New York State Tax Rulings
Free plain-English summaries of state tax letter rulings and advisory opinions issued in New York, with full citations and the original source on every page.
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Can an event planner buy tents, chairs, tables, and catering with a resale certificate and pay no tax on its own purchases, or must it pay tax on what it buys and only charge tax on its overall bill to the client?
No -- an event planner cannot buy equipment rentals like tents, tables, and chairs tax-free with a resale certificate, because it's using those items to provide its own event-planning service rather t…
Is software licensing, plus separately stated charges for customization, testing, training, and maintenance, subject to New York sales and use tax?
Yes, the software license itself is taxable -- the modules are prewritten software even though later customized to each customer. But separately stated, reasonable charges for customization, testing, …
Are labels and tags sold to manufacturers and retailers, which they attach to products or to packaging, exempt from New York sales tax as either a resale or as packaging material?
It depends on what the label or tag actually does. Labels and tags that describe the product, identify its maker, or provide information the end customer needs (a "critical element" of the product) ca…
Are cardboard compactors that a waste-removal company places at shopping centers to collect and crush cardboard for recycling exempt from sales tax as production equipment?
No -- the compactors are subject to sales and use tax. New York's production-equipment exemption only covers machinery used directly and predominantly in actually manufacturing or processing a product…
Is an out-of-state electronic health-claims clearinghouse subject to New York franchise tax when it installs equipment and trains customers here, and which of its fees and equipment are subject to sales or use tax?
On franchise tax: once the company acquires New York customers and sends employees in to install computer hardware/software and train customer staff, it is doing business and has property in New York,…
Does a radioactive-waste disposal company owe use tax on out-of-state-purchased containers it gives customers, and is its entire disposal charge taxable even though the waste and containers are ultimately buried or processed outside New York?
No use tax applies to the containers themselves, since they're actually transferred to the customer as part of a taxable disposal service rather than purchased at retail by the company. But the compan…
Is a hazardous-waste broker's fee for arranging removal, transportation, and treatment/disposal of waste taxable when the waste is actually treated or disposed of outside New York State?
It depends on whether the waste is actually treated or disposed of inside or outside New York, and on whether the broker is acting as its customer's agent or as the actual service provider. Removing a…
Is a competitive local phone carrier's purchase of fiber optic network access from an in-state network owner taxable, or is it exempt as a purchase for resale?
No -- the network access fees aren't subject to sales tax, because the local exchange carrier is buying the fiber optic capacity as a component of the telephone service it resells to its own end-user …
Is a driving school's road test vehicle usage fee taxable, and must it collect sales tax when it occasionally sells one of its cars to an individual?
The charge for supplying the vehicle itself for the road test is taxable as a rental, along with the special passenger car rental tax -- but if the driving school separately states and bills its nonta…
Is installing custom shutters and blinds as original equipment in a new home, before construction is finished, a tax-exempt capital improvement?
It depends on the item. Custom shutters installed as part of the original finish carpentry before construction was complete -- enclosing the window and door casings -- are excluded from tax as part of…
Does a new nonprofit LLC formed to manage a national laboratory meet the organizational test for New York's sales-tax exemption as a scientific/educational organization?
Yes -- based on the operating agreement submitted, Brookhaven Science Associates, LLC's purposes are limited to scientific research, education, and related exempt purposes, its earnings and dissolutio…
Are a public broadcasting station's charges for producing and broadcasting a corporate client's private television program subject to New York sales tax?
No -- the broadcasting station's separately stated charges for producing and broadcasting the program (studio time, set-up and breakdown, employee time, and satellite transmission) are not subject to …
Are charges for leasing a private luxury suite at an arena, and separate charges for suite-related advertising, subject to New York's admissions tax?
It depends on the type of suite agreement. Under agreements granting permanent exclusive use of a suite, the rental is taxable admissions -- but only measured against the events for which the suite is…
Is furniture manufactured in New York and delivered directly to an out-of-state buyer in Nevada subject to New York sales or use tax?
No -- since the furniture is delivered directly to the buyer in Las Vegas and possession transfers there, not in New York, the New York manufacturer doesn't have to collect or remit New York sales or …
Are specialized roll-off containers a waste hauler buys to collect hot ash for a manufacturer's landfill-capping-material production exempt from sales tax as production equipment?
