire alarms, sprinklers, and extinguishers subject to Florida sales tax?
Fire-alarm inspection and repair labor was taxable. Labor-only sprinkler and extinguisher work was not taxable when separate from the alarm system, but extinguisher work became taxable if parts were a…
Did buying a Virginia retirement home and obtaining a Virginia license establish domicile while the taxpayer worked abroad?
No. The taxpayer showed future intent to live in Virginia but was present only for brief vacations while working abroad. Because domicile requires intent and physical presence together, Virginia found…
Did the Internet Tax Freedom Act require Virginia to cancel a city's 2016 BPOL assessment on internet-access receipts?
No correction was ordered. The Department reiterated that the Internet Tax Freedom Act can apply to BPOL tax and that BPOL is not a tax on net income, but it declined to decide the disputed question w…
Were conveyor bottoms and hangers exempt repair parts for coal-mining equipment?
Yes. The bottoms and hangers were integral repair or replacement parts for an exempt mining conveyor, not taxable structural supports fixed to realty. Virginia accepted the customer's late Form ST-11 …
Which mining and manufacturing audit items were exempt, taxable, or sent back for verification?
Virginia reached a mixed result. Direct production parts and certain repair labor were removed; water-truck parts, maintenance tools, and post-production testing stayed taxable. Several lubricants, pa…
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