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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Was a microchipped medical-information bracelet taxable when furnished with nursing or data-entry services or sold by itself?
Nursing or nurse data-entry charges that included a bracelet were exempt services, not bundled retail sales, but the provider owed tax when buying the bracelet. A bracelet sold without services was ta…
What did rescinded Illinois GIL ST 14-0038 say about federal excise tax in the tobacco wholesale-price base?
Historical only—ST 14-0042-GIL rescinded this letter. ST 14-0038 had said federal tobacco excise tax was a manufacturer cost included in wholesale price for Illinois Tobacco Products Tax whether embed…
Could a one-way hauler report only loaded miles and avoid the weight-distance mileage-underreporting penalty for an honest mistake?
No. Gloworks Trucking qualified for New Mexico's reduced one-way-hauler rate, but it still had to report every mile traveled in New Mexico, including empty return miles. Reporting only loaded miles cu…
Could an Illinois school buy required books tax-free for resale and then sell them tax-free to students?
The school could buy the books tax-free for resale by giving its supplier a valid resale certificate, but its sales to students were taxable. IDOR said selling school books and supplies to students wa…
Was the requesting delivery company primarily engaged in transportation for hire for South Carolina property tax?
Yes for the requesting taxpayer. DOR concluded that a company paid to deliver packages by aircraft, trucks, and vans was primarily engaged in transporting property for hire. Its furniture, fixtures, a…
What did Virginia's 2014 Tobacco Products Tax guidelines require, and what penalties applied to intentionally untaxed products?
The 2014 guidelines required covered distributors to be licensed, pay the Tobacco Products Tax when products were sold in Virginia, file monthly Form TT-8 returns even when no tax was due, and keep de…
What proof did an Illinois restaurant need for tax-exempt government, nonprofit, or foreign-diplomat sales, and was a Moorish card valid?
The restaurant needed an active Illinois exemption number for an exempt organization or governmental entity, or a valid U.S. Department of State diplomatic tax card recognized by Illinois. The sale ha…
Did a bank owe Illinois sales tax when it sold repossessed nursery-school property after foreclosure?
IDOR did not decide on the limited facts. Lending agencies generally owed Retailers' Occupation Tax on repossessed-property sales. A bank acting only as agent for a disclosed owner and not taking titl…
Did IDOR determine that a reseller's software license met Illinois's five conditions for nontaxable treatment?
No specific determination was made. IDOR said a canned-software license was nontaxable only if all five conditions were met, including a ban on third-party transfer without the licensor's permission a…
Is a flat fee to use a golf simulator a taxable admission to a place of amusement, or a non-taxable charge to use a device?
It is not taxable. The flat fee is a charge for the use of the golf simulator -- a device -- not an admission charge to enter the place where the simulators are located. A charge to use an amusement d…
Could buyers of transferred Virginia Land Preservation Tax Credits protect a refund claim while litigation challenged the Department's easement valuation?
Potentially. Virginia did not reverse the Department's lower conservation-easement valuation. Because litigation was pending over that valuation, the taxpayers could consider a protective claim under …
Could a corporation combine two federal short taxable years for Illinois and use more than the historical $100,000 net-loss deduction cap in the second period?
No. Illinois followed the corporation's two federal short taxable years, so each period was a separate Illinois taxable year. The first period generated a $7,215,196 Illinois net loss, while the secon…
Does a nonresident who buys Colorado tax lien certificates owe Colorado income tax on the interest the property owner pays to redeem them?
Yes. A nonresident is taxed on Colorado-source income, and interest on Colorado tax lien certificates qualifies under any of three independent provisions of § 39-22-109(2)(a): it's income from an owne…
Are colocation cross connects, cables, direct private lines, and remote-management software subject to Colorado sales or use tax?
It depends, and the Department gave only limited guidance because the company declined to request a (binding) private letter ruling. Whether colocation cross connects and cables are a taxable rental o…
Could a military spouse claim another state's domicile and Virginia withholding refunds when residence and intent were not established at the same time?
No. The spouse lived in State B only from July through September 2008, while vehicle registrations and voter registration occurred later. Because personal presence and intent to make State B a permane…
Did Virginia's automatic six-month extension preserve a 2008 refund when the taxpayers did not file the original return until October 2012?
