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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Is the sale of flat-rate Internet access subscription services to New York customers subject to New York sales and use tax or the section 186-e telecommunications excise tax?
No. Under the Department's Internet policy effective February 1, 1997, Internet access charges are an unenumerated service that is not subject to New York State and local sales and use taxes (Articles…
Are a patent draftsman's formal drawings sold to patent attorneys subject to New York sales tax?
Yes -- Peter Cotsis's formal patent drawings, sold to patent attorneys for submission with patent applications, are tangible personal property subject to sales tax, because his drafting service isn't …
Is a special assessment that a country club charges members to build a safety tunnel subject to New York's club dues tax?
Yes -- even though the tunnel Mount Kisco Country Club built under a state highway is a genuine capital improvement built for members' safety, the special assessment the club charged members to fund i…
Which items a plumbing supplier sells to contractors working for tax-exempt organizations are exempt from New York sales tax as building materials, and which stay taxable as contractor supplies?
It splits item by item -- materials that physically become part of the exempt organization's building, like flux, solder, pipe joint compounds, Teflon tape, PVC cement and primer, oakum, and lead used…
Is custom bank-interface software still taxable as "prewritten" if the developer reuses some prewritten subroutines, like a standard print routine, inside an otherwise custom program?
It depends on how the prewritten pieces are used: if the developer's prewritten subroutines (like a standard print routine) are merely incidental to writing an otherwise custom, start-to-finish progra…
Does New York sales tax apply to a public relations firm's satellite media tour coordination fees, its purchases of studio time and crew, and its website maintenance service?
Mostly not taxable, but it splits by item: coordinating satellite media tours and speaking tours, consulting, scripting, and website maintenance are all nontaxable services, but studio and camera rent…
Are a Web design agency's web-site development, media placement/advertising, ad-network, and site-tracking consulting services subject to New York sales tax?
No -- an "Interactive Advertising Agency"'s from-scratch web-site development (design plus programming), traditional advertising and web-site-network media placement services (as long as no tangible p…
Are a business-cycle forecasting firm's monthly research publications exempt from New York sales tax as periodicals, and is its related consulting service taxable?
Yes -- the firm's two monthly newsletters qualify as exempt periodicals because they're published at regular intervals, don't amount to a book, are open to public subscription, and carry ongoing artic…
Is designing customized web pages and placing them on the Internet subject to New York sales tax?
No -- designing customized web pages and placing them on the Internet isn't one of New York's enumerated taxable services, so the charge is untaxed as long as no tangible personal property is sold alo…
Is a can/bottle recycler's pickup service taxable as real-property maintenance, and do its can-sorting machines and electrical transformer qualify for the production-equipment sales tax exemption?
All three ways: the recycler's container-pickup and recycling service isn't taxable real-property maintenance, its can-sorting machines qualify for the production-equipment exemption because they hand…
When a hotel leases both the building and its furniture from its landlord, is the portion of the rent allocated to the furniture subject to New York sales tax?
Yes -- when a hotel leases a building together with beds, dressers, tables, and chairs, the portion of the lease payments reasonably allocable to that furniture is subject to New York sales and use ta…
How are affiliated companies providing telephone answering services, paging airtime, and equipment rentals taxed under the franchise, telecommunications excise, and sales taxes?
A telephone answering service company is a general business taxed under Article 9-A, not as a telephone business. A paging common carrier is principally engaged in a telephone business taxed under sec…
Does a tax-exempt historical society have to collect sales tax on items it sells through a local store, a card table, and word-of-mouth from members' homes?
It splits by sales channel -- a tax-exempt organization's regular, ongoing sales of merchandise through a fixed "candy store" and thrift shop display are taxable because those count as a "shop or stor…
Is an early Internet "presence provider"'s web page development service subject to New York sales tax?
No -- receipts from an Internet "presence provider"'s Web page development services, including passed-through hosting fees, aren't subject to New York sales tax, both because web page development isn'…
Does a New Jersey company owe New York compensating use tax on free advertising cash-register tapes it manufactures in New Jersey and gives away to New York supermarkets?
Yes -- Cadett Register Tapes owes New York compensating use tax on the free, advertising-printed cash register tapes it distributes to New York supermarkets, because giving away promotional materials …
Can a waste-transfer-station operator buy a competitor's trash-hauling service tax-free for resale when that competitor also uses the same transfer station for its own customers' trash?