No -- the roll-off containers are subject to sales and use tax. Even though they're custom designed for hot ash and the ash is later used as raw material in another company's manufacturing process, th…
Does a public warehouse that stores and ships customers' inventory provide 'fulfillment services,' and do its out-of-state customers get New York franchise tax or sales tax nexus by using it?
Yes, and the customers get no nexus. Distribution Unlimited's public-warehousing activities -- storing manufacturers' and distributors' inventory and shipping it by common carrier on the owner's instr…
Are coin-operated vacuum machines and tire-inflation machines at car washes and gas stations exempt from New York sales tax?
It depends on the machine and the location. Coin-operated vacuum services at a car wash facility (self-service or otherwise, as long as no employee assists) became exempt from sales tax on December 1,…
Is a university's annual campus vehicle registration fee, separate from its parking fee, subject to New York sales tax?
No -- the vehicle registration fee is not subject to sales tax, because it's a genuinely separate charge for identifying and documenting vehicles on campus (unrelated to parking privileges), not a fee…
When two construction companies form a joint venture and each contributes equipment, is that equipment subject to sales or use tax?
It depends entirely on the structure of the arrangement, not on the fact that it's a joint venture. If a partner simply contributes equipment as its capital stake in exchange for a share of the ventur…
Are an underwater/topside inspection and reporting subconsultant's services for government infrastructure projects subject to New York sales tax?
It depends on what the inspection and reporting is for. If the services support a real-property repair or maintenance project, they're taxable as maintaining real property; if they support a capital i…
Is transferring tangible personal property to a new corporation, partnership, or single-member LLC as part of a corporate restructuring, in exchange for stock or a membership/partnership interest, a taxable retail sale in New York?
No -- none of the three restructuring scenarios (contributing property to a new corporation for stock, to a new partnership for a partnership interest, or to a new single-member LLC for a membership i…
Are admission charges for Cirque du Soleil's theatrical acrobatic performances exempt from New York's admissions tax as live circus performances?
Yes, but only because of a brand-new exemption -- effective December 1, 1997, New York expanded its admissions tax exemption to cover live circus performances specifically, not just dramatic or musica…
Are a Web-development company's charges for domain registration, host site maintenance, Web page design, and interactive games -- and its own purchases from programmers -- subject to New York sales and use tax?
No -- none of the Web-development company's charges to its clients (domain and InterNIC registration, passed-through host site maintenance, Web page design, or custom interactive games) are subject to…
Is the per-transaction fee an ATM network operator charges member banks for processing electronic banking transactions subject to New York's tax on telephone service?
No -- the roughly 10-cent per-transaction fee an ATM network operator charges its member banks is not subject to New York's tax on telephony and telegraph service, because the network operator is prov…
Is a waste-management consulting company's fee for auditing, designing, and monitoring a client's waste program -- without ever hauling or disposing of waste itself -- subject to New York sales tax?
No -- receipts from the waste-management consulting company's services are not subject to New York sales tax, because auditing a customer's waste stream, designing a waste-management program, soliciti…
Can a cellular reseller buy phones it later gives away 'free' or at a discount with a service contract tax-free as a purchase for resale, rather than paying tax on the phones upfront?
Yes -- the cellular reseller can buy the phones tax-free as a purchase for resale, using a resale certificate, even though some customers receive the phone for "free" or at a discount as part of a bun…
Is a commercial tenant's 'additional rent' charge for lawn, common-area, and complex maintenance subject to New York sales tax, and can the landlord charge tax only on its mark-up?
The lessor's additional-rent charges for maintaining the areas directly tied to the tenant's own leased premises (adjacent lawn, shrubbery, driveways, parking) are not subject to sales tax, because th…
Are architectural and interior design drawings, specifications, and rental-space plans taxable interior decorating and design services, or are they exempt when performed by a licensed architect or engineer?
It depends on who performs the work and what the drawings are for. Drawings that require a licensed architect's or engineer's certification under the Education Law -- whether drawn personally by the l…
Are membership dues, an initiation fee, and an annual assessment charged by a private yacht club subject to New York's club dues tax?
Yes -- the yacht club's $600 initiation fee, $300 annual dues, and $200 capital-improvement assessment are all subject to sales tax, because the club is formally organized and controlled by its member…
Are membership dues and an initiation fee paid to a recreational boating club subject to New York's club dues tax?
No -- the boating club's $350 initiation fee and $300 annual dues are not subject to sales tax, because the club's material purpose is purely recreational boating and fishing (with no tournaments, con…
Does a company that transports disabled people and developmentally-delayed preschoolers qualify as an omnibus carrier 'in local transit service' eligible for New York's motor fuel, petroleum business, and sales tax refunds?