No. Because the taxpayers did not file the original 2008 return by the extended due date, the extension was negated and the timely-filing date reverted to May 1, 2009. Their three-year refund period e…
Was propane used to heat migrant-worker housing exempt as agricultural production, and were movable tobacco-curing barns taxable?
The housing propane was taxable because worker comfort and personal needs were not agricultural production for market. By contrast, movable tobacco-curing barns placed on concrete pads remained tangib…
Did New Mexico's income-tax exemption for active-duty armed-forces pay cover a Public Health Service officer's salary?
No. Rochelle Young was a Public Health Service officer, but Section 7-2-5.11 exempted only salary for active-duty service in the armed forces. The decision applied 10 U.S.C. § 101(a), which defined th…
Could remote employees' homes or rented data-center space reduce an Internet-services company's county BPOL receipts through situs or payroll apportionment?
Potentially for 2010-2011, but not automatically. The 2009 refund claim was late. Server space alone was not a definite place of business, while employee homes could qualify after a factual review. Re…
Did a pending IRS reconsideration prevent Virginia from assessing 2005 tax when the taxpayer had not filed a Virginia return?
No. Virginia used the IRS information then available after finding no 2005 Virginia return on file. The return later submitted did not match the federal adjustment, and the Department would not look b…
Did an IRS reconsideration request stop Virginia from assessing tax based on the IRS's existing 2007 audit adjustment?
No. Virginia used the IRS information then available and did not look behind the federal audit determination merely because reconsideration was pending. The assessment remained payable. If the IRS lat…
Could taxpayers defeat a Virginia assessment by saying their 2006 return was e-filed when they had no confirmation number or proof of payment?
No, not on the submitted evidence. Virginia had no record of the return, and the taxpayers kept neither the e-file confirmation number nor proof of payment. The no-return rule allowed assessment at an…
Was a software developer a BPOL retailer or wholesaler because it delivered prewritten software on memory sticks?
No. Physical delivery on memory sticks did not outweigh the company's principal business of developing, licensing, maintaining, and supporting measurement software. Custom development, training, and m…
What annual caps applied to Virginia's Qualified Equity and Subordinated Debt Investments Tax Credit through 2014?
The bulletin listed annual caps of $3 million for 2005-2009, $5 million for 2010, $3 million for 2011, $4 million for 2012, $4.5 million for 2013, and $5 million for 2014. It said the $5 million statu…
Are wasabi and soy seasoned almonds taxable candy/confectionery, or exempt food, when the seasoning contains some sugar?
They are exempt food under Tax Law section 1115(a)(1), not taxable candy or confectionery. Nuts that are not glazed or sugar-coated are exempt food. These almonds are dusted with a spicy, salty wasabi…
Are fines charged for violating parking rules taxable as parking-service charges under New York sales tax?
No -- parking fines are not subject to sales tax. While New York taxes charges for providing parking, garaging, or storing motor vehicles (and that tax applies even to many exempt organizations), a fi…
Is transferring tangible personal property to an LLC in exchange for a membership interest a taxable retail sale?
No -- contributing property to a limited liability company in exchange for a pro rata membership interest is not a taxable retail sale, so no sales or use tax is due. The Tax Law specifically excludes…
Is a service that facilitates obtaining FBI criminal-history records for an employer -- acting only as a conduit -- subject to sales tax as an information service?
No -- the service is not subject to sales or use tax. The provider merely acts as an authorized channeling agency, transmitting an employer's fingerprint/authorization request to the FBI and forwardin…
Could a grocery store replace Virginia's two-day estimated sales-tax audit with revised EBT schedules when it lacked records of gross food sales?
Not yet. The store's inadequate records allowed Virginia to estimate taxable sales from a two-day observation period the store had accepted. EBT records could support revised exempt sales, but they di…
Are art-party participation charges taxable, and may the operator buy canvases, paint, and supplies tax-free for resale?