No -- the charge Paper Fibres pays Browning Ferris Industries (B.F.I.) to haul all the consolidated waste from Paper Fibres' own transfer station to a Pennsylvania landfill is a separate taxable trash…
Can a foreign diplomatic mission use its U.S. State Department tax exemption card to book a hotel room tax-free in New York if payment is made by the mission's check, the mission's credit card, or a credit card in the name of the mission's home government?
Yes -- a foreign mission holding a valid U.S. Department of State Mission Tax Exemption Card covering hotel room taxes can rent hotel rooms exempt from New York sales tax when payment is made by the m…
Are the flat monthly fees an internet service provider charges customers for internet access subject to New York state and local sales tax?
Starting February 1, 1997, flat monthly fees an internet service provider charges for internet access are not subject to New York state and local sales tax, including bundled amenities like navigation…
Can a New York City Industrial Development Agency sale-leaseback structure let PaineWebber buy and lease office build-out improvements and equipment sales-tax-free by having its agents purchase everything on the IDA's behalf?
Yes, with conditions -- the New York City Industrial Development Agency's proposed sale-leaseback structure for PaineWebber's office build-out ("Tenant Improvements") and equipment/software ("Project …
Does sales tax apply to a convention center's charges for additional electrical, telephone, and plumbing hookups ordered by trade show exhibitors and managers on top of its basic license fee?
No -- the Javits Convention Center's charges for additional electrical, telephone, and plumbing services ordered by show managers and exhibitors on top of its basic utilities aren't subject to sales t…
When a customer pays for an equipment maintenance contract in monthly or quarterly installments instead of all at once, does the seller collect sales tax on each installment or on the full contract price up front?
The full sales tax is due on the entire contract price at the time the maintenance agreement is signed, regardless of whether the customer is allowed to pay in installments over the contract term, bec…
Are anti-theft sensor labels sold to manufacturers and retailers exempt from New York sales tax as sales for resale or as packaging material?
It depends who buys them -- loss-prevention labels sold to manufacturers, who place them inside a product's packaging and resell the labeled product, qualify for the resale exemption with a resale cer…
Is a kitchen and bathroom renovation company that controls the whole job but has its customers separately sign contracts with the installing tradespeople a retailer of the cabinets it sells, or a contractor performing a capital improvement?
The renovation firm is a contractor, not a retailer -- because it controls every aspect of the renovation (design, pricing, and which tradespeople the customer must use), it must pay sales tax itself …
Can a lawn care company buy the mixer drums, pumps, pulleys, chains and engine parts it uses to blend its own fertilizer tax-free as production machinery and equipment?
No -- a lawn care company's mixer drums, pumps, pulleys, chains and vehicle engine parts used to blend fertilizer are subject to sales and use tax (and so are repairs to them), because the fertilizer …
How does New York sales tax apply to a company that thermally treats and recycles contaminated soil -- on the processing charge, on transportation, on the treatment equipment and fuel, and on any reclaimed soil it later sells?
A company that thermally treats and recycles contaminated soil is performing a taxable processing service under Tax Law § 1105(c)(2) (not exempt waste removal), taxed on the full contract price includ…
Are membership dues taxable as club dues when a golf and country club sells memberships to the general public on a first-come, first-served basis with no proprietary rights or membership control?
No -- dues paid by members of a golf and country club are not subject to New York sales tax as club dues, because nonequity members hold no proprietary interest in the club, have no vote or control ov…
Is a company's telephone verification of a mortgage applicant's job, income and landlord references a taxable investigation service under New York sales tax?
No -- a company's mortgage loan verification service, which consists of telephone interviews confirming a specific applicant's employment, income and other facts at the time of the loan application, i…
Does a weekly investment research subscription that mixes stock ratings data with analytical articles qualify as an exempt periodical under New York sales tax?
Yes -- The Value Line Investment Survey, a weekly subscription publication combining stock ratings data with analytical articles by different authors, qualifies as an exempt periodical under Tax Law §…
Can a textile manufacturer buy the artwork and design mechanicals it uses to silkscreen or weave patterns into its products tax-free under the production exemption?
Yes -- artwork and design mechanicals a textile manufacturer buys and uses directly to silkscreen or weave patterns into products it manufactures for sale qualify for the production machinery and equi…
When a membership warehouse club sells to a nonprofit or government member, what exemption paperwork does it need, and is it responsible for policing whether the member stays a valid exempt organization?
