I run a portable moving-and-storage-container business with a long list of separate charges — delivery, moving, storage, damage waivers, cleaning, repairs, supplies — which of these actually owe New York sales tax?

Plain-English summary

SAM (Store and Move), LLC (referred to in the opinion as "the Corporation") runs a portable-container storage and moving business through a network of independent dealers, who own or lease the actual containers, warehouse space, and delivery equipment. SAM's call center handles all customer contracts, billing, and collections, then pays dealers commissions for delivering, transporting, and storing containers. Customers sign a Rental Agreement with SAM for delivery of a container, storage (at a dealer's indoor or outdoor lot), and/or transportation to a new location; this opinion covers only container moves entirely within New York. Customers can also buy an optional damage waiver and rent or buy moving supplies and equipment.

SAM asked the Department to sort roughly 18 separate line-item charges into taxable and non-taxable buckets. The Department's answer splits along two underlying legal categories: rental of tangible personal property (the container itself, and dollies/pads) and storage services on one side (both taxable), versus pure transportation services, which aren't on New York's list of taxable services at all, on the other (not taxable) — with a few charges landing outside both categories entirely.

Taxable charges:

• Initial Delivery Charge (delivering an empty container) — part of the taxable container rental.
• Final Pick-Up Charge (retrieving an empty container) — same rental logic.
• Move to Warehouse / Move from Warehouse to New Location — because these moves are bundled with storing the customer's property at the dealer's warehouse, they're taxed as part of the taxable storage service, even though a move by itself normally wouldn't be.
• Non-Paved Surface Fee (delivery/pick-up of an empty container) — part of the taxable rental.
• Monthly Rental of Container, and both Monthly Storage Outside/Inside Warehouse charges, and the Warehouse Access Fee — straightforward taxable rental and storage charges.
• Reschedule/Cancellation Fee (once a driver has been dispatched) — taxed the same way a lease-cancellation fee on rented equipment is taxed under the regulations.
• Miscellaneous Supplies for Sale, and Dollies and Pads for Rent — ordinary taxable sales/rentals of tangible personal property.

Not taxable charges:

• Move to New Location, and Additional Stop Charge, and Non-Paved Surface Fee for transportation of an already-loaded container — as long as these are separately stated and don't involve a stop at the dealer's warehouse, they're purely local transportation services, and general transportation isn't one of the services New York's sales tax law reaches.
• Monthly Damage Waiver Rate — if separately stated, this is treated as a form of insurance, not a sale of property or a taxable service.
• Container Cleaning Charge and Container Repair Service — not taxable, on the assumption that these charges simply reimburse SAM for cleaning/repair services it purchased for the container (SAM's own purchase of those services is itself treated as a purchase for resale).

The throughline: whenever a charge is really about moving or handling an empty container as part of renting it out, or moving/handling a loaded container as part of storing it, it's taxable rental or storage. Whenever a charge is purely about point-to-point transportation without touching the warehouse/storage side of the business, it escapes tax because general transportation service isn't on New York's enumerated list of taxable services.

What this means for you

Portable-container, moving, and storage companies

Break out every fee on your invoice into "container rental," "storage service," or "pure transportation" — the first two are taxable, the third generally is not, but only if it's separately stated and doesn't touch your storage warehouse. A move that starts or ends at your own storage facility gets pulled into the taxable storage bucket even if it looks like ordinary transportation.

Businesses selling optional damage waivers or usage-based repair/cleaning charges

Separately stating an optional damage waiver keeps it out of the sales tax base (treated as insurance), and cleaning/repair charges that are pure reimbursement for services you purchased on the customer's behalf can also stay untaxed — but get the documentation and separate-statement mechanics right, since the exemption depends on it.

Accountants and tax professionals

This opinion is a useful line-item template for any tangible-personal-property rental business (equipment, containers, staging) that also offers transportation and storage add-ons — the rental-vs-storage-vs-transportation split, and the "does this touch the warehouse" test for moves, recur across many New York rulings in this space.

Common questions

Q: Is delivering and picking up a rented storage container taxable?
A: Yes, when the container being delivered or picked up is empty — it's part of the taxable rental of the container itself.

