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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Does a Connecticut store have to charge sales tax on bottled kombucha, or is it exempt as a food product?
No — kombucha is not exempt; it is taxable. Because kombucha is a carbonated beverage, it is excluded from Connecticut's sales-tax exemption for food products for human consumption under Conn. Gen. St…
If the federal Internet Tax Freedom Act moratorium expires, will Kansas start taxing internet access charges?
No. Kansas does not tax internet access charges regardless of the federal Internet Tax Freedom Act (ITFA), because Kansas sales tax reaches only 'telecommunication service' and K.S.A. 79-3602(aaa)(6) …
Does a Georgia structural contractor owe use tax on materials fabricated in Georgia for out-of-state erection contracts, and can it recover tax if materials are later sold at retail?
Yes. A contractor owed Georgia sales or use tax on materials delivered to, stored at, or fabricated in its Georgia facility even when later installed into real property outside Georgia. The contractor…
Does Georgia's hotel-motel fee apply when commonly owned rental units are spread among separate buildings with fewer than five units each?
No. The property was made up of separate buildings, each with fewer than five hotel rooms. A connecting open stairwell and roof addition did not make them one building, so neither the overall property…
Can a taxpayer that already claimed Georgia's jobs tax credit for certain jobs later amend its return to claim the quality jobs tax credit using those same jobs?
No. A taxpayer can claim both the jobs tax credit and the quality jobs tax credit, but not for the same jobs. The choice of which credit applies to a given job is made when the taxpayer first claims e…
Can a taxpayer use separate accounting instead of Illinois's statutory apportionment formula just because separate accounting produces a lower or different tax liability?
No. Just like the near-identical companion ruling IT 15-0012-GIL, the Department denied this petition: a taxpayer cannot get permission to use separate accounting merely because it produces a differen…
Can a taxpayer use separate accounting instead of Illinois's statutory apportionment formula just because separate accounting produces a lower or different tax liability?
No. Just like the near-identical companion ruling IT 15-0012-GIL, the Department denied this petition: a taxpayer cannot get permission to use separate accounting merely because it produces a differen…
Can a taxpayer use separate accounting instead of Illinois's statutory apportionment formula just because separate accounting produces a lower or different tax liability?
No. The Department denied the petition: a taxpayer cannot get permission to use separate accounting merely because it produces a different (or more favorable) result than the statutory apportionment f…
Was documentary stamp tax underpaid on a recorded mortgage that allowed unpaid principal to grow to 115% of the original loan amount?
Yes. Documentary stamp tax was due on the maximum debt secured—115% of the original principal—so the recorded mortgage was underpaid. Either borrower or lender remained liable, with interest.
Was a prescription-only, single-use permanent urological implant system sold to hospitals and medical facilities exempt from Florida sales tax?
Yes. The prescription-only urological implant system was a medical device intended for one patient and not reusable, so sales to hospitals and medical facilities were exempt. The seller had to retain …
Were services previously found outside Illinois telecommunications excise tax subject to Retailers' Occupation, Use, or Service Occupation Tax?
Not if the services transferred no tangible personal property. IDOR declined a supplemental PLR but explained that pure services were outside Retailers' Occupation and Use Tax, and Service Occupation …
What is South Carolina's tax interest rate for underpayments and overpayments for the period ending December 31, 2015 (per SC IL #15-13)?
3%. SC Information Letter #15-13 sets South Carolina's interest rate on tax underpayments and overpayments at 3% for the period October 1, 2011 through December 31, 2015. Interest is compounded daily,…
When are Kansas sellers relieved of liability for wrong tax charged because of an error in the state's taxability matrix?
Kansas Notice 15-13 (originally dated July 10, 2015, revised September 14, 2015, and replacing Notice 14-01) sets the Department's policy on taxability-matrix liability relief under K.S.A. 2014 Supp. …
Could an automobile dealership buy gasoline for resale when it filled new vehicles before delivery to customers?
Only to the extent it could prove the gasoline was actually resold. For a bulk tank, the dealer had to allocate resale versus dealership use, issue a resale certificate only for the resale percentage,…
When do customer sites become definite places of business for situsing an IT provider's Virginia BPOL receipts?
Customer sites may become definite places of business when employees work there regularly and continuously for at least 30 days, potentially requiring local licenses and receipt situs there. If the cu…
Could an independent hunting guide deduct payments with an NTTC executed after the 60-day audit deadline when a Department employee failed to respond before time expired?
