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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Does a bed-and-breakfast reservation service that books rooms for travelers have to collect sales tax on its charges?
No — the booking agency itself need not collect sales tax, but the hosts must. Bed & Breakfast U.S.A. lists available bed-and-breakfast homes ('hosts') for travelers ('guests'), makes reservations, ta…
Is machinery a scrap-metal recycler buys to process scrap into resalable material exempt from sales tax?
Partly. C & H Salvage Corp. asked whether machinery used strictly in recycling scrap metals is taxable. Processing scrap metal for sale is 'processing' under Tax Law § 1115(a)(12), so machinery used d…
A utility's customers on public assistance have their bills ultimately paid by a social services agency. Is that an exempt sale to the government?
No — these ordinary public-assistance sales are taxable. Consolidated Edison serves customers on public assistance whose monthly utility bills are ultimately paid by the New York City Human Resources …
Are aerial maps, surveys, and charts a tax-exempt information service, or are they taxable tangible personal property?
They are taxable tangible personal property. Lockwood Support Services makes aerial maps, surveys, and charts and argued they are an exempt information service under Tax Law § 1105(c)(1). The Departme…
How is sales or use tax charged when someone buys a mobile home and installs it permanently on New York land — and does living out of state change it?
It turns on new-vs-used, where it's bought, and the buyer's residence. Elsa and Carlos Rosa, New Jersey residents, planned to buy a mobile home and install it permanently on their land in Bethel, New …
Is building a ski lift a tax-exempt capital improvement to real property, or a taxable installation of equipment?
It splits. Peek 'n Peak Recreation asked whether building a ski lift at its resort is an exempt capital improvement to real property. The Department held it is not, except for the foundations. A capit…
Can a broadcaster allocate the sales tax on its production purchases based on where its viewers are, since the audience is in and out of New York?
No. Showtime Entertainment prepares videotape programs for satellite broadcast and asked whether the sales and use tax on its purchases of tangible personal property, editing/dubbing processing servic…
Can a pay-per-view movie company take over the hotel's responsibility to collect and pay the sales tax on in-room movie charges?
No. Spectradyne installs and maintains pay-per-view movie equipment ('Spectravision') in hotels and asked whether it could assume the hotel operator's liability to remit the sales tax collected on in-…
Are the fees a health club charges for aerobics classes and workout machines taxable as club dues or admission charges?
No. Donald B. Schwartz asked whether the fees a 'health club' charges — for aerobic exercise classes and the use of workout machines by dues-paying members, with showers but no pool — are taxable unde…
Can a caterer buy paper cups, napkins, tablecloths, and plastic tableware tax-free as items bought for resale?
Only partly. Festive Caterers Inc. asked whether its purchases of paper cups, napkins, tablecloths, and plastic tableware are exempt as items bought for resale because they become part of a customer's…
A typesetter sells imprinted film used to print catalogs. Is that a taxable sale of property or an exempt typesetting service?
It is a taxable sale of property unless the buyer certifies an exempt use. Stibo Datagraphics, a commercial typesetter, produces imprinted film used by printers to make catalogs and sells the film dir…
Is installing a home water distillation unit a tax-free capital improvement, and how are the sale and installation taxed?
Yes — it is a capital improvement. Alfred E. Luckette Jr. (Alfran Modern Home Products) asked whether selling and installing a home water distillation unit is a capital improvement to real property. T…
Is a market-research firm's sale of customized retail sales and inventory reports a taxable information service?
Yes. Putnam Associates sells reports charting inventory levels and sales of retail products (cosmetics, fragrances, dinnerware) in nationwide stores, and argued it provides a consulting service furnis…
How is a car dealer taxed on vehicles it loans to customers as courtesy cars, especially if it depreciates them as business assets?
It depends on how the dealer holds and uses the cars. Crestview Cadillac loans courtesy cars to customers whose vehicles are being serviced and asked how they are taxed. The Department explained the d…
Is installing in-ground water pipe to a property a tax-free capital improvement?
Yes. Thompson's Mobile Manor, a trailer park, hired a contractor to install in-ground water pipe from the existing main line to and throughout the park (the pipe becomes town property once installed).…
When a syndicate sends newspapers photocopies of a comic strip to publish, is it selling a reproduction right or taxable property?
