Connecticut State Tax Rulings
Free plain-English summaries of state tax letter rulings and advisory opinions issued in Connecticut, with full citations and the original source on every page.
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When a hotel stay lasts more than 30 consecutive days, does Connecticut's room occupancy tax still apply to the first 30 days?
Historical rule -- this Ruling has since been OBSOLETED by Announcement 94(8) and no longer states current law, so confirm the current treatment before relying on it. A hotel agreed to provide lodging…
Are a mutual fund's exempt-interest dividends derived from Puerto Rico obligations subject to Connecticut's dividend and interest income tax?
Exempt -- but this concerns a Connecticut tax that no longer applies in this form (the ruling is obsoleted by AN 94(2), obsoleted in part by PA 94-4 § 13, and superseded in part by SN 95(17)), so trea…
Must a parent company add back expenses connected to a dividend from its wholly-owned subsidiary when it has already reallocated all of its income and expenses to its subsidiaries?
No add-back on these specific facts -- and note DRS marks this Ruling 'not current,' so it is historical and highly fact-bound. A parent company filed a Connecticut combined corporation business tax (…
Is retipping a manufacturer's worn carbide saw blades a taxable repair service, or an exempt purchase of manufacturing tools?
Repair is taxable; a new blade is exempt -- but note this ruling is marked not current (obsoleted in part by AN 2000(8), clarified by Ruling 94-4), so confirm today's law. A kitchen-cabinet manufactur…
Were a nonprofit hospital's human-relations and organizational consulting services subject to Connecticut sales and use tax?
No under this historical ruling. A nonprofit charitable hospital's division advised public, private, and nonprofit organizations on workplace stress, wellness, morale, motivation, collaboration, commu…
Did Connecticut's former capital gains tax apply when an older retirement-plan participant elected federal transitional capital-gain treatment for a lump-sum distribution?
Yes under this historical ruling. A Connecticut resident who had reached age 50 before January 1, 1986 and elected Pub. L. No. 99-514 § 1122(h)(3) treatment for a qualified-plan lump-sum distribution …
Was a Connecticut S corporation shareholder's share of interest income subject to the former dividend and interest income tax when federally reported as nonseparately computed income?
No under this historical ruling. When the S corporation's interest income was properly reported for federal purposes as a nonseparately computed item, the resident shareholder's pro rata share was not…
Was hazardous-waste cleanup performed under a state environmental mandate considered 'voluntary' and excluded from Connecticut sales tax?
No under this historical ruling. The exclusion in Conn. Gen. Stat. § 12-407(2)(i)(I) applied only when a company acted solely on its own initiative. Cleanup following a federal or state agency mandate…
Were an accounting firm's economic and financial litigation-support services taxable as business analysis or management consulting in Connecticut?
No under this historical ruling. The accounting firm reviewed case materials, researched financial and business data, formed expert opinions, prepared exhibits and testimony, and assisted attorneys wi…
How did Connecticut historically tax services provided to condominium associations with both owner-occupied and leased units?
The 1990 ruling used three categories. Some services -- including landscaping, maintenance, janitorial, exterminating, design, locksmith, window cleaning, pool work, and tangible-property repair -- we…
Could printing trade vendors buy film, paper, chemicals, and other production inputs tax-free as resale or manufacturing materials?
Only materials physically incorporated into the product sold could be bought for resale under this historical ruling. DRS did not consider color separators, typesetters, or assemblers of mechanicals, …
Were consulting and public-relations services provided to a political candidate exempt from Connecticut sales and use tax?
No under this historical ruling. Conn. Gen. Stat. § 12-407(2)(i)(J) taxed consulting and public-relations services, and the law provided no exemption merely because the customer was a political campai…
Were commissions paid by commercial printers to an independent printing broker taxable sales-agent services in Connecticut?
No under this historical ruling. Printing brokers solicited bids or placed client jobs with different commercial printers and charged the selected printer a fee. DRS treated them like independent comm…
Could a leasing company issue resale certificates for labor on repairs, maintenance, and painting of property held exclusively for lease?
