State Tax Rulings
Free state tax letter rulings and advisory opinions with plain-English summaries, full citations, and the original source on every page.
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Was a fee to attend a private social event subject to Illinois sales tax when the fee included restaurant or catered food and drinks?
Admission by itself was an intangible and was not subject to Illinois sales tax, but a ticket or event charge that entitled the attendee to food or drink was taxable. When members bought food or drink…
How did Florida source an education provider's online-course tuition receipts for the corporate income tax sales factor?
The tuition receipts were sales included in the apportionment factor and were sourced where students accessed the online courses. Because students generally accessed from home, Florida-resident studen…
Could a substantially larger and more diversified corporate group revoke its Florida consolidated-return election because its business circumstances had changed?
Yes, subject to conditions. The group's domestic-to-multinational growth and operational changes established good cause, but deconsolidation had a specified effective date, deferred or unrecognized in…
Is bulk water pumped into a vessel's built-in potable or ballast tanks taxable in Louisiana?
No, under the ruling's facts. Bulk water pumped into built-in vessel tanks was exempt whether used by the crew, as ballast, or transferred for drilling operations.
Did Illinois's prepaid wireless 9-1-1 surcharge apply to every prepaid calling card reported for sales tax, including an international access-code card?
The two charges used different definitions. A prepaid calling arrangement was tangible personal property subject to Retailers' Occupation Tax, but the 2012 prepaid wireless 9-1-1 surcharge applied onl…
Could taxpayers subtract both a taxable annuity death benefit and a distribution from an inherited IRA on their 2008 Virginia return?
Only the annuity death benefit qualified. It was a federally taxable lump-sum payment to the beneficiary under an annuity contract, satisfying Virginia's subtraction. The inherited IRA distribution wa…
Which clinical-trial patient-recruitment services -- ads, call centers, tracking, site kits, translation -- are subject to NY sales tax?
Most are not taxable, but the printed materials are. Producing TV/radio ads and websites, running e-mail and direct-mail advertising campaigns, operating screening call centers, and ad-response tracki…
What are South Carolina's latest per capita income figures used to qualify for tax incentives (per SC IL #12-6)?
SC Information Letter #12-6 publishes the state and county per capita personal income figures the Department uses to test qualification for various South Carolina income, sales and use, and property t…
Did selling an interest in a disregarded LLC trigger recapture when the LLC became a partnership but kept using the enterprise-zone property?
Yes. Before the sale, the disregarded LLC and its owner were one Illinois taxpayer. Selling 88% caused the LLC to become a new partnership, and Rev. Rul. 99-5 treated the owner as contributing the qua…
Could an insurer treat gain from selling premium renewal rights as nonbusiness income or exclude it from the premium-factor apportionment formula?
The gain was business income because the renewal rights served an operational function in the insurer's business. It therefore entered the insurer's statutory premium-based apportionment formula. IDOR…
Could an Illinois S corporation subtract the federal payroll-expense disallowance tied to the FICA tip credit?
No. Claiming the federal Section 45B FICA tip credit reduced the S corporation's federal payroll-tax deduction. Illinois allowed subtractions only for the federal disallowances specifically listed in …
Are movies a theater receives from studios taxable in NY when delivered by satellite versus on a hard drive?
It depends on the delivery medium. Movies a theater receives by satellite transmission or otherwise delivered electronically are not subject to sales tax -- they're treated as sales of intangible prop…
Did Virginia sales tax apply to an association's fee for reserving a pavilion or lodge when no property or other services came with it?
No. The property owners association charged members and leaseholders in good standing to reserve a beach pavilion or lodge for meetings, parties, and community events. Because the reservation applicat…
Which marketing-firm audit items did Virginia remove, and could creative pass-through costs or appeal interest also be abated?
Virginia granted only documented adjustments. It removed specified items mailed or shipped to the Washington, D.C. customer and reduced the contested sales measure by the documented 35% non-Virginia m…
Were a telephone company's fixed-price equipment transactions exempt repairs, and did its spreadsheet prove credits for Internet-service equipment?
Not with the evidence presented. The supplier invoices looked like fixed-price product transfers, and the contract permitted advanced replacements and other exchanges, so the company did not prove tha…
Did a telephone company prove that supplier charges were exempt repairs or that taxed equipment qualified for Virginia's Internet-service exemption?
Not with the submitted records. The invoices charged for products and the contract allowed advanced or replacement equipment, so the company did not prove that each charge covered only a separately st…
What happened when a taxpayer did not report an IRS income adjustment but later said she was only a part-year Virginia resident?