Q: Is moving a loaded container from my house to a new location taxable?
A: Not if it's a straight point-to-point move that doesn't involve the dealer's storage warehouse and is separately stated — that's a non-taxable general transportation service. But if the move is to or from the dealer's warehouse, it's taxed as part of the storage service.

Q: Is an optional damage waiver taxable?
A: No, if separately stated on the bill — it's treated as a form of insurance rather than a taxable sale or service.

Q: Are cleaning or repair fees charged after a rental taxable?
A: Not if they're simply reimbursing the company for cleaning or repair services it purchased on the customer's behalf (a purchase for resale) — but the underlying facts matter.

Q: Does this ruling apply to my container/moving business?
A: Not automatically. This is an Advisory Opinion binding only on the petitioner and only as to the facts it described. Your fee structure, contracts, and documentation may differ in ways that change the answer.

Citations and references

Statutes and regulations:

• Tax Law §1101(b)(3) (definition of "receipt")
• Tax Law §1101(b)(5) (definition of "sale, selling or purchase")
• Tax Law §1105(a) (tax on sale/rental of tangible personal property)
• Tax Law §1105(c)(4) (tax on storage services)
• 20 NYCRR §526.5(g) (pick-up/drop-off charges included in taxable receipt)
• 20 NYCRR §541.9(c)(1)(c) (equipment lease cancellation fee taxed as part of receipts)

Prior opinions referenced:

• Alamo Rent A Car, Inc., TSB-A-91(33)S (damage waiver and reimbursement-type charges)
• ELRAC, Inc., TSB-A-03(26)S (damage waiver as insurance)

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_2008.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a08_64s.pdf

Original ruling text

New York State Department of Taxation and Finance

TSB-A-08(64)S
Sales Tax
November 19, 2008

Office of Counsel
Advisory Opinion Unit
STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S080731A

SAM (Store and Move), LLC (“the Corporation”) is engaged in the business of renting, moving, and
storing portable containers. A petition received on July 31, 2008 requests an advisory opinion about the
Corporation’s sales and compensating use tax obligations with respect to the following sales of goods,
services and/or other intangibles:

A. Transportation charges

1. Initial Delivery Charge
2. Move to New Location
3. Move to Warehouse
4. Move from Warehouse to New Location
5. Final Pick-Up Charge
6. Additional Stop Charge
7. Non-Paved Surface Fee – Delivery/Pick-Up
8. Non-Paved Surface Fee – Transportation

B. Rental and Storage charges

1. Monthly Rental of Container
2. Monthly Storage Outside Warehouse
3. Monthly Storage Inside Warehouse
4. Monthly Damage Waiver Rate
5. Container Cleaning Charge
6. Warehouse Access Fee
7. Reschedule/Cancellation Fee
8. Container Repair Services

C. Moving Supplies and Equipment

1. Miscellaneous Supplies for Sale
2. Dollies and Pads for Rent
   Facts
   The Corporation operates through independent dealers located throughout the United States. Each
   independent dealer owns or leases portable storage containers, inside or outside warehouse space, and
   container delivery equipment. Each dealer enters into a Dealer Agreement with the Corporation whereby the
   dealer agrees to provide containers for use by the Corporation’s customers and to deliver, transport, and store
   these containers pursuant to instruction of the Corporation.
   The Corporation contracts directly with customers for container services, booking all customer orders
   for containers, associated container delivery and storage services, and other incidentals through its call
   center. The Corporation then arranges with each dealer to have the dealer deliver and pick up containers for
   customers, transport containers to and from various locations, and store containers at the dealer’s inside or
   outside warehouse locations. The Corporation handles nearly all payments, collections, and customer
   service issues, and pays the dealers transaction-based commissions for services provided.
   The Corporation enters into a Rental Agreement with each customer. The Rental Agreement
   provides that the customer is renting a container from the Corporation, that the Corporation will arrange
   delivery of the container to a location designated by the customer (such as a residence), and/or for storage of
   the container at a dealer’s storage locale (either an indoor warehouse or an outdoor fenced lot), and/or for
   transportation of the container to a new location. Since the Corporation’s current business activity in

