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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Are a laboratory's materials-testing and R&D reports on unique client samples subject to New York sales tax as an information service?
Not taxable. Although the reports are an information service, each one analyzes a unique client sample and is not incorporated into reports for others, so it is personal or individual in nature and ex…
Before September 1, 1991, did a software marketer owe use tax on the base bank-software it bought from its parent to customize and sub-license to end users?
Yes, on its own purchases. Under the pre-September-1991 rule, the base software the marketer bought before tailoring it to any customer was taxable tangible personal property, so its payments to the d…
Does a machine used to rebuild torque converters qualify for the sales tax production exemption and the Article 9-A investment tax credit?
Yes, both. Rebuilding worn torque converters -- cutting open the old unit, replacing worn parts, and reassembling and testing a finished converter -- is the production of goods by manufacturing or pro…
Is the sale and installation of custom interior window shutters a tax-exempt capital improvement to real property, or a taxable sale?
Taxable. The Department ruled that custom interior window shutters are like blinds and draperies, not a capital improvement, so their sale and installation stays subject to sales tax.
Which pieces of a salt mine's equipment — conveyors, elevators, screening, mining machinery, roof bolts, and power-distribution gear — qualify for New York's production-machinery sales tax exemption?
Conveyors, elevators, screening systems, and salt-mining machinery qualify for the § 1115(a)(12) production exemption. Roof bolts and general power-distribution equipment (substations, transformers, c…
How does New York sales tax apply to an outsourced facilities-management provider's mailroom, printing, copying, fax, filing, delivery, and related services, and to its supplies and equipment?
It varies by service. Printing, copying, imprinting, mailing-list maintenance, fax, and sales of copies or supplies are taxable; pure clerical, mailing, shipping, delivery, filing, and messenger servi…
In the modified opinion, are an asbestos contractor's plastic bags and poly taxable, and what changes when the removal is part of a capital improvement?
Same core result as the original opinion — disposal bags are 'actually transferred' (not taxable) and plastic poly is consumed by the contractor (taxable) — but this modified opinion adds that when th…
Is a contractor's operation and maintenance of cogeneration plants built with industrial-development-agency financing exempt from sales tax as government activity?
Operating the plant isn't exempt government activity, and because the contractor bills one lump-sum operation-and-maintenance fee without separating taxable from nontaxable charges, it must collect ta…
When a retailer sells discounted cellphones to customers who also sign a carrier service contract, are the phones taxable 'promotional items' the retailer can't buy for resale?
The phones are purchased for resale, not promotional items. Because the retailer sells the phones (bundled with service) at a profit rather than giving them away or selling below cost, it buys them ta…
Must a private homeowner collect sales tax on the rent when a guest pays to stay in the home during a special event like the 1993 World University Games?
No. A private home not regularly used for lodging guests isn't a 'hotel,' so short-term paid stays during the event aren't subject to New York's hotel occupancy sales tax.
In an outsourced copy-service arrangement, who owes sales tax on the copies, on the toner and paper, on outsourced repairs, and on copier lease payments?
Charging by the copy is a taxable sale of tangible personal property. The provider buys toner and paper for resale (ST-120), and can pass through outsourced repairs tax-free only if separately stated;…
Are a county fire district officers association's purchases of goods and services exempt from New York sales and use tax as a state instrumentality?
Exempt. The Department held the association is an instrumentality of New York State under Tax Law § 1116(a)(1), so its purchases of tangible personal property and services are exempt from state and lo…
Are a fire district officers association's purchases of goods and services exempt from New York sales and use tax as a state instrumentality?
Exempt. The Department held the association is an instrumentality of New York State under Tax Law § 1116(a)(1), so its purchases of tangible personal property and services are exempt from state and lo…
Are wheelchair lifts, stairway lifts, pool lifts, and disability-operated power door openers exempt from New York sales tax as artificial devices, and is their installation taxable?
Exempt. Wheelchair lifts, stairway lifts, pool lifts, and power door openers operated only by disability controls are artificial devices exempt under § 1115(a)(4), and their installation and repair ar…
Is removing an old lighting system and installing a new hardwired energy-efficient one a capital improvement, so the contractor doesn't charge the customer sales tax?
