Texas State Tax Rulings
Free plain-English summaries of state tax letter rulings and advisory opinions issued in Texas, with full citations and the original source on every page.
No Texas rulings match these filters
Try a different search term or clear the filters.
When were an advertising agency's internal-work commissions and radio or television production charges taxable in Texas?
Commissions tied to taxable in-house finished art were taxable, while preliminary art and third-party acquisition commissions were not; commercial production was generally nontaxable.
How did Texas tax advertising-agency work related to finished art, and how should fixed-price billing adjustments affect collected tax?
Work related to finished art was taxable, including post-approval copywriting; billing records and any client tax adjustment had to match the final taxable charge.
How did Texas tax garbage-collection costs when Houston reimbursed a homeowners association and residents paid the difference?
If residents were billed the unreimbursed difference, tax applied only to that amount; if the association absorbed it, the contractor's entire charge was taxable.
Were Shaved Ice Flavor Packets exempt food products for Texas sales-tax purposes?
No. The Comptroller treated the flavor packets as taxable because packaged soft drinks and diluted juices were excluded from the rule's food-product definition.
Were separately stated port charges on passenger tickets for an entertainment vessel subject to Texas sales tax?
Yes. The port charges were part of the selling price of the taxable amusement service, so tax applied to the total admission price including those charges.
Are reduced campground fees for storing unoccupied camping trailers and recreational vehicles subject to Texas sales tax?
Yes. Texas treated the charges as taxable storage of an unoccupied trailer or recreational vehicle, even when the vehicle remained at a campsite.
When were printed inserts for Texas newspapers or magazines exempt from sales tax?
Newspaper inserts were exempt when delivered by the printer to the newspaper distributor with supporting documentation; magazine inserts were generally taxable.
Were separately listed design, engineering, manufacturing, and performance-testing charges taxable when a manufacturer sold custom equipment?
Yes. Every listed charge was part of producing and selling the custom equipment, so design, engineering, manufacturing, and testing were all taxable.
Must a Texas campground charge sales tax for storing an owner's unoccupied trailer or recreational vehicle?
Yes. The Comptroller said a campground's charge for storing an unoccupied trailer or recreational vehicle was taxable, whether or not water and electricity were connected.
Were a Texas valet-parking company's hourly charges taxable, or did supplying employees qualify as exempt temporary help?
The total charge was taxable motor-vehicle parking service. Supplying valet workers did not qualify as temporary help under the facts described.
Which tax-preparation, electronic-filing, return-review, and refund-anticipation-loan charges were taxable in Texas?
Standalone electronic-filing fees were taxable; return preparation, return review, prepaid interest, and electronic filing provided at no charge were not.
What did the published correction say about whether an acute rehabilitation center's patient facilities were residences for utility-tax purposes?
It corrected the prior letter to say the facilities were not residences, even though patients might be confined for more than 30 days; it did not reproduce the tax conclusion.
Was BARLEYGREEN powder made from barley-leaf juice, brown rice, and kelp exempt from Texas sales and use tax?
Yes. The Comptroller classified BARLEYGREEN as a powdered food product and said Texas sales tax did not need to be collected on its sale.
What publication-refund items did Texas audit guidance allow or disallow after the Texas Monthly case?
The memo allowed qualifying publisher-created tax, reference, and travel publications, but disallowed reproductions, information services, printing, lists, and maps.
Could a debt collector accept a Texas sales-tax exemption certificate from a bank holding notes formerly connected to the FDIC or FSLIC?
No. The bank, not the FDIC, was the debt-collection client, and the letter found the bank was not a tax-exempt governmental entity.
Could a vending-machine operator obtain a refund of Texas sales tax remitted on newly exempt 25-cent bulk-vending sales?
It depended. Tax paid from the operator's own gross receipts could be refunded, but tax collected from customers had to be returned to them first.
Which charges for developing Texas video training seminars, manuals, master tapes, and copies were taxable?
Seminar and manual development was not taxable, but the developer owed tax on its materials and had to tax copies of master tapes, manuals, and other training materials.
Did Texas county sales tax apply to residential use of gas and electricity?
No. The Comptroller said county tax followed the same guidelines as state tax, so county and state tax should not be collected on residential electricity use.
How did Texas sales tax apply to a contractor expanding an underground sprinkler system at an apartment complex?
Labor to improve the residential property was not taxable; material-tax treatment depended on whether the contractor used a lump-sum or separated contract.
How did Texas apply sales and use tax to demolition, site preparation, equipment, freight, and contracts for a new manufacturing project?