The deduction failed, but penalty was abated. Burton Buchan was an independent hunting guide, not the outfitter's employee. Flat Landers did not obtain an NTTC by the April 1, 2015 deadline, and the l…
Does a rewards-program operator owe Georgia tax on the tokens it sells to businesses, and on the machines, prizes, and tokens it buys out of state?
The token 'sales' are not taxable, but the out-of-state purchases are. The Department treats the rewards program as a nontaxable service, so the operator does not collect sales tax on the tokens it pr…
Does Georgia tax medical-record copies, electronic delivery, online database access, and related postage charges?
Tangible medical records, including paper or disc copies, were taxable, and postage or handling was taxable with them. Records delivered solely by fax or emailed PDF and charges for online database ac…
Are charges for medical coding, healthcare training and education, and medical-record abstraction subject to Georgia sales tax?
No. Medical coding, training and education, and abstraction were not services specifically identified as taxable under Georgia law. The provider still had to pay sales or use tax on tangible personal …
Can a tissue-distribution business buy its surgical equipment and supplies tax-free as medical exemptions, and is the rent it charges for meeting space taxable?
Mostly taxable here. Colorado's medical-equipment and -supply exemptions apply only when the item is bought pursuant to a prescription or furnished by a licensed provider as part of professional servi…
Was pollution-control equipment exempt from 2013 local tax when it was operating by January 1 but had not yet been certified?
No. The exemption required qualifying equipment to be certified by the Department of Environmental Quality, and the equipment was not certified as of the January 1, 2013 tax day. Virginia upheld that …
Does a tax-exempt 501(c)(3) non-profit have to pay Illinois income tax or report to the Illinois Department of Revenue when it receives personal donations from Illinois residents?
No. An organization that is exempt from federal income tax and has no unrelated business taxable income is not subject to Illinois income tax, and the Department of Revenue has no role in registering …
What were the significant South Carolina tax-law changes from the 2015 legislative session, as summarized by the Department (per SC IL #15-11)?
SC Information Letter #15-11 is the Department's brief summary of the significant tax and regulatory law changes enacted in South Carolina's 2015 legislative session, organized into categories: (1) in…
Does the same 25-year build-to-suit exempt-contract analysis apply when a Texas charter school's new campus houses two combined school campuses under one lease, rather than a single campus?
Yes. In a same-day companion ruling to a single-campus version, the Comptroller reached the identical result for a charter school's 25-year build-to-suit lease covering a facility that combines TWO sc…
Does a 25-year build-to-suit lease for a Texas charter school's new high school campus qualify as an exempt contract, letting the for-profit landlord's contractors buy construction materials tax-free?
Yes. The Comptroller ruled that a build-to-suit lease under which a for-profit landlord constructs a high school campus to a tax-exempt charter school's specifications, then leases it back for 25 year…
When several co-owners jointly act as landlord under a single 25-year build-to-suit lease for a two-campus charter-school facility, does the § 151.311 construction exemption still apply?
Yes. The Comptroller ruled that a build-to-suit lease and purchase option covering two charter-school campuses, where several parties collectively act as "Landlord" under a single 25-year primary term…
When a single landlord builds one facility housing two charter-school campuses and leases it for 25 years with a purchase option limited to years one through four, does the § 151.311 construction exemption still apply?
Yes. The Comptroller ruled that a single build-to-suit lease covering two charter-school campuses built by one landlord and leased back for a 25-year primary term — with the school's purchase option l…
If a charter school already holds legal title to its land but ground-leases it to a landlord entity for construction financing, then leases back the remodeled/expanded campus, does the § 151.311 construction exemption still apply?
Yes. The Comptroller ruled that a build-to-suit lease qualifies as an EXEMPT CONTRACT under Tax Code § 151.311 even where the charter school itself holds legal title to the land but grants a ground le…
If a charter school's build-to-suit lease runs through a chain of separate holding entities (one created just to shield against environmental liability), does the § 151.311 construction-contract exemption still apply?
Yes. The Comptroller ruled that a build-to-suit lease qualifies as an EXEMPT CONTRACT under Tax Code § 151.311 even though the property sits behind two layers of separate holding entities — a non-qual…
When a charter school relocates a campus by having a for-profit landlord build a new facility and lease it back for 30 years, with an option to buy at any time, does the construction contract qualify as a tax-exempt improvement to realty?
