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Ezel / Tax Rulings / TX
TX 8411L0603A05 Sales and/or Use Tax (State,Local,MTA) 1984-11-09

Could a Texas school district buy athletic jackets tax-free either as student awards or for resale to students?

Short answer: Yes. Award jackets could be bought with an exemption certificate. Jackets bought for sale to students required a resale certificate, followed by collection and remittance of tax on the student sale.

Apply this to your situation

This page answers the general question as of 1984. Ezel answers yours, under current Texas tax law, with citations.

Currency note: this ruling is from 1984
Subsequent statutory amendments, regulation changes, court decisions, or later rulings may have changed the analysis. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, rate, or position mentioned here.
Disclaimer: This is an official Texas Comptroller of Public Accounts letter published on the State Tax Automated Research (STAR) system. Letters on STAR can be the basis of a detrimental reliance claim only for the taxpayer to whom the letter was directly issued (see 34 Tex. Admin. Code Rules 3.1 and 3.10); documents on STAR may no longer represent current policy even if not marked superseded. Taxpayer-identifying details are redacted. This summary is informational only and is not legal or tax advice. Consult a licensed Texas tax professional about your specific situation.
About this page: The plain-English summary, reader guidance, and Q&A below were written by Ezel based on the official state tax ruling. The original ruling (linked on this page) is the authoritative source for any reliance.

Plain-English summary

The Texas Comptroller said an independent school district could buy athletic jackets tax-free when it gave them to athletes as awards. The district could provide its supplier an exemption certificate and was told to disregard a paragraph of TR 0858.

The district could also buy jackets tax-free for resale to students by giving the supplier a resale certificate. It then had to collect and remit sales tax when it sold the jackets to students.

What this means for you

School districts

The correct certificate depended on what the district would do with the jacket: give it as an award or sell it to the student.

Athletic departments

Award jackets could use the exemption-certificate route described in the letter.

Accountants and tax professionals

For student sales, retain the resale certificate and records showing collection and remittance of tax.

Common questions

Q: Could a district buy jackets tax-free to give athletes as awards?
A: Yes, with an exemption certificate.

Q: Could a district buy jackets tax-free to sell to students?
A: Yes, with a resale certificate.

Q: Was the later sale to the student tax-free?
A: No. The district had to collect and remit tax on the sale.

Citations and references

  • TR 0858 (the letter instructs the district to disregard one paragraph but does not reproduce or identify that paragraph)

Source

Original ruling text

November 9, 1984

Dear **:

Thank you for your recent letter regarding athletic jackets in which
you ask:

  1. Under what conditions can the ** Independent School
    District purchase athletic jackets tax free and use these
    as an award to the individual students?

ANSWER: You may purchase jackets to be given to the athletes tax
free. Please disregard that paragraph of TR 0858. An exemption
certificate may be given to your supplier.

  1. Under what conditions can the ** Independent School
    District purchase athletic jackets tax free and in return sell the
    jacket to the student and collect the applicable sales tax?

ANSWER: You should give a resale certificate in lieu of tax to your
supplier. You would collect and remit tax when the jackets are sold.

This opinion is based on the facts presented. If there are additional
of different facts, the opinion may change.

Please feel free to contact me if you have additional questions. You
may write me or call toll-free 1-800-252-5555 from anywhere in Texas.

Sincerely,

Al Van Allen
Tax Policy
Tax Administration Division

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