Yes. Installing a new, permanently hardwired energy-efficient lighting system is a capital improvement, so the contractor doesn't charge the customer sales tax (with Form ST-124) — but the contractor …
For a maid service, are apartment cleaning, laundry, laundry-cost reimbursement, and travel charges each subject to New York sales tax?
Apartment cleaning is taxable real-property maintenance; separate laundry charges and laundry-cost reimbursements are not taxable; but travel charges are fully taxable because they can't be split betw…
Are homeowners association dues subject to sales tax when the HOA has recreational facilities, no facilities, or spins the facilities into a separate corporation?
If the HOA owns recreational facilities, its whole mandatory assessment is taxable club dues — you can't carve out the small recreation share. An HOA with no recreational facilities isn't taxed. Split…
Does a tennis club collect sales tax on a required purchase of the landholding company's stock, and can members get that tax refunded when the stock is redeemed?
Taxable. A share purchase required as a condition of membership is both taxable dues and an initiation fee under § 1105(f)(2), so the club collects tax on it. Redeeming the stock later gives no refund…
Does a grocery's larger 'Advantage Shelf Tag' adequately disclose a manufacturer's coupon reimbursement in an electronic (paperless) coupon system?
Yes. The larger, differently-colored 'Advantage Shelf Tag' substantially as described meets the manufacturer-reimbursement disclosure requirement, even in a paperless coupon system — but a plain shelf…
Is a bio-absorbable dental tissue-regeneration device sold to dentists exempt from New York sales tax as a prosthetic aid or a medical supply?
It's a medical supply under § 1115(a)(3), not a prosthetic aid. That means it's taxable when bought by a dentist for use in providing dental services for compensation, but exempt when sold to a § 1116…
Does an elevator company owe use tax on materials it uses in taxable maintenance and repair jobs, and can it recover that tax?
Elevator maintenance and repair is taxable on the full invoice price (unless it's a capital improvement). The company can claim a refund or credit for tax paid on materials that become part of the ser…
Does an aircraft-rental company pay sales tax on fuel it pumps into planes for 'wet' rentals, and can it recover that tax?
The lessor must pay sales tax on fuel at the pump even though it's bought for resale, but can then claim a credit (on the FF schedule, Form ST-100.10) against the tax it collects on the wet rental. Fu…
Are a country club's membership fees and dues taxable when membership is by invitation only and restricted to a defined group?
Yes. Because the club restricts membership by invitation only — an attempt at exclusivity beyond mere facility size — it's a taxable 'social or athletic club,' so its fees and dues are subject to sale…
Can a trash-removal company buy portable compactors tax-free for resale when it supplies them to customers as part of its trash-removal service?
No. Because the hauler and its customer both use the compactors as part of one bundled trash-removal service, the compactors aren't purchased for resale — so the hauler owes sales tax on buying them, …
Are golf country club membership dues and initiation fees taxable when members have no control, no proprietary interest, and membership is limited only by the size of the facility?
No. Because members won't control the club, won't hold a proprietary interest, and membership is limited only by the physical size of the facility (not exclusivity), the club isn't a taxable 'social o…
Is a subcontractor's charge to erect tubular scaffolding or pipe framing for a building renovation subject to New York sales tax?
Yes. A subcontractor's charge to erect tubular scaffolding or pipe framing is subject to New York State and local sales tax. Scaffolding is not a tax-exempt 'temporary facility' — and it's taxable whe…
Are a company's labor and material charges to close its portion of a town-owned landfill subject to New York sales and use tax?
No. Closing the landfill is a capital improvement, so the labor charges aren't taxable; and because the materials become an integral part of the exempt Town of Wilna's land, the materials aren't taxab…
Is a manufacturer's rebate that a car lessee assigns to the dealer as a 'capitalized cost reduction' still part of the taxable receipt on the lease?
Yes. A rebate the car manufacturer pays you and that you sign over to the dealer as a 'capitalized cost reduction' does not shrink what you owe the dealer, so it stays part of the taxable lease receip…
Does an off-campus pizzeria owe sales tax on food it delivers to college students under a campus meal-plan voucher system?
Yes. The student meal-plan exclusion only covers food sold at a restaurant located on the college's premises. An off-campus pizzeria delivering to students — even under the campus voucher plan — isn't…
Is a company's service of testing computer circuits taxable when the circuits will be assembled into products held for resale?
