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Ezel / Tax Rulings / KS
KS P-2004-015 Kansas Retailers' Sales Tax 2004-04-30

Is alarm monitoring service taxable in Kansas, and is installing the equipment taxed differently for homes and businesses?

Short answer: Monitoring service itself is not taxable in Kansas — a Missouri company charging Kansas residents for monitoring does not charge Kansas sales tax on it, because the Kansas sales tax act does not tax monitoring services. Installing the equipment is treated differently by location. Equipment installed in a Kansas commercial establishment is taxable on both the labor and the materials: K.S.A. 79-3603(a) taxes the property and K.S.A. 79-3603(p) taxes the installation labor. Equipment installed in a Kansas residence is taxable only on the materials — the labor to install tangible personal property such as monitoring equipment into a residence is exempt.

Apply this to your situation

This page answers the general question as of 2004. Ezel answers yours, under current Kansas tax law, with citations.

Currency note: this ruling is from 2004
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 Kansas Department of Revenue Private Letter Ruling (issued under K.A.R. 92-19-59). It binds the Department only as to the specific retailer who requested it and the facts stated; taxpayer-identifying details are redacted. It may not be cited or relied upon as precedent by any other person, and it ceases to be valid if a statute, regulation, or interpretation it relied upon changes substantially. Kansas state and local sales and use taxes are administered centrally by the Department, so there is no self-collected home-rule city tax outside its scope. This summary is informational only and is not legal or tax advice.
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)

Plain-English summary

An out-of-state (Missouri) company that provides monitoring service and installs monitoring equipment in Kansas asked how Kansas sales tax applies.

The Department gave three answers:

  • Monitoring service is not taxable. A Missouri company charging Kansas residents for monitoring does not charge Kansas sales tax on the monitoring, because the Kansas retailers' sales tax act does not impose tax on monitoring services.
  • Equipment installed in a commercial building — tax on both labor and materials. Kansas taxes all sales of tangible personal property (K.S.A. 79-3603(a)), and installation labor is a specifically enumerated taxable service (K.S.A. 79-3603(p)). So equipment installed in a Kansas commercial establishment is taxable on both the materials and the installation labor.
  • Equipment installed in a residence — tax on materials only. The materials are still taxable under K.S.A. 79-3603(a), but there is an exemption for the labor to install tangible personal property (such as monitoring equipment) into a residence under K.S.A. 79-3603(p). So residential installation is taxable only on the materials.

What this means for you

Alarm/monitoring companies

Your recurring monitoring charge is not subject to Kansas sales tax. Your equipment and installation, however, are taxed — and the treatment turns on whether the site is commercial or residential.

Commercial installations

Charge tax on both the equipment and the installation labor.

Residential installations

Charge tax on the equipment (materials) only; the installation labor into a residence is exempt.

Common questions

Q: Do I charge Kansas sales tax on a monitoring subscription?
A: No. The Kansas sales tax act does not tax monitoring services.

Q: How is installing the equipment taxed in a business?
A: Both the materials and the installation labor are taxable (K.S.A. 79-3603(a) and 79-3603(p)).

Q: How is installing the equipment taxed in a home?
A: Only the materials are taxable; the labor to install tangible personal property into a residence is exempt under K.S.A. 79-3603(p).

Citations and references

  • K.S.A. 79-3603(a) — imposes Kansas sales tax on sales of tangible personal property; makes the monitoring equipment (materials) taxable in both homes and businesses.
  • K.S.A. 79-3603(p) — makes installation labor a taxable service, but exempts the labor to install tangible personal property into a residence; the basis for taxing commercial installation labor while exempting residential installation labor.

Source

Source

Original ruling text

Private Letter Ruling

Body:

Office of Policy & Research

April 30, 2004

XXXXXXXXXXXXXXXXXXX
XXXXXXXXXXXXXXXXXXXXXXXX
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Dear Sirs:

The purpose of this letter is to respond to your request dated January 16, 2004. In it you asked if the gross receipts from the sale of services performed in Kansas are subject to sales tax in light of recent changes in the sales tax act.

A Missouri company charging Kansas residents for monitoring service is not required to charge Kansas sales tax for monitoring. This is true because the Kansas retailers’ sales tax act does not impose sales tax on monitoring services.

Equipment installed in a Kansas commercial establishment is subject to sales tax for both labor and materials. Kansas law generally imposes sales tax on all sales of tangible personal property [K.S.A. 79-3603(a)]. Labor services for the installation of tangible personal property are specifically enumerated in the law as a service which is subject to tax [K.S.A. 79-3603(p)].

Equipment installed in a Kansas residence is subject to sales tax only on the materials. Kansas law generally imposes sales tax on all sales of tangible personal property [K.S.A. 79-3603(a)]. Labor services for the installation of tangible personal property are specifically enumerated in the law as a service which is subject to tax, but there is an exemption from sales tax for labor services performed for the installation of tangible personal property such as monitoring equipment into a residence [K.S.A. 79-3603(p)].

This is a private letter ruling pursuant to K.A.R. 92-19-59, based on the representations you have made. To the extent those representations are incomplete or inaccurate, this ruling is void. This ruling will be revoked by operation of law without further department action if

there is a change in the controlling statutes, administrative regulations, revenue rulings or case law that materially effects this determination.

Sincerely,

Mark D. Ciardullo
Tax Specialist

MDC

Date Composed: 05/06/2004 Date Modified: 05/06/2004

Table 1

Ruling Number: P-2004-015

Table 2

Tax Type: Kansas Retailers' Sales Tax
Brief Description: Gross receipts from the sale of services performed in Kansas.
Keywords:
Approval Date: 04/30/2004

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