Partly. The company is an 'omnibus carrier' for the Article 12-A motor fuel tax, Article 13-A petroleum business tax, and Article 28 sales tax, but only some of its fleet is 'in local transit service.…
Can a wholesale supplier accept a resale certificate from a contractor buying materials for capital improvement or repair jobs?
No -- a wholesale supplier cannot accept a resale certificate (Form ST-120) from a contractor buying materials and supplies to use in performing capital improvement work or repairs on real property, b…
Are the film and processing supplies used in coin-operated photo booths exempt from New York sales tax as production supplies?
Yes -- because the amusement park's photo booths develop the customer's own negatives and print the photographs from raw film and chemicals, the whole process counts as manufacturing tangible personal…
Is a soy-based sports-nutrition supplement sold through a multi-level marketing network exempt from New York sales tax as a dietary food?
Yes -- Reliv's "ProVantage" soy-protein sports-nutrition product is exempt from sales tax as a dietary food and health supplement, because its label describes special dietary properties (boosting ener…
Does a car importer owe sales or use tax on vehicles used in a free, six-month test-drive program before they're sold?
XYZ can import and register the vehicles tax-free for resale, but once it lets outside "evaluators" and its own employees drive them under the test-drive program, the vehicles become taxable "mixed-us…
Is equipment used to make both soft-serve and prepackaged ice cream exempt from New York sales tax as production machinery?
It depends on which product the equipment makes -- machinery used more than half the time to produce prepackaged ice cream for sale (like Petitioner's hardening cabinet) can qualify for the production…
Which of a mail house's printing, sorting, inserting, and mailing services for financial-institution statements are subject to New York sales tax?
It splits by service and by destination -- sorting, inserting, sealing, postage/metering, and mailing charges (and reimbursed postal charges) all escape sales tax if separately stated, but the actual …
Can an Industrial Development Agency's leasing subsidiary buy and lease equipment and resell services tax-free through resale certificates on the agency's behalf?
Yes -- Donaldson, Lufkin & Jenrette's Leasing Corp. subsidiary can purchase IDA-Equipment directly as the IDA's agent, lease other equipment and buy installation/maintenance services from third partie…
Can a mechanical contractor buy or rent temporary boilers tax-free for resale when installing them at a customer's building during a boiler replacement job?
Yes -- because Dierks' temporary boilers are installed and operated solely to provide heat and hot water for a building's tenants (not to serve Dierks' own construction work), and Dierks itself never …
Are installation-services payments and computer software acquisitions made through an Industrial Development Agency's disclosed agents exempt from New York sales tax?
Yes, with conditions -- payments by Travelers' disclosed agents for installing IDA-owned equipment, and for acquiring or maintaining computer software (including software delivered electronically or u…
Are a disaster-recovery service's monthly subscription fees and usage fees subject to New York sales tax?
It's split -- Petitioner's monthly subscription fee, which merely grants customers a contingent right to access backup computer equipment if a disaster ever strikes, is a nontaxable sale of an intangi…
Is a law firm's floor-by-floor office reconstruction (including asbestos removal and re-fireproofing) an exempt capital improvement or a taxable repair service?
Mostly exempt -- the wall, HVAC, plumbing, millwork, and fireproofing work on Petitioner's headquarters build-out (including redoing failed fireproofing) qualifies as an exempt capital improvement bec…
When must an equipment finance company remit sales or use tax on its healthcare-equipment fair market value leases versus its conditional sales agreements?
It depends on which type of transaction it is -- under a genuine fair market value (true) lease, DVI must collect sales tax on each monthly rental payment as it's received, but under a conditional sal…
Must a funeral livery service collect New York's 5% special passenger car rental tax, in addition to ordinary sales tax, on its car-and-driver charges to funeral homes?
Yes -- Petitioner is correctly collecting both ordinary New York sales tax and the additional 5% special short-term passenger car rental tax on the fees he charges funeral homes for cars and drivers, …
Is a dual-licensed insurance adjuster and private investigator's fee income taxable as a 'detective service,' or does it depend on which license the work required?
It depends entirely on which hat Petitioner is wearing for a given assignment -- fees for work requiring his independent adjuster's license (investigating and adjusting insurance claims on an insurer'…
Are dues paid to a homeowners association's community center exempt from New York's club dues tax?