No — not taxable here. Testing computer circuits is a taxable service on tangible personal property, but because the circuits will be assembled into products held for resale, the testing isn't taxed, …
Is a warehouse club's annual membership fee subject to sales tax when it buys members access to lower merchandise prices?
Yes. Because the club's low prices are funded by the membership fee, the fee is in substance a prepayment for the merchandise members buy, so it's taxable under Tax Law 1105(a) — not treated as tax-fr…
Are an asbestos-removal contractor's purchases of plastic disposal bags and plastic wall/floor poly taxable when the work is done for tax-exempt property owners?
The plastic disposal bags are 'actually transferred' to the customer along with the asbestos, so buying them isn't taxable; but the plastic poly used to seal walls and floors is consumed by the contra…
In a paperless electronic-coupon system, how must a grocer disclose a manufacturer's coupon so tax is figured on the reduced price?
The grocer must show the item is a manufacturer's coupon item by marking 'MFG'/'M' on manufacturer coupons in its in-store circulars and newspaper inserts. An 'MFG'/'M' code on the shelf label alone d…
Is a caterer's separately stated 18% 'service charge' taxable, or is it an exempt gratuity?
Taxable. A caterer's 18% 'service charge' is part of the taxable receipt because it isn't designated a gratuity (the menu even says it isn't) and it's really the staff's wages — and wages can't be ded…
Must a national fraternity's parent organization collect sales tax when it sells pins, cards, and supplies to its chapters and members?
Yes. When the parent organization sells items like ID cards, pins, and supplies to chapters or members, those are retail sales — it buys them tax-free for resale but must collect sales tax on the sale…
Is replacing an underground fuel oil storage tank a nontaxable capital improvement, even though it can eventually be taken out of service?
Yes. Installing a replacement underground fuel oil tank — poured on a concrete slab, buried, and asphalted — is a capital improvement, so the work isn't taxable. No local law forces its removal when o…
Is a one-time sale of the right to reproduce a photograph subject to sales tax, and what about buying the photograph outright?
Selling the one-time right to reproduce a photograph is not taxable — it's treated as a royalty, and the customer only takes temporary custody. But buying the photograph outright from the photographer…
Does a veterinary clinic collect sales tax on pet food and pet supplies, and what about grooming — given the special veterinarian tax rules?
A veterinarian pays sales tax when it buys pet food, supplies, and medicine, and does not collect tax when it resells those animal-care items to customers. But grooming is a taxable service, so the cl…
Does a company that arranges repair and maintenance work through subcontractors and bills customers a marked-up price owe sales tax on its charges?
Yes. A company that contracts to have repair and maintenance done, subcontracts the actual work, and bills the customer a marked-up price is acting as a prime contractor. Under Tax Law § 1105(c)(5) an…
Does a tenant owe sales tax on removing and replacing fuel tanks when the property is leased from a state agency and title to the improvements vests in that agency?
No tax is due. Because the tenant leased the site from the New York State Department of Transportation — an exempt agency under Tax Law § 1116(a)(1) — and title to the tanks vested in the Department u…
Is a discounted group-sales amusement-park ticket taxable when admission is called 'free,' and is installing a fiberglass tubeslide a nontaxable capital improvement?
The whole group ticket is taxable unless it separately states admission and rides. An amusement park's ride charges escape tax only when its pay-one-price ticket separately states the taxable admissio…
Does the owner of an aircraft owe sales tax on the monthly rent it charges a lessee, when the owner did not obtain a resale certificate showing the lessee re-rented the plane?
The owner owes the tax unless it can prove otherwise. Leasing an aircraft is a retail sale of tangible personal property, taxable under Tax Law § 1105(a). The rent is exempt only if the owner obtained…
Is a New York vendor relieved of its duty to collect sales tax if it accepts, in good faith, a properly completed exemption certificate from the customer?
Yes. A New York vendor that takes a properly completed exemption certificate from its customer in good faith — with no knowledge it is false — is relieved of the duty to collect sales tax on that tran…
Does a detective agency's shopping service owe sales tax on merchandise returned for full reimbursement and on the shipping charges for those returns?
The reimbursement for returned merchandise is not taxable — it's treated as a cancelled sale. The shopping service itself is a taxable protective and detective service under Tax Law § 1105(c)(8), and …
Are sales of a licensed software product taxable when the maker embeds each customer's settings and identity into an otherwise standard program?