It is a taxable sale of tangible personal property — not a tax-free reproduction right. The Hearst Corporation's King Features Syndicate mails newspapers photocopies of six daily installments of a com…
Is adding to a warehouse conveyor system a tax-free capital improvement if the conveyor can be removed without damaging the building?
No. McKesson Drug Company asked whether an addition to its existing warehouse conveyor system is a capital improvement excluded from sales tax. The addition is welded and bolted to the building, engin…
When an affiliate produces computer reports for a company, who owes sales tax on the paper — and does it depend on whether the reports are taxable?
It turns on whether the reports are a taxable information service. Norstar Leasing asked whether it owes sales tax on computer printout paper it receives, as reports, from its affiliate Data Company, …
Does a direct-mail company owe sales tax on the mailing lists it rents, or can it claim an exemption?
The mailing lists remain taxable; no exemption applies. The D.M. Group, a direct-mail firm, rents mailing lists (as electronic tapes or gummed labels) to distribute promotional material it produces fo…
Does someone owe sales tax when a corporation gives them a car for free, with no money or other consideration changing hands?
No — a genuine gift of a car is not taxed, but you must document it. Richard W. Scott asked whether he would owe sales tax on a 1984 Chevrolet Suburban that his son and daughter-in-law's corporation w…
If a lessee gives an exemption certificate to the leasing company, does that same certificate also cover an affiliate that later takes over billing and collection?
No — the assignee needs its own certificate. Norstar Leasing leases tangible personal property, then may assign the lease to an affiliate ('Assignee') to finance, bill, collect rent, and remit sales t…
Is the admission charge to watch a roller derby exhibition subject to New York sales tax?
Yes — roller derby admission is taxable. Rollermania Inc. asked whether the charge to attend a roller derby exhibition is subject to sales tax. Under § 1105(f)(1), admission charges over ten cents to …
For a mail-order seller, does New York sales tax depend on where the product is delivered or on where the buyer lives?
Delivery point controls, not residence. Peter Knych, who sells tangible personal property by mail, asked two questions: must he collect New York sales tax when a Vermont resident has the product deliv…
Is a service that files loose-leaf update pages into a client's subscription publications taxable, even if the company only inserts and removes pages?
Yes — the filing service is taxable. L.G. & S.G. Inc. files the loose-leaf update services (e.g., Commerce Clearing House, Prentice Hall) that publishers send directly to its clients; its employee vis…
When a county public utility agency buys discounted hydroelectric 'preference power' from the state power authority and arranges for Con Edison to distribute and bill for it as the agency's operator, who owes sales tax, utility gross-earnings/receipts tax, and local utility tax on each piece of the arrangement?
The county Utility itself, as a governmental entity, is exempt from sales tax on its own purchases (with a purchase order) and from the utility franchise taxes entirely (since it isn't a taxable corpo…
When Con Edison leases part of its distribution system to a county public power agency and acts as that agency's billing/collection operator for discounted 'preference power,' which pieces of the arrangement create taxable receipts for Con Edison itself under the sales tax and the utility franchise/gross-receipts taxes?
Con Edison's own rental/service fee for leasing part of its distribution system to the County of Westchester Public Utility Service Agency and acting as its billing/collection operator IS Con Edison's…
When a business sells its subscriber list to a competitor, is that both a taxable sale of information and a bulk sale of business assets?
It is both. A C.P.A. asked, for a client that sells a taxable information service (a semi-monthly publication with about 200 subscribers), whether selling those accounts to a major competitor is both …
Is a company taxable when it obtains copies of public records like deeds and mortgages from a county clerk and furnishes them to an attorney?
Yes — furnishing public-record copies is a taxable information service. A law firm asked whether receipts from obtaining and furnishing copies of public records (deeds, mortgages) to a bank were taxab…
Are the trademark-search reports a company sells to attorneys a taxable information service, or are they exempt because they're personalized?
Taxable — the reports don't qualify for the personal/individual exclusion. Trademark Service Corporation compiles trademark records (federal, state, and common-law marks) into a library and sells sear…
Does a church have to charge sales tax on cookbooks it sells occasionally from its office?
