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Ezel / Tax Rulings / CT
CT Ruling 89-218 Sales and Use Taxes 1989-11-15

Were X-ray or chemical inspection services taxable when performed on real property or tangible personal property?

Short answer: Inspections of industrial, commercial, or income-producing real property were taxable except for new construction, while inspections of tangible personal property were not taxable. DRS marks the guidance not current and says Public Act 94-4, § 13 partly obsoleted it.

Apply this to your situation

This page answers the general question as of 1989. Ezel answers yours, under current Connecticut tax law, with citations.

Currency note: this ruling is from 1989
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official 1989 Connecticut Department of Revenue Services Ruling reflecting the inspection-service rules then in effect. DRS expressly marks the information 'not current' and says Public Act 94-4, § 13 (May Special Session) obsoleted it in part, referring readers to Special Notice 95(17). Its real-property, new-construction, and tangible-personal-property distinctions should not be assumed current. Connecticut imposes sales and use tax solely at the state level: there are no local or municipal sales taxes. This summary is informational only and is not legal or tax advice. Consult a licensed Connecticut tax professional about your specific situation.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page as a PDF) is the authoritative source for any reliance.
View original ruling (PDF)

Note -- partially obsolete historical guidance. DRS marks this information "not current" and states that Public Act 94-4, § 13 (May Special Session) partly obsoleted the ruling, with a reference to Special Notice (SN) 95(17).

Plain-English summary

X Company used X-ray or chemical processes to inspect for cracks and defects. The requested categories covered real property and tangible personal property held either as fixed assets or inventory.

DRS said inspection services were taxable when performed on industrial, commercial, or income-producing real property, except when performed for new construction. Inspection services performed on tangible personal property were not taxable.

What this means for you

The historical ruling classified the service by the property inspected. Later legislation partly obsoleted the guidance.

Common questions

Were inspections of industrial or commercial real property taxable? Yes, except for new construction.

Were inspections of tangible personal property taxable? No under the ruling.

Did the ruling distinguish fixed assets from inventory? It listed both categories of tangible personal property and gave both the same nontaxable result.

Citations and references

  • Conn. Gen. Stat. § 12-407(2)(i)(I), as cited in the ruling.
  • Public Act 94-4, § 13 (May Special Session) -- identified by DRS as partly obsoleting this ruling.
  • Special Notice (SN) 95(17) -- referenced by DRS with the obsolescence notice.

Source

Original ruling text

Ruling 89-218, Inspections

This information is not current and is being provided for reference purposes only

Ruling 89-218

Inspections

This Ruling has been obsoleted in part by PA 94-4, §13 (May) (see  SN 95(17 )

You have requested a ruling as to the taxability of the following services performed by your client:

  1. Inspection services on real property;

  2. Inspection services on tangible personal property of a fixed asset nature; and

  3. Inspection services on tangible personal property of an inventory nature.

X Company's services include an X-ray and/or chemical process to determine improprieties, such as cracks or defects.

The taxability of X Company's services are as follows:

Taxable if rendered to industrial, commercial or income producing property pursuant to section 12-407(2)(i)(I) of the Connecticut General Statutes, except as rendered to new construction; and

Non-taxable if rendered to tangible personal property.

LEGAL DIVISION

November 15, 1989

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