A membership warehouse club can make tax-exempt sales to its Business members that are exempt organizations if it accepts a properly completed exemption certification in good faith and the purchase is…
Does a Canadian mail-order company have to collect New York sales tax when it uses a New York mailing address for orders and drives its own trucks across the border to mail products to New York customers?
Yes -- a Canadian mail-order company that advertises a New York mailing address for customer orders and payments, and uses its own trucks to bring products across the border into New York for mailing …
Is a state-certified inspector's fee for testing medical and dental x-ray equipment for mandatory safety-code compliance subject to New York sales tax?
No -- a certified radiation equipment safety officer's fees for inspecting medical and dental x-ray equipment are not subject to sales tax when the inspections are performed solely to demonstrate comp…
Are stair lifts, patient lifts, home elevators and dumbwaiters sold to help disabled people exempt from New York sales tax as medical equipment or prosthetic aids?
Portable stair lifts, evacuation devices, and patient lifts sold to help disabled people are exempt from New York sales tax as medical equipment or prosthetic aids; residential elevators installed for…
Which of a multi-level marketer's nutritional powders, bars and drink mixes are exempt food or health supplements versus taxable beverages under New York sales tax?
Eight of a multi-level marketer's nine dietary and nutritional products (weight-management supplements, protein/vitamin powders, fruit bars, and joint-support and antioxidant powders) are exempt from …
Is a background-check company's resume-verification service, which digs into a job applicant's education, employment, credit and government records, a taxable detective service under New York sales tax?
Yes -- a company's resume verification service, which investigates a job applicant's educational records, employment history, government records, credit history, and personal references (including int…
Is Rogaine exempt from New York sales tax now that it's sold over-the-counter without a prescription?
Yes -- receipts from the sale of Rogaine remain exempt from New York sales tax as a product for the preservation of health, even after the FDA's 1996 approval of its over-the-counter sale, because New…
Is a large multi-task garage waterproofing and restoration project a nontaxable capital improvement, or a taxable repair, when some individual tasks look like ordinary maintenance?
A large garage waterproofing and restoration project -- covering roof deck waterproofing, structural steel and concrete work, asphalt paving, walkway replacement, railings and other tasks across nine …
Which parts of a print-and-mail company's letter-printing and mailing service are taxable printing versus exempt mailing, and does the tax rate depend on where the letters are mailed to?
A company that prints and mails specialized notices and letters must charge sales tax on its printing of letters, envelopes and address labels (taxable under the printing/imprinting rules), but not on…
How does New York sales tax apply to the many different services and equipment rentals an executive office suite provider bills to its tenants -- phone answering, copying, word processing, mail handling, catering, and pass-through charges?
An executive office suite operator's tenant services are taxed item-by-item depending on their end result: telephone answering and equipment-based copying/faxing are taxable, word processing is not, e…
When an unredeemed towed vehicle is sold at a New York City Marshal's auction, are the towing charges paid to the towing company out of the auction proceeds subject to sales tax?
No -- towing charges that a New York City Marshal pays to a towing company out of the proceeds of an unredeemed vehicle sold at a Marshal's auction are not subject to sales tax, because the Marshal pu…
Is a check-guarantee service's per-check fee, which merchants pay to have a customer's check backed against non-payment, subject to New York sales tax?
No -- a check guarantee service's fees, including its per-check charge and its minimum monthly account fee for low-volume merchants, are not subject to New York State or New York City sales tax, becau…
Who has to collect New York sales tax on towing charges and vehicle auction sales when a New York City Marshal tows away cars for unpaid parking tickets -- the Marshal or the independent towing company?
The New York City Marshal, not the independent towing company, must collect and remit sales tax on towing charges paid by a vehicle owner reclaiming a car towed under the Parking Violations Bureau pro…
Is admission to a sports card and memorabilia show, the vendor table fees, and autograph sales all subject to New York sales tax?
Admission to a sports card and memorabilia show and the fee charged to vendors for table space are not subject to New York sales tax, but a promoter must collect sales tax on autographed products it s…
Is artwork a fabric manufacturer buys and scans to design a computer-generated weaving blueprint for upholstery fabric exempt from New York sales tax as production equipment?
Yes -- artwork a textile manufacturer purchases and scans into a computer to design a weaving blueprint for upholstery fabric qualifies for New York's Statewide production machinery and equipment exem…
Is an integrated CAD/CAM/CAE computer system used both to develop generic product designs and to configure specific customer orders exempt from New York sales tax as research and development or production equipment?