The treatment varied: complete demolition and new-construction labor were generally nontaxable, while debris removal, taxable materials, equipment, and some installation charges were taxable.
Which purchases could a property manager make tax-free in Fannie Mae's name under the reviewed Texas management contract?
Items bought in Fannie Mae's name and incorporated into or used on the managed property could qualify; the manager's own phone, office supplies, and equipment did not.
Did transferring accounts receivable under a federal bankruptcy-court order accelerate unpaid Texas sales tax?
No. The Comptroller declined to accelerate the remaining tax under Rule 3.302(c), and the court-authorized collector could continue cash-basis reporting.
Was an optional, nonrefundable damage-waiver fee on a Texas tuxedo rental taxable?
Yes. The Comptroller treated the waiver fee as a prepayment toward taxable restoration or repair services, so the rental business had to tax it.
Was feed for a rancher's cow dog exempt from Texas sales tax when the dog was not used exclusively on the farm or ranch?
No. Feed for a working cattle dog was exempt only if the dog was used exclusively on the farm or ranch; this dog's off-farm use made its food taxable.
How did Texas tax shared title-plant costs, management services, and information sold to shareholders and nonshareholders?
A jointly owned title plant paid tax on taxable inputs but did not tax shareholder cost reimbursements; taxable information sold to nonshareholders remained taxable.
Were separately stated insurance charges for goods shipped to customers taxable in Texas?
Yes. Insurance charges on shipped goods were taxable even when separately stated because the Comptroller treated them as part of the sales price.
Could a Texas direct-payment-permit holder use its certificate and seek an Enterprise Zone Project tax refund on construction purchases?
Yes for a separated contract, but not a lump-sum contract. The permit holder could accrue tax on materials and seek a refund for qualifying purchases and new jobs.
Were Texas repair charges for exempt medical equipment and prescribed therapeutic appliances taxable?
No. Repairs to exempt medical equipment were exempt, and therapeutic-device repairs were exempt when the individual used the item under a practitioner's prescription.
Were other states and their political subdivisions exempt from Texas sales and use tax on purchases made in Texas?
No. The Texas governmental exemption did not cover other states or their political subdivisions, so they owed state and applicable local tax.
Did the Texas Monthly publication-refund decision entitle an online database provider's customers to refunds of tax on search services?
No. The company sold taxable information services, not periodicals or other publications covered by the Texas Monthly refund treatment.
Which electricity used by a Texas ship repairer and machine shop qualified for the manufacturing exemption?
Electricity directly used to manufacture parts and fabricated items for sale was exempt; electricity used to install or repair customer property was taxable commercial use.
Did Texas tax equipment sold for use in refurbishing a West Indies refinery?
The seller had to collect Texas tax unless it delivered the items to a carrier or freight forwarder for export; purchaser possession in Texas made tax due, subject to a documented import refund.
How did Texas tax merchant credit-card processing, purchased data processing, setup packages, and card-authorization services?
Merchant processing and authorization were nontaxable, but purchased data processing was taxable unless it benefited the processor's own out-of-state location.
Did arranging engineering and equipment-installation work in Texas require an Illinois seller to collect Texas tax?
Yes. Engineering and installation performed in Texas on the seller's behalf meant it was doing business in Texas and had to obtain a permit and collect applicable state and local tax.
Did Texas tax software delivered to an affiliated company outside Texas or data-processing access sold to its Texas affiliate?
Out-of-state software delivery and related out-of-state services were not taxable; intercompany data processing was exempt only if the affiliates qualified under § 151.346.
Was a Texas periodical-subscription agency the taxable seller of magazines it ordered for libraries and corporate customers?
No. The agency provided a nontaxable service and never owned or possessed the periodicals; the publisher sold the subscription to the customer.
Did Comptroller's Decision No. 22,974 concern cylinder charges imposed on industrial-gas customers?
No. It concerned the taxpayer's own lease payments for cylinders it acquired, and the Comptroller said a published CCH summary incorrectly described those payments as customer charges.
Was the federal luxury tax included in the amount subject to Texas sales or use tax on jewelry and furs?
No, when separately stated and identified on the invoice. Texas sales tax still applied to the full retail sales price before the federal luxury tax.
Could a Texas seller's clearing-house agent file sales-tax returns and remit tax under the agent's permit number?
No. An agent could bill customers and collect funds, but the seller remained responsible for filing returns, remitting tax, and keeping sales records.
Was removing a cement plug from existing well casing to reenter a plugged and abandoned Texas well subject to sales tax?