Yes under this historical ruling, effective for services on or after September 1, 1990. A lessor could issue a resale certificate for repair and maintenance services -- including vehicle painting -- p…
Which parts of a shopping-mall expansion were nontaxable new construction rather than taxable renovation under Connecticut's historical rules?
New space above the former roof, the new roof, and work at or below the original ground-slab elevation were new construction. A partial floor was allocated 75% new construction and 25% renovation base…
Were independent dietetic counseling and kitchen-operation services provided to nursing homes taxable consulting services in Connecticut?
Yes under this historical ruling. The dietitian reviewed patient histories and eating habits, advised staff on special diets and food preparation, educated patients and families, and reviewed kitchen …
Were fees for servicing Connecticut Housing Finance Authority home mortgage loans subject to Connecticut sales and use tax?
No. Although mortgage servicing fees were generally taxable as a business management service under the historical rule, fees for servicing Connecticut Housing Finance Authority loans were exempt. CHFA…
How did Connecticut historically tax printing plates, pressroom materials, and outsourced or internally produced prepress items?
Raw plate materials and chemicals physically applied to the plate were exempt, as was an imaged ready-to-press plate. Ink and listed pressroom chemicals were used directly in manufacturing. Specified …
Was interest on promissory notes issued by a Connecticut district excluded from Connecticut's former dividend and interest income tax?
Yes under the former tax. DRS treated promissory notes issued by a district organized under Conn. Gen. Stat. § 7-325 as obligations of a district created under Connecticut law. Interest paid on those …
Were mortgage-servicing and related management services performed in Connecticut taxable when the mortgage holders were outside Connecticut?
No under the historical sourcing rule. Mortgage servicing was a taxable management service, but it was accepted or received where the mortgage holder was located, so services for out-of-state holders …
Did replacing an old building's entire internal structure count as new construction when two historic exterior brick facades remained?
Yes under the historical rule. The project created a new four-story building with new floors, support columns, walls, and internal materials; only two historic brick facades remained and were reanchor…
Were engineering design services taxable for plant equipment shelters and for a small mobile, easily disassembled control building?
Building-design services for private clients were taxable regardless of the building's use, including shelters for equipment at wastewater, solid-waste, or waste-treatment plants; municipal projects w…
Which fees charged at a dealer-to-dealer motor vehicle auction were taxable as services of a seller's agent?
Under this historical ruling, the selling commission, vehicle entry fee, and delayed title-work fee were taxable seller-agent services. The dealer registration fee, buyer's commission, and genuine veh…
Was a bank's mortgage servicing taxable when it continued collecting and processing payments after selling the mortgage?
Yes under this historical ruling when the service was rendered to or received by a Connecticut bank holding the mortgage loans. DRS classified mortgage servicing as a business analysis and management …
Was a one-time cleaning of a newly constructed store taxable when performed before the certificate of occupancy?
Yes under this historical ruling. After the July 1, 1989 change, DRS treated janitorial services as taxable in all instances, including one-time cleaning before a new store received its certificate of…
Were a wedding coordinator's full-service, partial-service, referral, or commission fees subject to Connecticut sales and use tax?
No under this historical ruling. DRS said wedding-coordinator service fees were not taxable, but tangible personal property sold by the coordinator was taxable. Tax on caterers, photographers, videogr…
Did converting a vacant manufacturing building into residential condominiums count as nontaxable new construction because the renovation cost exceeded the building's price?
No under this historical ruling. DRS treated work performed solely inside the existing building as a taxable renovation. The building's vacancy and the high renovation cost relative to its purchase pr…
Were architectural services for the State of Connecticut exempt when a Connecticut contractor subcontracted some or all work to a related foreign corporation?
Yes under this historical ruling. Architectural services rendered to the State were exempt whether performed directly or through the subcontract. The Connecticut corporation could issue the foreign af…
Did the historical exemption for repairing nonbusiness motor vehicles cover labor on boats or snowmobiles?
No under this historical ruling. DRS said the exemption for repairs to motor vehicles not used in a trade or business did not apply to boats or snowmobiles. Labor charges for repairing either were the…
Were bridge engineering services by licensed professional engineers taxable as building engineering services?
