Are home drinking-water lead-test kits and a faucet-mounted water filtration system exempt from sales tax as medical equipment?

Plain-English summary

Joseph L. Ryerson asked whether two consumer products should be exempt from sales tax as medical equipment: (1) home drinking-water test kits (state-certified to detect lead from contaminated supplies, lead pipes, or lead solder), and (2) a portable, faucet-mounted water filtration system (marketed to remove lead, chlorine-related carcinogens, and other toxins — plus rust and scale).

The Department said both are taxable.

• The medical-equipment test. To be exempt under Tax Law § 1115(a)(3), a device must (per 20 NYCRR § 528.4(e)) be intended for use in the cure, mitigation, treatment, or prevention of illness or disease (or to correct/alleviate physical incapacity), and be primarily and customarily used for medical purposes and not generally useful in the absence of illness, injury, or incapacity.
• Test kits → taxable. The kits test water — regardless of the medical condition of whoever lives in the house — and don't themselves cure, mitigate, treat, or prevent any illness. So they aren't medical equipment.
• Filtration system → taxable. The filter is not primarily or customarily used for medical purposes and is generally useful even without illness — it produces purer water (removing rust and scale) whether or not lead or toxins are present. The Department analogized it to air conditioners and air purifiers, which § 528.4 treats as non-medical even when purchased to alleviate an existing illness.

What this means for you

"Health-protective" is not the same as "medical equipment." New York's exemption is narrow: the device has to be used to treat illness and be primarily medical and not something a healthy person would also find useful. Products that improve safety or comfort for everyone — water filters, air purifiers, air conditioners — stay taxable even when a buyer's motive is a health condition.

Testing/diagnostic consumer kits are generally taxable. A kit that measures a condition in the environment (like lead in tap water) doesn't cure, mitigate, treat, or prevent illness, so it isn't exempt medical equipment.

Look at the regulation's actual examples. § 528.4(c) lists what counts (hospital beds, wheelchairs, dialysis equipment, respirators, crutches, braces, walkers, nebulizers, traction and orthodontic devices, etc.) — items primarily and customarily used for medical purposes. If your product isn't in that character, don't assume the exemption applies.

Common questions

Q: I sell home water-testing kits. Are they exempt as medical supplies?
A: No. They test water regardless of anyone's medical condition and don't treat illness, so they're taxable.

Q: What about a water filter that removes lead and carcinogens?
A: Still taxable. It isn't primarily or customarily medical, and it's generally useful even without illness (it also removes rust and scale) — like an air purifier, which is non-medical even if bought for a health reason.

Q: Does it matter that the state certified the test kit?
A: No. Certification for detecting lead doesn't make the kit "medical equipment" under § 1115(a)(3); the device still has to meet the treat-illness and primarily-medical tests.

Citations and references

Statute and regulation:

• Tax Law § 1105(a) — imposes sales tax on receipts from retail sales of tangible personal property
• Tax Law § 1115(a)(3) — exempts medical equipment and supplies
• 20 NYCRR § 528.4(e) — "medical equipment" must be intended for use in the cure/mitigation/treatment/prevention of illness (or correction/alleviation of incapacity) and be primarily and customarily used for medical purposes and not generally useful in the absence of illness
• 20 NYCRR § 528.4(c) — examples of qualifying medical equipment (hospital beds, wheelchairs, dialysis equipment, respirators, crutches, braces, walkers, nebulizers, etc.); air conditioners and air purifiers are excluded as non-medical even if purchased to alleviate illness

Source

• Landing page: https://www.tax.ny.gov/pubs_and_bulls/advisory_opinions/sales_ao_1988.htm
• Opinion: https://www.tax.ny.gov/pdf/advisory_opinions/sales/a88_53s.pdf

Original ruling text

New York State Department of Taxation and Finance

Taxpayer Services Division
Technical Services Bureau

TSB-A-88 (53)S
Sales Tax
October 21, 1988

STATE OF NEW YORK
COMMISSIONER OF TAXATION AND FINANCE
ADVISORY OPINION

PETITION NO. S880715A

On July 15, 1988, a Petition for Advisory Opinion was received from Joseph L. Ryerson,
R.D. #2 Box 4, Holland Patent, New York 13354.
The issues raised are whether the sale of home drinking water test kits and water treatment
system are subject to the New York State sales tax.
Petitioner urges that the sale by licensed pharmacists of home drinking water test kits should
be exempted from sales and use tax. Petitioner states that the kits in question have been certified by
the State of New York for use by New York residents in determining the level of lead contamination
in their home drinking water due to contaminated water supplies or from lead pipes or lead pipe
solder.
Petitioner also urges that home drinking water filtration systems installed to remove lead,
chlorine related carcinogenic compounds and numerous additional organic and inorganic toxins
should be similarly exempted from sales and use tax. It is noted that a brochure submitted as part
of the Petition for Advisory Opinion describes the filtration system in question as "completely
portable and quickly attaches to any ordinary faucet." The brochure also indicates that the system
removes rust and scale from the water as well as the harmful substances included above.
Section 1105(a) of the Tax Law impose sales tax upon "[t]he receipts from every retail sale
of tangible personal property, except as otherwise provided in this article."
Section 1115(a)(3) of the Tax Law exempts medical equipment and supplies from the tax
imposed by section 1105(a) of the Tax Law.
Section 528.4(e) of the sales tax regulation defines medical equipment as:
(e)
Medical equipment. (1) Medical equipment means machinery, apparatus and
other devices (other than prosthetic aids, hearing aids, eyeglasses and artificial
devices which qualify for exemption under section 1115(a)(4) of the Tax Law),
which are intended for use in the cure, mitigation, treatment or prevention of illnesses
or diseases or the correction or alleviation of physical incapacity in human beings.
(2) To qualify, such equipment must be primarily and customarily used for
medical purposes and not be generally useful in the absence of illness, injury
or physical incapacity.
Petitioner's test kits are not used in the "...cure, mitigation, treatment or prevention of
illnesses or diseases..." Rather, the test kits are used to test drinking water in a variety of homes
without regard to the medical condition of the tenant or resident of the house. Moreover, the test kit
TP-9 (9/88)

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TSB-A-88 (53)S
Sales Tax
October 21, 1988

neither cures, mitigates, treats or prevents illness or disease or corrects or alleviates physical
incapacity in human beings.
Accordingly, the test kits are subject to the sales and use tax.
Petitioner's water filtration system is not primarily or customarily used for medical purposes.
It is generally useful in the absence of illness, injury or physical incapacity.
The term "medical equipment" includes such things as hospital beds, wheel chairs,
hemodialysis equipment, iron lungs, respirators, oxygen tents, crutches, back and neck braces,
trusses, trapeze bars, walkers, inhalators, nebulizers, traction equipment, orthodontic devices and
intrauterine birth control devices all of which are primarily or customarily used for medical purposes
(See: 20 NYCRR 528.4(c)). However, this term does not include air conditioners or air purifiers due
to the non-medical nature of such equipment. This is so even if air conditioners or air purifiers are
purchased to alleviate an existing illness. Moreover, the water filtration system removes rust and
scale and, thus, produces purer water even in the absence of lead, toxins and other harmful
substances.
Accordingly, the water filtration system does not qualify as medical equipment and is,
therefore, subject to sales and use tax.

DATED: October 21, 1988

s/FRANK J. PUCCIA
Director
Technical Services Bureau

NOTE: The opinions expressed in Advisory Opinions
are limited to the facts set forth therein.