Yes -- Community Center of Smallwood qualifies as a homeowners association because its membership is limited to owners of homes within the defined Smallwood community and its social/athletic facilitie…
Are a software vendor's "system utility" data-entry and EDI products taxable as prewritten software, even though each customer's installation must be uniquely programmed to work?
Taxable -- Petitioner's KEY/MASTER and Trading Partner software products are "prewritten computer software" (and therefore taxable tangible personal property) regardless of how heavily each installati…
Is a workplace drug-and-alcohol-testing program administrator's consulting, sample collection, and reporting services subject to New York sales tax?
No -- none of Safe Systems' services (consulting and training on an internal drug/alcohol testing program, writing testing policies, collecting samples via certified technicians, delivering lab report…
Are a pharmacy's printers, toner, and paper used to produce prescription labels and medical information pamphlets exempt from sales tax?
Yes -- because Petitioner's prescription drug labels and accompanying medical information pamphlets are critical elements of the medication product it sells (not just packaging overhead), the toner an…
Is admission to a children's indoor play center exempt from sales tax as a participant sporting activity?
No -- Playspace's admission charge for its indoor children's play center is taxable, because its games, toys, playground equipment, and structured activities like sing-alongs and story times are amuse…
Are a consulting firm's visual-impact studies and reports for environmental-review (NYSEQRA) applications subject to New York sales tax?
No, for the core service -- Company A's reports and digitized photo presentations helping clients meet environmental-review visual impact requirements aren't taxable, regardless of where the site is l…
Is a hotel's separately billed 'booking agent' fee part of the taxable hotel room rent, even when a foreign travel agent pays the room charge and fee separately?
Yes -- the 20-25% fee a hotel's own booking-agent entity charges a foreign travel agent for negotiating discounted room rates is part of the taxable rent for hotel occupancy, because the traveler can'…
Is a rental car company's separately billed 'booking agent' fee part of the taxable rental charge (and subject to the 5% special tax), even when a foreign travel agent pays the fee separately?
Yes -- the roughly 20-25% fee a rental car company's own booking-agent entity charges a foreign travel agent for negotiating discounted weekly rates is part of the taxable passenger car rental charge,…
Is an internet lead-generation company's sale of custom prospect reports to its clients subject to New York sales tax?
No -- "X"'s custom monthly reports of website-generated sales leads, delivered electronically or by mail to each client and billed per lead, aren't subject to sales tax, because each report is persona…
Are the initiation fees, dues, listing fees, and office assessments that local real estate boards charge for operating a multiple listing service subject to New York sales tax?
No, for most of it -- the one-time initiation fees, periodic dues/participation fees, listing fees, and office assessments that a multiple listing service charges participating brokers all escape New …
We're a nonprofit local development corporation that helps finance small-business construction projects through the SBA 504 loan program, using sale/leaseback, installment sale, or lease/leaseback structures where we briefly hold title or a leasehold interest. Are our purchases (or the contractor's purchases as our agent) exempt from sales tax, and is a mortgage where we're named as mortgagee exempt from mortgage recording tax?
Both exemptions are available, but with conditions. Greater Syracuse Business Development Corporation, a Not-For-Profit Local Development Corporation reincorporated under N-PCL § 1411, helps finance s…
Are a medical cost-containment company's case management, utilization review, bill audit, and other services subject to New York sales tax?
Mostly not taxable -- Petitioner's client's field/telephonic case management, first-report filing, utilization management, independent medical exams, peer reviews, hospital bill audits, and Social Sec…
Are a family-run sailboat charter operator's day-cruise fees (including a boxed lunch) subject to New York sales tax?
No -- Petitioner's day-charter sailing excursions on Lake Champlain (including the boxed lunch) are a nontaxable transportation service, not a taxable boat rental, because Petitioner personally retain…
Are a product-testing lab's testing fees, sales of test-swatches, and lab equipment purchases subject to New York sales tax?
It's split by category -- Petitioner's product-testing fees and confidential result reports aren't subject to sales tax at all, but its sales of dust-sebum swatches, soiled fabric, and testing soils t…
Is a chartered ocean-liner business conference held in international waters subject to New York sales tax?
No -- because Richmond Events' entire business-conference program (meetings, meals, accommodations, and use of the ship's facilities) takes place after the chartered ocean liner has left New York Stat…
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These are official tax letter rulings and advisory opinions issued by New York'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.