Yes. The Comptroller ruled that a build-to-suit lease under which a for-profit landlord constructs a relocated charter-school campus to the school's specifications, then leases it back for a 30-year p…
When a landlord builds a new high-school campus for a charter school and leases it back for 25 years with a purchase option, does the construction contract qualify as tax-exempt under § 151.311?
Yes. The Comptroller ruled that a build-to-suit lease under which a landlord constructs a new high-school campus to a charter school's specifications and leases it back for a 25-year primary term (wit…
How did Illinois tax steel cable reels and customer reel deposits when the manufacturer retained or transferred ownership?
Ownership controlled. If the manufacturer transferred reel title with the cable, it could buy the reel for resale and the deposit followed the cable sale's tax treatment. If it retained title and reus…
Can a corporation subtract a refund of out-of-state taxes from its federal taxable income when computing Illinois base income?
No. Illinois law does not provide any subtraction modification for a refund of state or local taxes included in a corporation's federal taxable income, even if the refund relates to years before the c…
How did Illinois tax a motor vehicle bought by a lessor for a lease longer than one year, and who could claim a refund?
Illinois taxed the vehicle sale to the lessor at the dealer-location rate, not the long-term lease. The lessee's repayment of that cost arose from the lease contract. For qualifying post-2014 leases, …
Did Illinois Watercraft Use Tax apply to a private-party boat purchase, and could IDOR remove a late-payment penalty?
Yes, Watercraft Use Tax applied even though an ordinary occasional sale might avoid sales and use tax; that law had no occasional-sale exemption. Only the Board of Appeals could waive penalty or inter…
Did an Illinois nonprofit exemption number exempt a church from utility excise taxes, local utility taxes, fees, and bill adjustments?
No. An Illinois E number documented exemption from Use Tax on qualifying purchases made for the church's organizational purpose. It did not exempt Electricity Excise Tax, Gas Revenue Tax, or other uti…
Does a same-day checkout and check-in on day 30 restart Georgia's hotel-motel fee when the guest never stops occupying the room?
No. A same-day checkout and check-in did not interrupt continuous occupancy when the same guest remained in the room and it was never released to another customer. The rental became an extended stay o…
Were hosted customer-management, inventory, antivirus, firewall, and reporting solutions subject to Illinois sales or service tax?
They appeared to be service transactions and generally avoided Illinois retail, use, and service taxes when no tangible property or canned software was transferred. Hardcopy reports could create servi…
Could a federal real-property contractor buy freestanding office furniture for resale tax-free and recover use tax paid on it?
Yes. Freestanding furniture, fixtures, and equipment that remained unattached to the buildings could be purchased with Form ST-10 for resale and then sold tax-free to the federal agency. Virginia orde…
Why did Jacksonville, Illinois restaurants charge different sales-tax rates, and what was the 2015 rate on general merchandise?
Rates varied by item, jurisdiction, and effective date. IDOR said Jacksonville's general-merchandise rate was 7% before July 1, 2015 and 8% afterward, when a 1% County School Facility Tax was added to…
Must an Illinois caterer tax separately billed equipment, labor, setup, and delivery, and how are cleaning supplies treated?
Yes. A caterer's taxable gross receipts included food-related charges for linens, tables, chairs, dishes, flowers, labor, setup, and delivery even when separately billed. Truly separate non-food enter…
What did Illinois report in its 2015 survey response about advertising, nexus, tax rates, and local sales taxes?
IDOR declined the survey format but supplied a historical overview under 2015 law. Advertising without transferred property generally escaped retail, use, and service taxes; Illinois presence could cr…
Could a Virginia county apply the local definite place of business's payroll factor to known gross receipts from business conducted in another state when calculating the BPOL out-of-state deduction?
Yes, if the data are suitable. When actual gross receipts from business conducted in another state are available, the Virginia definite place of business's payroll factor may be applied to that amount…
How should a Virginia locality calculate the BPOL out-of-state deduction when payroll apportionment is used?
When payroll apportionment is necessary, the locality may apply the Virginia payroll factor to reliable gross receipts from business conducted in a state where the taxpayer owes an income-based tax. T…
Did a Treasury Offset Program notice restart Virginia's 90-day appeal period, and was a citizen's domestic income exempt from Virginia tax?