Virginia was authorized to assess the IRS adjustment because the taxpayer did not file the required amended Virginia return. But her original return had treated her as a full-year resident, while she …
Could a country club exclude member payments collected for pro shops, golf associations, and an employee fund from BPOL gross receipts as pass-through money?
Not on the evidence provided. Although the club kept separate accounts for payments collected for pro shops, golf associations, and an employee appreciation fund, it did not substantiate the required …
Could beneficiaries subtract federally taxable annuity death-benefit payments from Virginia income when the benefits were not paid in a lump sum?
No. Virginia required an annuity death-benefit payment to come from an annuity contract, be awarded to the beneficiary in a lump sum, and be federally taxable. The wife's survivor annuity payments fai…
Did an out-of-state employer owe Virginia withholding for employees working in Virginia when it lacked detailed payroll records?
Yes. A nonresident employer can owe Virginia withholding when employees earn wages from services performed in Virginia. Because the corporation kept no detailed employee records, Virginia reasonably e…
Could a flooring seller keep tax collected on lump-sum invoices by later treating labor as separate, and could Virginia estimate sales when invoices were missing?
No. The seller collected sales tax on the full lump-sum customer charges, then revised the invoices internally to separate labor and remitted less tax without refunding customers. Virginia required it…
Which natural-gas well items qualified for Virginia's pollution-control or direct-use exemptions in this superseded ruling?
Historically, Virginia removed DMME-certified pit liners, fluid-collection tanks, and silt fence purchased before the pollution-control exemption expired on July 1, 2006. It kept tracer wire and stone…
Did replacement baking pans and labor to re-glaze or straighten them qualify for Florida's industrial-machinery repair exemption?
Yes. Pans with a depreciable life of at least three years were industrial machinery and functionally integrated with the ovens because the baking process could not operate without them. Replacement pa…
Could taxpayers contest unpaid tax from their 2005 return by saying an IRS dispute was pending without filing a complete Virginia appeal?
No. The taxpayers' letter did not identify an assessment error, relevant facts, grounds, or controlling legal authority, despite repeated requests for information. Virginia denied the incomplete appea…
Could a graphic printer overturn tax using incomplete or post-audit exemption certificates and unsupported resale or manufacturing claims?
No. Virginia held that incomplete, invalid, facially inconsistent, or inapplicable certificates did not protect the printer, especially when obtained after the audit rather than relied on at the time …
Is a sweetened chocolate product taxable candy in NY, and does selling through in-state independent reps require registering as a vendor?
The chocolate is taxable, and the reps may trigger registration. A sweetened chocolate product sold in wrapped pieces is candy or confectionery, which is excluded from the food exemption and taxable -…
We're a public benefit corporation created by state law to build office facilities for the UN. Our enabling statute says our 'income and operations' are tax-exempt. If we record a mortgage to finance a new construction project, is that mortgage subject to mortgage recording tax?
Exempt. The petitioner is a public benefit corporation created by a 1968 state statute (later amended in 2011) to coordinate development of office and other facilities near UN Headquarters in New York…
Were separately stated, optional sign-permit and site-survey charges excluded from Virginia sales price as services, pass-through fees, or installation?
No. Manufactured signs were taxable tangible personal property, and the permit and site-survey charges completed or supported those sales. Virginia found no statute excluding the charges merely becaus…
Was an electrical contractor's purchase of a generator from its owner an exempt occasional sale, and could audit interest be waived?
Virginia removed the generator from the audit because the facts supported the occasional-sale exemption for its transfer from the contractor's owner. Virginia did not reduce interest: interest was man…
Which printer sales were supported by exemption certificates, and was separately stated postage taxable?
Virginia decided each exemption certificate by whether a reasonable dealer could conclude that the particular goods were covered. It removed direct-mail statements, flash drives and lanyards, and pens…
Is GPS-based precision-farming tower equipment exempt from Kansas sales tax as farm equipment?
Exempt. The GPS receivers, radios, antennas, cables, electrical boxes, and stand that make up a Real Time Kinematic (RTK) tower — used exclusively to send and receive signals for precision-farming gui…
Were golf green fees inside a single-price accommodation package taxable, and were the audit penalties waived?
The green-fee portion was taxable because a single-price accommodation package is taxed in full. For this audit, however, Virginia abated the green-fee tax and interest because the taxpayer's detailed…
Which items and services bought to expand a Tennessee manufacturing plant qualify for the industrial-machinery sales-and-use-tax exemption — and can the manufacturer's contractors buy them tax-free?