No — occasional office sales aren't through a 'shop or store.' A Greek Orthodox church holds an Exempt Organization Certificate and keeps a small number of cookbooks (made from parishioners' recipes, …
Are in-flight movie projection systems and the movie films rented to airlines taxable in New York, and where does delivery occur?
The equipment is exempt; the films are taxable based on where delivery occurs. Inflight Services rents airlines light-weight film projectors, screens, and ear sets (and supervises installation) plus a…
Which of a bulk-mailing company's services — labeling, sealing, stamping, inserting, sorting, imprinting — are subject to sales tax?
The services split — some taxable, some not if separately stated. Skyview Graphics runs a bulk-mailing service and asked about eleven tasks. Producing, fabricating, processing, printing, or imprinting…
Is an employment-background investigation firm's work taxable as 'detective services' under New York City's tax, or exempt as an information service?
Taxable as detective services. Fidelifacts, an investigative agency, prepares employment-background reports on job applicants for its clients — including verifying application information but also int…
When a photo studio ships finished photographs, does New York sales tax depend on where they're delivered — including when out-of-state clients have them dropped at a New York address first?
Delivery point controls. A CPA asked, for a New York City photography studio, whether finished photographs delivered to various places are taxable. New York sales tax is a destination tax (20 NYCRR 52…
For a hazardous-waste treatment company, what's taxable — its equipment purchases, its charges to customers, and the disposal services it buys?
Equipment taxable; customer charges taxable; resold off-site disposal not taxable. BDT runs a hazardous-waste treatment facility (incineration and hydrolysis); nothing is reclaimed. (1) Its purchases …
Can a gas supplier buy the cylinders it provides to customers tax-free as purchases for resale?
Generally no — not on these facts. Jackson Welding sells industrial gases and welding supplies and provides gas cylinders to customers, almost always by lease. It argued its cylinder leasing is a sepa…
When Con Edison and New York City's own Public Utility Service jointly petition about a preference-power distribution deal -- Con Edison leasing part of its distribution system and acting as the City's billing/collection agent -- which pieces of the arrangement create taxable receipts for Con Edison, and which stay exempt as the City's own governmental purchase/resale?
The City's Public Utility Service, as a municipality, is exempt from sales tax on its own purchases (with a governmental purchase order) and owes nothing under the section 186 or 186-a utility franchi…
For a biotech company, which equipment, utilities, and services are exempt as research-and-development versus production — and does the exemption reach New York City?
R&D exemptions reach New York City; production exemptions don't. Enzo Biochem does laboratory research and manufactures DNA-based diagnostic probe kits, and asked how the research-and-development and …
Does a company's mobile filter press that refines industrial wastewater qualify for New York's manufacturing-machinery exemption?
No — it doesn't qualify. Central New York Industrial Services runs mobile filter presses (pumps, compressors, screens) that refine clients' liquid industrial waste on-site; the filtered water is pumpe…
Is charging to irradiate a core sample — making it radioactive so it can be tested — a taxable service in New York?
Yes — it's taxable. Company X, which analyzes core samples, needs each sample made radioactive before testing; Company Y performs the irradiation and returns the radioactive sample with a report of th…
Does a company that laser-prints tax returns from clients' data files sell taxable tangible personal property, or a service?
It's selling taxable tangible personal property, not a service. Lasar Image Corp. takes computer tapes from its accountant and tax-preparer clients and prints paper copies of income tax returns, then …
When a bank gives a depositor a 'gift' for buying a CD and builds the gift's value into a lower interest yield, is that a taxable sale?
Yes — they're taxable sales, not free promotional giveaways. A commercial bank planned to give each certificate-of-deposit buyer a 'gift' (all tangible personal property, none nominal in value), build…
Is a freestanding walk-in freezer bolted to a concrete slab a tax-exempt capital improvement, or a taxable purchase?
The freezer itself is taxable; only the concrete foundation is an exempt capital improvement. Dairy Barn Stores installs freestanding outdoor walk-in freezers — assembled on site, wired, and bolted to…
Does New York tax an aircraft engine warranty-repair contract, and where — the repair site or the aircraft's base?
It's a taxable service contract, and the tax follows where the aircraft is hangared — not where the repair is done. Garrett Turbine (Arizona) sells flying-hour engine warranties; customers get repairs…
Can New York force an out-of-state affiliate to collect sales tax just because its sister company operates in New York?