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TSB-A-08(64)S
Sales Tax
November 19, 2008

New York State is limited to local and intrastate transportation services, this advisory opinion deals solely
with transportation of containers within New York State’s borders.
A customer may also choose to purchase from the Corporation a damage waiver that limits a
customer’s liability for damages occurring to the container. Additionally, customers may choose to rent
and/or purchase a variety of packing supplies and equipment from the Corporation. Depending on the
circumstances, the Corporation may also charge customers for any of the following: container cleaning fees,
warehouse access fees, rescheduling/cancellation fees, and container repair fees.
Issues
A.

Transportation Charges

1. “Initial Delivery Charge” – The charge for delivery of an empty container to a customer’s location.
   This transaction is taxable, as part of the receipt for the rental of tangible personal property (the storage
   container). See Tax Law §1101(b)(3) and 20 NYCRR 526.5(g).
2. “Move to New Location” – The charge for a local move of a container from a customer’s initially­
   designated location to a different customer–designated location. If the charge is separately stated and bears a
   reasonable relationship to the number, volume, or weight of the containers and the distance/mileage the
   containers are being moved, the charge for this transportation is not taxable. This container move is a general
   transportation service. Such a service is not one of the taxable services enumerated in section 1105(c) of the
   Tax Law, and therefore is not a service subject to sales tax.
3. & 4. “Move to Warehouse” and “Move from Warehouse to New Location” – The charge for a
   pick-up of a loaded container from a customer’s location and delivery of the container to a dealer’s inside or
   outside storage locale and the charge for the pick-up of a loaded container from a dealer’s storage locale and
   subsequent delivery of the container to a customer-designated location. These fees are taxable, as part of the
   receipt for the service of storing tangible personal property (the contents of the container belonging to the
   customer) at the dealer’s storage locale. Sales Tax Regulation 526.5(g) provides that the charges by a vendor
   to its customer for picking up or dropping off of the customer's property upon which the vendor is to perform
   taxable services are part of the vendor's receipt from the sale of the service subject to tax. Therefore, the
   provision of moving the storage container is part of the same taxable transaction when provided in
   conjunction with the storage of the tangible personal property inside the container. See Tax Law §1105(c)(4)
   and 20 NYCRR 526.5(g).
4. “Final Pick-Up Charge” – The charge for the pick-up of an empty container from a customer
   location. This transaction is taxable, as part of the receipt for the rental of tangible personal property (the
   storage container). See Tax Law §1101(b)(3) and 20 NYCRR 526.5(g).
5. “Additional Stop Charge” – The fee charged when a customer chooses to have a container
   delivered to multiple customer-designated locations, one stop at a time. Assuming the move does not
   involve a move to a dealer’s warehouse location, charges for this purely transportation-related transaction, if
   separately stated, are not taxable, since that transaction would involve solely the provision of a general
   transportation service that is not enumerated in section 1105(c) of the Tax Law as a service subject to sales
   tax.

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TSB-A-08(64)S
Sales Tax
November 19, 2008

7. “Non-Paved Surface Fee – Initial Delivery/Final Pick-Up” - The fee that is charged because a
   customer has requested that an empty container be placed on and/or removed from a non-paved surface in
   connection with initial delivery or final pick up. This transaction is taxable, as part of the receipt for the
   rental of tangible personal property (the storage container). See Tax Law §1101(b)(3) and 20 NYCRR
   526.5(g).
8. “Non-Paved Surface Fee – Transportation” - The fee that is charged because a customer has
   requested that an empty container be placed on, and/or removed from, a non-paved surface in connection
   with transportation of a loaded container from one customer-designated location to another. Assuming the
   move does not involve a stop at a dealer’s warehouse, charges for this purely transportation-related
   transaction, if separately stated, are not taxable, since that transaction would involve solely the provision of a
   general transportation service that is not enumerated in section 1105(c) of the Tax Law as a service subject to
   sales tax.
   B.