No. The 90-day appeal period ran from the June 2014 assessment, not the later Treasury Offset Program notice, so the April 2015 appeal was untimely. The assessment remained due, and Virginia rejected …
Could parents deduct contributions to Virginia 529 accounts when the money came from their children's irrevocable UGMA or UTMA custodial accounts?
No. Although the husband was listed as owner of the Virginia 529 accounts, the contributed money belonged to the children because it came from their irrevocable UGMA or UTMA accounts. The parents ther…
Did paying by the original due date preserve Virginia's six-month extension when the original 2010 return was filed after the extended deadline?
No. A valid extension required both timely estimated payment and filing the original return within the six-month extended period. Because the return was filed after that period, Virginia treated the e…
Could a Virginia corporation exclude wages of employees working solely overseas from its payroll-factor numerator by substituting wages subject to Virginia income-tax withholding?
Not by using withholding wages as a substitute. Wages reported to the Virginia Employment Commission were strongly presumed to belong in the Virginia payroll numerator, but the presumption was rebutta…
Did Foreign Service assignments and an intent to retire in another state end a couple's established Virginia domicile for 2010?
No. The couple established Virginia domicile before the overseas assignments, which were temporary. An intention to retire in another state and withholding there did not establish domicile without ren…
Could taxpayers who moved into Virginia in July 2011 claim itemized deductions on a full-year resident return?
They had to use a part-year return. Because the couple moved into Virginia in July 2011, they were taxable as residents only for the Virginia portion of the year and could claim itemized deductions pa…
Could Virginia extend the three-year deadline for sales-tax refunds voluntarily overpaid from February 2008 through March 2012?
No. The latest disputed period's three-year refund deadline expired before the taxpayer's May 2015 request. Virginia law authorized refunds only through a timely amended return and provided no applica…
Could Virginia estimate a grocery store and café's taxable sales from incomplete records, and did the estimate support penalty and interest?
Yes, Virginia could estimate the sales-tax liability because the grocery store and café kept incomplete records and did not prove the methodology wrong. But the estimate did not prove tax was actually…
Which of a data-center colocation provider's charges -- space, power, cabling/bandwidth, tech support -- are subject to New York sales tax?
It varies by charge. (1) Space -- charges for rack, cabinet, cage, or suite space where the customer puts its own servers and has 24/7 access are nontaxable as a lease of real property (security ID ch…
A charter school's build-to-suit lease was amended to stretch its term from 20 to 25 years shortly before the ruling request -- does that longer, amended term satisfy the § 151.311 two-prong exemption test?
Yes. The Comptroller ruled that a charter school's build-to-suit lease — which the parties AMENDED on June 12, 2015 to increase its term from 20 years to 25 years — qualifies as an EXEMPT CONTRACT und…
Did Virginia reverse the remand of BPOL and machinery-and-tools assessments when records did not show which of several entities performed each activity at one business location?
No. Virginia affirmed the remand to the city because the records did not identify which legal entity conducted each activity at the shared business location. The taxpayers had to provide enough docume…
How does Virginia BPOL tax treat a telecommunications company's data-transmission revenue, and does the long-distance-call exclusion cover electronic document exchanges or interstate local calls?
Data-transmission revenue is gross receipts whether the provider is a statutory telephone company or a business-service company, but the local BPOL situs rules differ. Electronic Data Interchange docu…
Was an HVAC distributor a BPOL retail merchant because contractors consumed many purchased parts while performing services, or was it a wholesaler?
Virginia classified the distributor as a wholesale merchant. Its contractor, government, and industrial customers bought goods for business use, the HVAC contractors likely used them in a productive p…
Could a taxpayer who moved to Virginia in March claim an out-of-state tax credit on a full-year resident return without submitting the other state's return?
Not as filed. A March mover should file Virginia Form 760PY and report only income received while a Virginia resident, attaching the other state's return to support any credit. The credit cannot cover…
Could a taxpayer who moved to Virginia in November overturn a 2011 income-tax assessment merely by saying he worked in Virginia for only two weeks?
No. The taxpayer admitted moving to Virginia in November and had Virginia-source income, but provided no objective evidence or return showing the correct 2011 liability. Virginia gave him 60 days to f…
Did one Virginia-resident co-trustee make a Pennsylvania testamentary trust a Virginia resident trust when that trustee could not act alone?
Not by itself. Because the Virginia co-trustee could act only with at least one nonresident co-trustee, that person's residency alone did not make the trust administered in Virginia if the trustee gro…
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