The art-party charge was taxable as admission to and participation in an amusement activity. When canvas, paint, and supplies were included without separate charges, the operator was their consumer an…
When and how does the Nebraska Department of Revenue publish its written responses to taxpayer inquiries, and what is the difference between a GIL, a revenue ruling, a taxpayer ruling, and a declaratory order?
Revenue Ruling 99-14-1 explains when and how the Nebraska Department of Revenue publishes its written answers to taxpayer questions, balancing the public benefit of guidance against strict confidentia…
Was a museum's lease of restaurant and food-service space exempt as an exhibition-hall concessionaire lease?
Yes. The museum qualified as an exhibition hall, and the restaurant was a retail concessionaire selling food and drink to the public within the facility.
Were chemicals used between printing-ink production runs exempt as supplies used directly in manufacturing?
No. Although cleaning prevented color contamination and protected product quality, the chemicals were used only after one ink run stopped and before the next began. Because they were not actively and …
Could taxpayers overturn old Virginia assessments by claiming that only government employees and seamen were subject to income tax?
No. The administrative appeals for 2006 and 2008-2012 were filed beyond 90 days, and the paid 2007 assessment's refund claim missed its separate three-year deadline. Virginia also stated that the argu…
Did survivor-annuity payments from a federal retirement plan qualify for Virginia's annuity death-benefit subtraction?
No. Virginia limited the subtraction to a federally taxable lump-sum death benefit from an annuity contract between a customer and an insurance company. The taxpayer's survivor payments came from a fe…
Could a county reject a poultry processor's manufacturer classification for 2006-2009 solely because supporting documents arrived after an initial 45-day period?
No final classification was made. Virginia found the taxpayer made a good-faith effort within the original 45 days, while the county specified needed records only afterward and then ignored the additi…
Was an appeal complete when a taxpayer mentioned an IRS dispute and challenged penalties and interest but identified no error, facts, or legal authority?
No. The taxpayer's letter did not identify an alleged assessment error, relevant facts, grounds for relief, or controlling authority, so it was not a complete appeal. The 2012 assessment based on tax …
Could an employee subtract his own Form W-2 wages under Virginia's federal jobs-credit or Work Opportunity Credit subtraction?
No. The subtraction was designed for an employer whose federal wage deduction was reduced because the same wages generated the federal Work Opportunity Credit. The taxpayer neither incurred employer w…
Could a taxpayer abate Virginia's 2009 assessment by producing only a State A return showing residence there for the first six months?
Not on that record. A State A return showing residence there for the first six months did not establish that Virginia domicile had been abandoned or quantify the correct liability. Because the taxpaye…
Did a federally taxable survivor benefit from a federal retirement plan qualify for Virginia's annuity death-benefit subtraction?
No. Virginia required a federally taxable lump-sum death benefit from an annuity contract between a customer and an insurance company. The wife's benefit came from a federal retirement plan, so it fai…
Which sales and equipment purchases did Virginia remove from a packaged-concrete manufacturer's sales/use-tax audit?
Virginia granted partial relief. It removed one qualifying underground-mine project sale for this audit, an exempt label machine, a server first used and taxed in another state, and replacement compre…
Which furniture-manufacturing, advertising, certificate, and penalty items did Virginia change in a sales/use-tax audit?
Virginia ordered a partial audit revision. It removed a valid resale sale, certified pollution-control filters, direct out-of-state shipments, and qualifying printed materials; it kept invalid carrier…
Did a tax preparer's fax of an unsigned federal return prove that a 2010 return was filed and require New Mexico to recalculate a 1099-based assessment?
No. Guidance Tax Services faxed Melinda Schramm's 2010 return to the IRS, but the IRS rejected it because it needed an original signed return. Her wage-and-income transcript showed only Form 1099-MISC…
Can a Kansas taxpayer subtract the net gain from selling certain breeding or draft livestock?
Kansas Notice 14-04 (revised July 15, 2014) explains that 2014 Senate Bill 265 added a subtraction modification, K.S.A. 79-32,117(c)(xxii), for the net gain from selling certain livestock: (1) cattle …
Are canned coffee-based energy drinks taxable soft drinks, or exempt coffee, when sold to go?
