A medical equipment seller asked how Texas sales tax applies to four products: therapy mattress replacements/overlays, sequential compression devices, patient weighing systems (scales), and incontinence pads used with hospital/nursing home beds. Are incontinence pads exempt from sales tax?

Plain-English summary

A company that sells medical equipment asked the Comptroller how Texas sales tax applies to four different products it sells. This page focuses on the fourth item, incontinence pads, but the letter addresses all four, and the surrounding context helps explain the pads ruling.

Note: this letter actually covers four separate products with three different outcomes. The subject_title reflects the STAR system's own heading for this letter (incontinence pads), which is the item most directly relevant to this page's slug, but the full holding is broader — see the breakdown below.

• Therapy mattress replacements and overlays (a pressure-relieving system that reduces pressure and moisture, described as the leading cause of pressure sores): exempt from sales tax.
• Sequential compression devices and accessories (used to prevent deep vein thrombosis before, during, and after orthopedic surgery): exempt from sales tax.
• Patient weighing systems (scales) (designed for accuracy, linearity, repeatability, and low drift to track patient weight/weight change over time): not exempt — the Comptroller found scales don't fit into either of the exemption categories (orthopedic or prosthetic), so there is no basis for exempting them.
• Incontinence pads used in conjunction with beds for incontinent patients: categorized as therapeutic appliances, which are exempt from tax only when sold to individuals under a doctor's prescription. When sold to hospitals and nursing homes, the pads are taxable.

What this means for you

Sellers of incontinence pads and similar therapeutic appliances

The exemption for incontinence pads turns entirely on who the buyer is and whether there's a doctor's prescription — not on the nature of the product itself. A sale to an individual patient with a doctor's prescription is exempt; the identical pad sold to a hospital or nursing home is taxable. Sellers need to track the buyer type and collect/retain prescription documentation to support exempt sales.

Hospitals and nursing homes purchasing incontinence pads

Because these institutional purchases are treated as taxable, hospitals and nursing homes buying incontinence pads for patient use should expect to pay sales tax on them, unlike an individual patient buying the same product with a prescription.

Medical equipment sellers with mixed product lines

This letter is a good illustration of how differently the Comptroller can treat products that seem similar on the surface. A pressure-relieving mattress system and compression devices were ruled exempt outright, weighing scales were ruled fully taxable, and incontinence pads landed in between — exempt or taxable depending on the buyer. Don't assume one exemption category covers your whole product catalog; each item (and often each type of sale) needs its own analysis.

Individuals purchasing with a doctor's prescription

If you're buying incontinence pads as an individual with a doctor's prescription, this letter supports treating that purchase as exempt from Texas sales tax as a therapeutic appliance.

Common questions

Q: Are incontinence pads exempt from Texas sales tax?
A: It depends on the buyer. They're exempt when sold to an individual under a doctor's prescription, but taxable when sold to hospitals or nursing homes.

Q: Why are incontinence pads taxable when sold to a hospital or nursing home?
A: The letter doesn't give a separate rationale beyond classifying the pads as therapeutic appliances subject to the general rule that such items are exempt only on prescription sales to individuals; institutional purchases don't meet that condition.

Q: Were the other products in this same letter also ruled exempt?
A: Two were: the therapy mattress replacement/overlay system and the sequential compression devices and accessories were both ruled exempt. The patient weighing systems (scales) were ruled taxable.

Q: Why were the patient weighing scales not exempt?
A: The Comptroller found the scales could not be fitted into the categories that qualify for exemption — orthopedic and prosthetic — so there was no basis for exempting them.

Q: Can I rely on this letter for my own incontinence pad sales?
A: No. Texas STAR letters can be relied on only by the taxpayer to whom they were issued, and this opinion is expressly based on the facts presented — different facts could change the outcome.

Q: What kind of documentation supports an exempt sale of incontinence pads to an individual?
A: The letter indicates the exemption applies when the pads are sold to an individual under a doctor's prescription, implying the prescription is the key support for exempt treatment (the letter does not specify additional recordkeeping requirements).

Citations and references

No specific statutes or rule numbers were cited in this letter.

Source

• STAR search: https://star.comptroller.texas.gov/search?doc_type_code=L&tax_type_code=SST
• Opinion: https://star.comptroller.texas.gov/view/9207L1182F01

Original ruling text

July 6, 1992

Dear ***:

Thank you for your recent letter asking about the classification of products
your company sells.

You first asked about Therapy Mattress Replacements and Overlays. You described
this product as a pressure relieving system that reduced pressure and moisture,
the leading cause of pressure scores.

Response: We agree that this pressure relieving system will qualify for
exemption from sales tax.

The next item was the Sequential Compression Devices and Accessories used in
prevention of deep vein thrombosis before, during and after orthopedic surgery.

Response: We agree that the Sequential Compression Devices and Accessories will
qualify for exemption from sales tax.

The third item was the Patient Weighing Systems (Scales). You described these
as weighing systems developed to provide accuracy, linearity, repeatability and
low drift required to provide meaningful patient weight and weight change data
over long periods of time.

Response: We do not agree that the scales qualify for exemption from tax. This
system cannot be fitted into the categories that qualify for exemption which
are orthopedic and prosthetic. There is no basis for exempting the scales.

The fourth item was incontinence pads used in conjunction with the
*** or other beds for the incontinent patient.

Response: The incontinence pads have been categorized, for tax purposes, as
therapeutic appliances. These items are only exempt from tax when sold to
individuals under a doctor's prescription. The items are taxable when sold to
hospitals and nursing homes.

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

If you have any questions or need more information, you may call me toll free
at 1-800-252-5555, extension 3-4633. The regular number is 512/463-4633. You
may also write to the Tax Administration Division.

Sincerely,

Wanda Hutcheson
Tax Administration Division