Possibly yes — if the out-of-state company is really the 'alter ego' of its New York affiliate. Levitz Furniture planned a new New Jersey corporation, owned by the same parent as its existing New York…
Does an out-of-state mail-order subsidiary have to collect New York tax just because a sister company runs stores here?
No — on these facts the mail-order company isn't the alter ego of its New York affiliate, so it has no nexus and needn't collect New York tax. Spencer Gifts planned to reorganize into a New Jersey 'Ma…
Must a city collect sales tax on the sewer 'user charges' it bills residents, even when a private firm runs the treatment plant?
No — the city's sewer user charges aren't taxable. The City of Long Beach bills residential and commercial users a 'user charge' for sewage treatment, and plans to have a private company build, own, a…
Which of an advertising agency's services and sales are taxable in New York, and how does a principal-agent agreement change the result?
It depends on what the agency is really selling: pure advertising services are exempt, but selling tangible property is taxable — and a valid principal-agent agreement shifts who owes the tax. In a de…
Are energy-efficient vertical blinds installed in office buildings a tax-exempt capital improvement?
No — the blinds are taxable, not a capital improvement. Verticals Inc. installs energy-efficient vertical blinds in commercial office buildings, often into permanent structural pockets at the windows,…
Does a trade association that runs a single three-day trade show each year count as a taxable-show 'promoter'?
No — running a single yearly show doesn't make the organizer a 'promoter,' though the landlord may be one. The Master Furriers Guild holds one three-day trade show a year. Under Tax Law § 1131(5)-(6),…
Is a landlord who only rents show space — without organizing the shows — a 'promoter' who must meet New York's show-permit rules?
Yes — if it hosts more than three shows a year, even a landlord that only rents space is a promoter. Madison Square Garden Center rents space to show organizers who subdivide and sublet it to vendors,…
Does a carpet retailer collect sales tax on installation — and does it matter what's under the carpet?
It depends on the surface underneath: carpet over a finished floor is a taxable installation, while carpet over a bare subfloor is a tax-exempt capital improvement. Brockport Carpet & Linoleum sells a…
Are a materials lab's concrete strength-test reports a taxable information service?
No — the reports are a non-taxable 'personal and individual' information service. Fortunato Sons, a contractor, buys concrete strength-and-standards testing from a lab. A written report compiling test…
When a hotel installs a lounge sound-and-light system, which parts are an exempt capital improvement and which are taxable?
It's decided component by component: the movable equipment is taxable, and the built-in pieces are a capital improvement only if permanent. A Holiday Inn installed a lounge system — DJ booth, speakers…
Can New York force out-of-state fur subsidiaries to collect tax when they share a brand and owners with New York stores?
Yes — here the New Jersey subsidiaries are the alter egos of their New York affiliate and parent, so they have nexus and must collect New York tax. Harfred / The Fur Vault planned to move their New Je…
Does a car-wash service that cleans a dealer's new, unsold vehicles have to charge sales tax?
No — not if the dealer gives a resale certificate, because the cars are held for sale. Thomas Murray plans to wash only new, unregistered cars and trucks at a dealer's premises. Washing a vehicle is n…
Is cook-to-order pizza that is sold and eaten unheated taxable, and does cooking it to order make it 'sold in a heated state'?
Cooking pizza to order does not make it 'sold in a heated state,' but the pizza is taxable unless the seller proves it is the kind of unheated food commonly sold in food stores like bakeries. This mod…
Is a CAD/CAM computer used to design custom manufactured products exempt as production machinery?
Mostly no — designing isn't 'production,' so the CAD/CAM computer isn't exempt production machinery, with one exception. Buffalo Forge uses its CAD/CAM system to create individualized drawings that le…
How is an advertising agency's work taxed in New York — its services, the property it produces, and purchases it makes for clients?
It depends on the activity — advertising services are exempt, but selling finished property is taxable, and buying tax-free as a client's agent requires a strict test. Advantage Concepts, an advertisi…
Is a perpetual license to computer software that the vendor analyzes and customizes for each customer subject to New York sales tax?
Not under the law in effect in 1986 — the customized software is treated as a non-taxable intangible. Financial Decision Systems sold perpetual licenses to CORPTAX, a mainframe corporate-tax product. …
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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.