They are exempt. Sold in cans for off-premises consumption, Starbucks Doubleshot Energy coffee drinks are treated as coffee, not as a taxable soft drink. Coffee is the first listed ingredient and the …
Are tickets to a narrated sightseeing bus tour -- which includes brief staged street performances -- subject to NY sales tax?
No -- the bus tour tickets are not taxable. The tax on transportation services doesn't reach bus service (a bus seats 15+ and is excluded from taxable 'livery service'), so the tour isn't a taxable tr…
How did Georgia's manufacturing and agricultural exemptions apply to a poultry processor's refrigerated trailers and sanitizing chemicals?
Registered refrigerated trailers never qualified as manufacturing machinery but were exempt agricultural equipment for a qualified producer beginning in 2013. Manufacturing sanitizing chemicals were t…
Was a software vendor's outsourced printing and mailing of customer invoices and late letters taxable in Illinois?
IDOR did not decide without the invoices, license, contracts, registration status, and delivery facts. A service with no tangible-property transfer generally was outside Retailers' Occupation and Serv…
When is South Carolina's 2014 sales tax holiday and what items are exempt (per SC IL #14-10)?
South Carolina's 2014 sales tax holiday runs from 12:01 a.m. Friday, August 1, 2014 through midnight Sunday, August 3, 2014. During that three-day weekend, the 6% state sales and use tax and any appli…
Are receipts from branded 'mind body' fitness classes (yoga-based but marketed for toning) subject to New York City sales tax?
Yes -- when the classes are aimed at improving bodily appearance (building strength, toning, sculpting), the facility is a 'weight control salon, health salon, gymnasium or similar establishment,' and…
How can taxpayers check whether an older South Carolina advisory opinion was modified or superseded (per SC IL #14-9)?
Use the citator attached to SC Information Letter #14-9. It helps you determine what effect newer South Carolina advisory opinions have on previously published ones — whether an opinion was modified, …
Can modular or container server units qualify as Georgia high-technology facilities, and which parts count as exempt computer equipment?
The NAICS 51121 operator qualified as a high-technology company, and a modular or container server could be a qualifying facility when it was a single physical establishment with a qualifying primary …
If I arrange HVAC repair and maintenance through subcontractors and bill my clients directly, are my charges (including my management fee) taxable?
Yes -- you are the retail vendor of taxable repair and maintenance services, so all of your receipts from those services, including your separately stated management fee, are subject to sales tax. The…
Did Florida documentary stamp tax apply to the initial and later advances under a business-loan agreement?
The initial advance was taxable because the agreement contained a signed, unconditional promise for a fixed sum. Later advances were not taxable because they remained contingent when the agreement was…
Were emergency notification, voice-message, and interactive voice-response services subject to Florida CST or sales tax?
Generally no on these facts. Notification and voice-message products were information services, while IVR phone access or transfer was communications service sourced outside Florida and not charged to…
Was Florida sales tax still due after a landlord merged into its tenant and the surviving tenant owned the property?
No. The landlord ceased to exist in the merger, title vested in the surviving hospital, and no landlord-tenant relationship or rent payment remained to create taxable rental consideration.
How did Illinois tax forensic data-collection services delivered online, with no results, or on a hard drive, disc, or thumb drive?
Online viewing or downloading of extracted text and data, and a service producing no transferred property, generally involved no taxable tangible property. Delivering the results on a hard drive, CD/D…
Did a prior no-exception audit and alleged oral advice excuse a cigar retailer from tobacco products tax on purchases from unregistered out-of-state vendors?
No. Santa Fe Cigar bought tobacco products from out-of-state vendors not registered in New Mexico, making it the first purchaser liable for tobacco products tax. A 2006 audit found no exceptions becau…
What project-income and carryforward method did Florida approve for a $100 million manufacturing expansion?
Florida approved actual gross profit by qualifying production line, less project expenses and adjusted Schedule M items, followed by Florida apportionment to determine project tax and credit.
Did a federal employee remain domiciled in another state after settling with his family and conducting his affairs in Virginia?
No. The taxpayer's declaration of State A domicile was outweighed by his conduct: he had not lived there since 1999, documented no continuing ties, and instead maintained a family home, driver's licen…
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