Yes, and generally the whole charge is taxable. The Fenics option-pricing program is pre-written software that the maker modifies to each purchaser (embedding time zone, base currency, and the custome…
Are public relations services subject to New York sales or use tax?
No. Public relations services are not on New York's list of taxable enumerated services under Tax Law § 1105(c), so a PR firm's charges are not subject to sales or use tax — as long as no tangible per…
Is a custom telephone-survey marketing research report a taxable information service, or is it exempt as personal or individual to the client?
It is exempt. Collecting, compiling, and analyzing information and furnishing reports is normally a taxable information service under Tax Law § 1105(c)(1). But this marketing research qualifies for th…
Are a golf and country club's dues taxable when members have no proprietary interest or control and membership is limited only by facility size, and what about locker and food charges?
The dues are not taxable. Because members have no proprietary interest, no control over the club's activities or management, and membership is limited only by the size of the facilities (not by exclus…
Are marketing consultation services subject to New York sales or use tax?
No. Marketing consultation — advising a company on its marketing efforts, writing a marketing plan, drafting questionnaires and scripts, and reviewing sales literature — is not one of New York's taxab…
Is a 'marking service' — attaching price tickets to merchandise — a taxable enumerated service, and is it exempt as work on goods held for sale?
It is taxable. A 'marking service' — attaching price-ticket labels to garments and other merchandise — is one of the enumerated services taxed under Tax Law § 1105(c). And it can't be purchased for re…
Does a builder owe sales tax on factory manufactured homes it buys, and does it matter who hires and pays the crane crew that sets the home on the foundation?
It depends on who arranged the installation. An uninstalled factory manufactured home is taxable tangible personal property, but a home sold with installation as a component of the sale (a capital imp…
Is developing and maintaining a database of a client's own membership data a nontaxable information service, or a taxable sale of tangible personal property?
It is a taxable sale of tangible personal property. Building and maintaining a computer database from a client's own membership data and returning it on floppy disks or computer reports merely convert…
Does a dissolvable corneal collagen shield used after eye surgery qualify for New York's sales-tax exemption for medical supplies?
Yes, as a medical supply. A corneal collagen shield — placed in the eye after surgery and absorbed within about a day — is not a drug or medicine but qualifies as an exempt medical supply under Tax La…
Are writing and editorial services to produce an annual membership directory taxable, or is the directory manuscript intangible and exempt?
The writing and editorial charges are not taxable. An original manuscript — here, the annual membership directory ('Service Guide') a firm writes and edits — is intangible personal property, not tangi…
Are personalized behavioral-analysis reports on an individual a taxable information service, or are they exempt as personal or individual in nature?
They are exempt. Preparing reports on a particular individual's behavioral tendencies from a questionnaire the customer completes is an information service that qualifies for the 'personal or individu…
Is admission to a 'Haunted Hayride' exempt from sales tax as a dramatic performance, or taxable as admission to a place of amusement?
It's taxable. Admission to a 'Haunted Hayride' — a haywagon tour past twenty or more short, one-to-two-minute costumed horror scenes — is a taxable admission charge to a place of amusement under Tax L…
Must an out-of-state seller that also has New York stores collect NY sales tax on goods it ships by common carrier from out-of-state warehouses to New York customers?
Yes. A company that maintains offices and retail stores in New York must collect New York State and local sales and use tax on merchandise it sells and ships to New York customers by common carrier fr…
For sales before September 1991, were a firm's custom software, stock-pricing service, and trade-confirmation reports subject to New York sales tax?
It depends on the item. For the audit period (Sept. 1, 1988 to Aug. 31, 1991): custom software written for one customer's specific computer environment was treated as intangible property, so its sale …
Can a trash-removal company buy the containers it rents to customers tax-free as a purchase for resale?
No. A trash-removal company cannot buy its trash containers exempt as a purchase for resale, even when it separately states a container rental charge on the customer's bill. Under Tax Law § 1105(a) an…
Are a company's charges for letting a medical practice use its leased MRI machine a taxable rental of equipment, or a nontaxable service?
Yes — the charges are a taxable rental of equipment. Where a company subleases an MRI system to a professional corporation (PC) and the PC's own technicians operate the machine and direct its use — wh…
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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.