No under this historical ruling. DRS said bridge engineering by licensed professional engineers was not building engineering and therefore was not subject to sales and use tax. DRS marks the ruling no…
Were environmental-facility siting and remediation-design services taxable as building engineering or building design?
Generally no under this historical ruling. DRS excluded siting and design of landfills, impoundments, hazardous-waste facilities and incinerators, plus groundwater cleanup and remedial-program design.…
Were an architect's project inspections for a construction lender taxable as architectural work or business consulting?
They were taxable business consulting under this historical ruling, not exempt new-construction or architectural services. The architect verified a borrower's payment requests for the lending bank and…
Did nonprofit craft centers have to collect tax on craft and artwork sales and on consignment fees charged to artists?
Yes under this historical ruling. The exemption covered sales to qualifying nonprofits, not their sales to customers, apart from two permitted one-day events. Craft centers had to tax craft and artwor…
Which landscaping, surveying, stakeout, feasibility, engineering, roadway, drainage, and septic-design services were taxable?
Under this historical ruling, residential and commercial landscaping, subdivision surveying, and stakeout for real-estate development were taxable. Site feasibility studies, site-development engineeri…
When were construction-management services taxable for new construction, owner-occupied homes, and existing business property?
Under this historical ruling, construction management for new construction and existing one-, two-, or three-family exclusively residential owner-occupied property was not taxable. The same service fo…
Were auction sales of bank-repossessed tangible personal property and the auctioneer's fee to the bank taxable?
Yes under this historical ruling. The auctioneer had to collect tax on total gross receipts from selling the repossessed property. The auctioneer's fee charged to the bank was also taxable as a sales-…
Were guest greens fees, tennis-court fees, club-professional services, and the professional's property sales or leases taxable?
Under this historical ruling, a country club's greens fees and court-time fees charged to members' guests were not taxable, and club-professional services were exempt. But tangible personal property s…
When were installation, renovation, repair, and maintenance services taxable in owner-occupied and rented condominium units?
Under this historical ruling, painting, carpentry, electrical, and plumbing labor billed directly to residents was nontaxable in owner-occupied units but taxable in rented units. Association-wide work…
When were masonry and sprinkler installation taxable, and were landscaping and tree-removal services taxable?
Under this historical ruling, masonry and sprinkler installation were taxable on existing commercial, industrial, or income-producing property but not at new construction or qualifying owner-occupied …
Was sharpening or resharpening cutting tools used in manufacturing taxable, and could the manufacturer issue an exemption certificate?
Under this historical ruling, sharpening manufacturing cutting tools was a taxable repair or maintenance service. The manufacturer could not issue a resale certificate or manufacturer's exemption cert…
Were a private golf club's golf-cart rentals, greens fees, locker rentals, and bag-storage fees taxable?
Under this historical ruling, golf-cart rentals were taxable rentals of tangible personal property. Greens fees, locker rentals, and bag-storage fees were not subject to sales and use tax. DRS marks t…
How did a general contractor handle tax on subcontracted services for an out-of-state customer, especially when the services also benefited the contractor?
Under this historical ruling, the contractor could buy subcontracted taxable services for resale and charge tax to the ultimate consumer. No tax applied when the foreign customer received the service …
Which guest-use and instruction charges at a member-owned private country club were excluded from sales and use tax?
Under this historical ruling, guest golf, swimming, paddle-tennis, tennis, beach-club, and shooting-club fees were not subject to sales and use tax. Golf, swimming, paddle-tennis, and tennis lessons f…
How were civil engineering, subcontracted land surveying, landscaping, and services connected with State projects taxed?
Under this historical ruling, the firm's civil engineering was not taxable building engineering. Boundary and topographic surveys bought from land-surveyor subcontractors were taxable and could not be…
Were an engineer's study and maintenance recommendations for a harbor fuel-oil transfer pier taxable as building engineering or design services?
No under this historical ruling. Studying a fuel-oil transfer pier, reporting its deficiencies, and recommending maintenance and corrective measures were not taxable building engineering or building p…
Were engineering services for improvements and modifications to utilities' existing fuel systems taxable as building engineering or design?