No. Texas treated drilling cement out of existing casing to reenter a plugged well as a nontaxable well service.
Did an aircraft used in a Texas aerial-photography business qualify as manufacturing equipment?
No. Although necessary and essential to producing aerial photographs, the aircraft was not used directly in manufacturing them.
Were 12-month subscriptions to monthly or biweekly comic books taxable in Texas?
Yes. The comic books did not qualify as magazines because they lacked stories, articles, and essays by various writers as required by Rule 3.299.
Which cookbook, book, and museum-meal sales by a qualifying Texas nonprofit organization were taxable?
Its own published cookbook was exempt, but books it did not publish—including exclusive reprints—and meals sold at its museum were taxable.
When were charges for slicing and disposing of used tires taxable as garbage collection in Texas?
They were nontaxable when customers brought tires to the same place where they were sliced and buried, but taxable when the company picked them up or hauled them to another disposal site.
How could publishers return and recover Texas sales tax on qualifying pre-August 28, 1989 publication sales after Texas Monthly?
Publishers could refund customers and claim a credit or amend returns, or assign the refund right to customers with the required invoices and schedules.
How did Texas tax fixed-price residential and commercial repair contracts and insurance reimbursements for cost overruns?
Residential lump-sum customers were not charged tax and the contractor paid tax on materials; commercial billings were taxable, with no extra tax on documented insurance reimbursements.
When were lump-sum HVAC filter and preventive-maintenance contracts taxable in Texas?
Maintenance-only plans were nontaxable; a plan including repairs stayed nontaxable only while repair charges were 5% or less of the total, with parts treated separately.
Were separately stated telephone-directory listing charges taxable in Texas?
No. Directory listings were not taxable items when separately stated, but a lump-sum charge combining a listing with taxable basic local exchange service was fully taxable.
Did steam generators and distribution lines used for tertiary oil recovery become improvements to Texas real property?
No. The generators and lines remained tangible personal property because they retained their identity and could be removed without extensive damage; attached support arms might differ.
Did a Texas electronic tax-return filing service have to collect tax from out-of-state customers?
No for the described non-Texas customers. Electronic filing was treated as telecommunications, and long-distance service was exempt unless both originated from and was billed to Texas.
How did a Texas electronic tax-filing provider tax customers and buy the underlying data transmission?
It could buy transmission for resale, charged no Texas tax to non-Texas customers, and charged state and local tax to Texas customers, with local tax based on its sales office.
Did an after-the-fact statement that tax was included in a lump-sum repair invoice protect the customer from Texas tax liability?
Not by itself. The customer needed specific proof of the taxable price, state and local tax amounts and rates, and the reporting period in which the vendor remitted the tax.
Was monthly microbial treatment that prevented paraffin buildup in oil-well equipment taxable in Texas?
Yes. Texas classified the treatment as taxable maintenance of tangible personal property because it limited deterioration of tubing, rods, and flow lines.
Were labor and materials for restoring Texas historic buildings exempt from sales tax?
Labor was exempt only for property in the National Register of Historic Places; a Recorded Texas Historic Landmark alone did not qualify, and materials remained taxable unless another exemption applie…
Was destructive testing of computer chips for manufacturers a taxable Texas service?
No. The chip-testing service was not taxable, and destroying sample chips during testing did not make the work processing or part of manufacturing.
Were nitrogen and carbon dioxide taxable when injected into a formation to maintain pressure during natural-gas production?
Yes. The gases served no identified exempt function and were not resold, so Texas treated both nitrogen and carbon dioxide as taxable in the described use.
Was a nine-year machinery sale-leaseback with a 10%-of-cost purchase option a financing lease for Texas tax?
Yes. The option price was only one-sixth of expected fair market value, making it nominal; Texas taxed the financing lease as a sale rather than an operating lease.
Were food, drinks, gratuities, and ceremony charges for a church-sponsored wedding taxable in Texas?
Church-prepared food and cake were exempt, but a caterer's food, cake, alcohol, and gratuity charges were taxable; separately stated ceremony charges were not taxable.
Did Texas utilities need exemption certificates for electricity accounts coded as agricultural irrigation?
Yes. Power used to irrigate farm or ranch products for sale was exempt, but the utility still needed a certificate showing exclusive or predominant qualifying use.
Was licensed collection and hauling of special or infectious medical waste for the Texas prison system taxable?
No. The collection service was nontaxable, but the hauler owed tax on containers, air-conditioning units, and all other items used to store, collect, and transport the waste.
Browse Texas rulings by topic
These are official tax letter rulings and advisory opinions issued by Texas'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.