Was labor to repair, paint, or remodel homes, townhouses, condominiums, apartment complexes, and apartment laundry rooms taxable in Texas?

Plain-English summary

Labor to repair, paint, or remodel residential homes, townhouses, condominiums, apartment complexes, and apartment-complex laundry rooms was not taxable. The result included homes and condominiums that were occupied, unoccupied, or listed for sale.

A separate apartment-complex office outside the residential area was commercial property, so labor to repair, paint, or remodel that office was taxable.

Under a lump-sum residential contract, the provider was the consumer and paid tax on incorporated materials. Under a separated contract, it bought incorporated materials for resale and collected tax from the customer on the materials charge.

What this means for you

The 1988 letter treated the apartment laundry room as part of the residential complex but separated a stand-alone management office as commercial property.

Common questions

Was apartment repair labor taxable? No.

Did occupancy or listing for sale change residential treatment? No.

Was an apartment laundry room residential? Yes.

Was a separate apartment office commercial? Yes.

Citations and references

The letter did not cite a rule or statute by number.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/8802L0863A05

Original ruling text

February 4, 1988

Dear ***:

Thank you for your letter concerning taxability of repairs, painting and
remodeling of real property as follows:

1. Residential homes, townhouses and condo's (both occupied and
   unoccupied/listed for sale)

2. Apartment complexes

3. Apartment complex laundry rooms (these are a part of the apartment complex
   as opposed to a strip center laundromat).

The labor to repair, paint and remodel the residential real property outlined
above, including the laundry room, is not taxable.

An apartment complex office that is separate and apart from the residential
area is commercial property and the labor to repair, paint or remodel the
office would be taxable.

Under a lump-sum contract, you are considered the consumer and owe tax on all
materials incorporated into the property. Under a separated contract, you may
purchase materials to be incorporated into the property tax free under a resale
certificate. Tax must be collected from your customer on the charge for
materials.

Sincerely,

(Mrs.) Jo Ann Dieck
Tax Policy Division