A fully integrated CAD/CAM/CAE hardware, software and maintenance system qualifies for the research and development exemption when used to create documented, generic marketable product designs, and se…
Is a drugstore's free monthly newsletter for senior customers exempt from sales tax as a periodical or shopping paper, or is its cost a taxable purchase by the store?
No -- a drugstore's free monthly newsletter for senior customers is not exempt from sales tax, because giving a publication away free for promotional purposes is a taxable retail purchase by the store…
Are dues paid to a private beach club association that's limited to residents of a specific housing development exempt from sales tax as a homeowners association?
Yes -- dues and initiation fees paid to a private beach club association whose membership is limited to residents of a defined housing development, and which operates recreational facilities (a pool, …
Is a loss-consulting firm's investigative reports, built from subcontracted private investigators and other experts, subject to sales tax as protective and detective services?
Yes -- a loss-consulting firm's investigative reports built from surveillance and background-investigation work by subcontracted private investigators and other experts are taxable protective and dete…
Is hiring a trucking company to haul asphalt to a paving job a nontaxable transportation service, or a taxable equipment rental?
Hiring a trucking company to pick up and deliver asphalt to a paving job site -- where the trucking company supplies its own truck and driver, chooses its own routes, pays all operating expenses, and …
Do league fees paid to a nonprofit that organizes recreational softball, volleyball, and table tennis leagues count as taxable 'club dues'?
No -- league fees paid by teams to a nonprofit that runs open, non-exclusive softball, volleyball, and table tennis leagues aren't subject to the club dues sales tax, because the members have no propr…
Is a utility's fee for operating a building's heating, air conditioning, and electric generating equipment on the owner's behalf subject to sales tax?
Yes -- when a company operates and monitors a building's boilers, air conditioning units, and electric generators on the building owner's behalf (turning them on and off, adjusting them, and logging t…
Does a New York social/athletic club have to collect sales tax on dues paid by members who live outside New York?
Yes -- a social or athletic club based in New York must collect sales tax on membership dues from every member over $10/year, regardless of whether the member lives in New York or another state, becau…
Once a homeowners association acquires a swimming pool and tennis courts for its members, does any part of its monthly association fee become subject to the club dues sales tax?
No -- because this is a homeowners association whose membership is limited to owners and residents of homes in a defined development, its monthly association fee stays entirely outside the club dues s…
Does a graphics design firm have to collect sales tax on the brochures, logos, and marketing materials it designs and delivers to clients on a computer disk?
It depends on what's actually being sold: if the invoice and agreement clearly state the client is buying only reproduction rights (not ownership) and the computer disk is transferred solely so the cl…
Does a videographer have to charge sales tax on video tape copies sold to a town board, a church, or a wedding couple?
A videographer who tapes town board meetings, church services, and weddings, then sells a copy to the purchaser, doesn't owe sales tax on copies sold to a town or other government entity (with a purch…
When a commercial landlord charges tenants for 'condenser water' used to run their air conditioning, is that a taxable utility sale or an untaxed part of the rental?
No -- a commercial building owner's charge to tenants for 'condenser water' (the water circulated through a building's central air conditioning system) is not a taxable sale of water or a refrigeratio…
How are an out-of-state natural-gas marketer's sales to New York end-users taxed under the Article 9 utility taxes, Article 9-A, and the sales tax, when title passes outside New York and the marketer arranges transportation as the customer's agent?
A natural-gas marketer deriving more than 50% of its receipts from gas sales is classified under Article 9: it is subject to the section 186 gross-earnings tax (so not Article 9-A, per section 209.4) …
Which parts of a 'turn-key' trade-show company's design, fabrication, rental, shipping, storage, and project-management charges are subject to New York sales tax?
A New York-based 'turn-key' trade show company's rentals and occasional sales of exhibits and displays (bundled with design, fabrication, and shipping charges) are taxable when delivered in New York a…
Does an out-of-state manufacturer have to register and collect New York sales tax if its only New York contact is an occasional trade show demo and orders shipped by mail or common carrier?
No -- a Rhode Island manufacturer with no New York place of business or property, no New York sales staff or agents, only an occasional (once-every-other-year) New York trade show appearance where pro…
Is a wedge-shaped foam bed pillow marketed to control acid reflux exempt from sales tax as medical equipment?
A specialized wedge-shaped foam 'Bed Pillow' recommended by physicians to control acid reflux, if not generally useful absent illness or injury, qualifies as exempt medical equipment when sold directl…
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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.