Rental and Storage Charges

1. “Monthly Rental of Container” – The basic charge for the rental of the container by the customer;
   does not include storage at a dealer storage locale; rather, it assumes that the container will be stored at a
   customer location. This charge is taxable under Tax Law §1105(a), as a charge for the rental of tangible
   personal property (the storage container).
   2-3. “Monthly Storage Outside Warehouse” and “Monthly Storage Inside Warehouse” – The
   incremental addition to the base monthly rental fee for storage of the container at the dealer’s storage
   location (outside or inside). This charge is taxable under Tax Law §1105(c)(4), as the service of storing
   tangible personal property (the customer’s property within the container).
2. “Monthly Damage Waiver Rate” – The optional monthly charge that provides a customer a waiver
   of liability for certain damage that may occur to the container while it is being rented by the customer. This
   charge is not taxable, if separately stated on the bill given to the customer. This separately stated charge is
   for neither a sale of tangible personal property nor a service enumerated by Tax Law §1105(c). The waiver
   is considered to be, in substance, a form of insurance. See Alamo Rent A Car, Inc., TSB-A-91(33)S and
   ELRAC, Inc., TSB-A-03(26)S.
3. “Container Cleaning Charge” - A contingent charge billed to the customer if the customer fails to
   properly clean out the container after use. This charge is not taxable, assuming that the payment by the
   customer reimburses the Corporation for its purchases of cleaning services to the tangible personal property
   the Corporation has rented. The contingent charges are considered purchases made by the Corporation for
   resale purposes. See Alamo Rent A Car, Inc., supra.
4. “Warehouse Access Fee” – The container handling charge that will be imposed if a customer needs
   to access their belongings while the container is in storage at the dealer’s storage facility. This charge is
   taxable as part of the receipt for the storage of the customer’s tangible personal property under Tax Law
   §1105(c)(4). Providing access to the storage container is part of the same taxable transaction when provided
   in conjunction with the storage of the customer’s property inside the container.
5. “Reschedule/Cancellation Fee” – The fee that is charged when a customer changes or cancels the
   delivery or pick-up date for a container after the driver has already been dispatched. This charge is taxable,

TSB-A-08(64)S
Sales Tax
November 19, 2008

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as part of the receipts of the rental of tangible personal property. This is consistent with our interpretation of
§§1105(a) and 1101(b)(5) of the Tax Law in connection with a lease of equipment by a contractor. Thus,
20 NYCRR 541.9(c)(1)(c) provides that “[i]f a contractor [lessee] cancels a lease on equipment and the
lessor charges a cancellation fee, such fee is included as a part of the total receipts upon which the tax is
based.”

8. “Container Repair Service” – The fee for repair services that a customer must pay when a
   container is damaged while being rented by the customer and the damage is not covered by a damage waiver.
   This charge is not taxable, assuming that the payments by the customer reimburse the Corporation for its
   purchases of repairs to the tangible personal property the Corporation has rented. The repair charges are
   considered purchases made by the Corporation for resale purposes. See Alamo Rent A Car, Inc., supra.
   C.

Moving Supplies and Equipment

1. “Miscellaneous Supplies for Sale” – The sale of various straps, locks, pads and other moving
   equipment that are sold through the Corporation’s central call center, processed by a third party vendor, and
   shipped directly to the customer. These charges are taxable under Tax Law §1105(a), as the sale of tangible
   personal property.
2. “Dollies and Pads for Rent” – The rental of dollies and pads by the Corporation or the
   Corporation’s dealer to a customer for a limited period of time. These receipts are taxable under Tax Law
   §1105(a), as receipts for the rental of tangible personal property.

DATED: November 19, 2008

NOTE:

/S/
Jonathan Pessen
Director of Advisory Opinions
Office of Counsel

An Advisory Opinion is issued at the request of a person or entity. It islimited to the
facts set forth therein and is binding on the Department only with respect to the person
or entity to whom it is issued and only if the person or entity fully and accurately
describes all relevant facts. An Advisory Opinion is based on the law, regulations, and
Department policies in effect as of the date the Opinion is issued or for the specific
time period at issue in the Opinion.