No under this historical ruling. A consulting engineer's designs for safe and reliable operation of local electric utilities' existing fuel systems or processes were not taxable building engineering o…
Were total landscaping receipts taxable, and could landscapers buy bolts, cables, and lags for resale?
Under this historical ruling, total gross receipts for landscaping services were taxable. Landscapers could buy bolts, cables, and lags tax-free for resale by giving suppliers valid resale certificate…
Were manufacturing tool-resharpening services taxable when performed inside or outside Connecticut?
Yes under this historical ruling. Beginning July 1, 1989, repair and maintenance services to tangible personal property were taxable, including tool sharpening obtained by Connecticut companies even w…
Were fees for martial-arts, tennis, or gymnastics lessons subject to sales and use tax?
No under this historical ruling. Fees charged for lessons in martial arts, tennis, or gymnastics were not subject to sales and use tax. DRS marks the ruling not current and obsoleted by AN 95(3).
Did sales and use tax apply to greens fees or charges for golf, tennis, and swimming lessons?
No under this historical ruling. The health and athletic club services tax did not apply to greens fees or charges for golf, tennis, and swimming lessons. DRS says AN 95(3) obsoleted the ruling.
Were health and athletic club service fees charged by a charitable nonprofit organization subject to sales and use tax?
No under this historical ruling. Charges or fees for health and athletic club services provided by a charitable nonprofit organization were not subject to sales and use tax. DRS says AN 95(3) obsolete…
Was grinding existing pavement and reusing it as the base for a new parking lot taxable when no new materials were added?
No under this historical ruling. Recycling the pavement into the base of a new parking lot, without adding new materials during recycling, was treated as nontaxable new construction. DRS states that A…
Were greens fees, golf lessons, and tennis lessons, clinics, or tournaments at public and private clubs taxable?
No under this historical ruling. Greens fees and golf lessons, plus tennis lessons, clinics, and tournaments, were not taxable at either public or private clubs. DRS marks the ruling not current and o…
Were Company X's tour receipts taxable, and how were its purchases used to provide the tours treated?
The tour receipts were not subject to sales and use tax under this historical ruling. Company X was the final consumer of purchases used to perform the tours and had to pay applicable sales tax and/or…
Were lobbying services performed by an employee for the employee's association employer taxable?
No under this historical ruling. Although lobbyist services became taxable on July 1, 1989, services an employee rendered for the employer were outside the tax. DRS said the apparent association emplo…
Were total receipts from landscape, horticultural, and tree-removal services subject to Connecticut sales and use tax?
Yes under this historical ruling. Total gross receipts from landscape and horticultural services were taxable, and tree removal counted as a horticultural service. DRS marks the information not curren…
Was the 40% commission retained by a nonprofit arts school's store for selling artists' consigned goods subject to Connecticut sales tax?
Yes under this historical ruling. The nonprofit school acted as a sales agent and its retained 40% of the selling price was a taxable fee or commission. DRS marks the information not current and says …
Were environmental engineering services taxable, and how did Connecticut treat building design included with those services?
Environmental engineering services were not taxable under this historical ruling, but designing a building to house a facility such as a water-treatment plant was taxable and had to be separately stat…
How were manufacturer warranties, extended warranties, repair parts and services, and mixed maintenance contracts taxed under Connecticut Ruling 89-152?
Manufacturer-warranty repairs and parts were nontaxable. Extended-warranty repairs and parts were taxable, though the contract sale itself was not; no-charge parts triggered use tax, no-charge service…
Was photoengraving a manufacturing production process that qualified its machinery for Connecticut's sales-tax exemption?
No under this historical ruling. DRS classified photoengraving as processing, not manufacturing, because it did not substantially change personal property's form, composition, or character. The machin…
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These are official tax letter rulings and advisory opinions issued by Connecticut's revenue authority in response to questions from specific taxpayers about how the tax law applies to their facts. A ruling is binding on the department only for the taxpayer who requested it and cannot be relied on by anyone else, but it is strong evidence of how the state reads the law. Every ruling above has a plain-English question and short answer, plus a link to the full original source.