Most of it is exempt, but not all. The Department (in an advisory revenue ruling) applied Tennessee's INDUSTRIAL MACHINERY exemption (Tenn. Code Ann. § 67-6-206(a)) to a long list of items a manufactu…
Was a multistate commercial printer a manufacturer for Virginia local BPOL and business-property taxes?
Yes. Virginia considered the printer's facilities as one business rather than isolating the county's direct-mail location. Its printing transformed raw materials and its manufacturing operations were …
Were amusement-equipment rentals exempt services when a trained operator stayed with the equipment?
No. Virginia found that the customers' true object was renting the amusement equipment. Although trained operators remained on site, their work mainly ensured proper setup, tethering, and participant …
Did a campground owe tax on park trailers used as cabins, and did it have to tax campground accommodations?
Yes. Virginia classified the wheeled, detachable-hitch park trailers as tangible personal property rather than modular buildings. The campground was the consumer of trailers used to provide accommodat…
Were flat fees paid to a company that managed retirement facilities' dietary departments taxable sales of food?
No. The management company procured, prepared, and served the food while retaining its possession and ownership, so it transferred no tangible personal property to the retirement facilities. Virginia …
Were per-patient fees for operating a healthcare facility's dietary department subject to Virginia sales tax?
No, under the provider's current scenario. It bought raw food, paid tax on the purchases, retained title, prepared and served meals in the customer's facilities, and charged one per-patient daily fee …
Was proprietary software licensed for integration into a customer's product exempt from Illinois sales tax merely because it was not stand-alone and would be sublicensed?
Not automatically. Software that was not custom remained taxable canned software even when it was not stand-alone or was delivered electronically. A license avoided Retailers' Occupation Tax only if i…
Should deed and grantor taxes use the sale consideration when the property's assessed value was higher?
Not automatically. Virginia recordation and grantor taxes use the greater of consideration or the property's actual value. Assessed value has a strong presumption of accuracy, but the circuit-court cl…
Could a city use a vehicle pricing guide to value taxicabs for local business-property tax?
Yes, if the method is uniform within the taxicab class and reasonably estimates fair market value. Virginia found the city's guide-based method facially acceptable and said using a different method fr…
Did a military spouse qualify for Virginia income tax protection when she obtained a Virginia driver's license and established domicile in Virginia?
No. The military-spouse protection required the spouse and service member to share the same out-of-state domicile. Virginia found that the spouse acquired Virginia domicile in 2007 after establishing …
When were a caterer's sales to nonprofits or governments exempt, and which exemption certificates could support the sales?
Virginia treated catered food as a taxable service because food preparation accompanies the sale. Nonprofits generally owed tax unless their statutory exemption expressly covered taxable services, and…
Could an HVAC contractor avoid use tax by saying its vendors included sales tax inside sheet-metal invoice prices?
No. Virginia requires sales tax to be shown separately on the transaction record, and the purchaser remains liable when it cannot establish that sales or use tax was paid. A notarized vendor statement…
Could taxpayers subtract unemployment benefits again when calculating the income limit for Virginia's age deduction?
No. Virginia said the federal unemployment exclusion was already recognized in federal adjusted gross income and required no fixed-date-conformity adjustment. Although Virginia allowed a separate subt…
Could a yarn manufacturer buy nonreturnable strapping exempt when it passed to customers with shipped products?
Yes, under the resale exemption—not the manufacturing packaging exemption. Virginia treated strapping as a taxable transportation device rather than material that places goods into a wrapper or contai…
Could Virginia consider a consumer-use-tax appeal filed one day after the ruling's stated 90-day deadline?
No. Virginia strictly enforced the 90-consecutive-day appeal period and said the faxed appeal arrived one day after the deadline, so it could not consider the merits. The taxpayer had paid the origina…
Was a Virginia nonfiler's assessment unsupported when the Department relied on wage, dividend, and interest data from the IRS?
No. IRS information showed 2008 wage, dividend, and interest income and gave Virginia a factual basis to estimate tax when the taxpayer filed no return or response. The assessment was presumed correct…
Which cleaning, storage, forklift, and furniture items qualified for relief in a food manufacturer's use-tax reconsideration?
Virginia denied relief for floor scrubbers used between production runs and racks storing finished goods because neither was an immediate part of production. Forklift lease charges remained taxable du…
Was a corporate president personally responsible for unpaid business taxes when another manager had the specific filing and payment duty?
Apparently not on the facts presented. Although the president later knew of the liabilities, could prevent future failures, and may have willfully left some known amounts unpaid, the studio manager—no…
Could Virginia decide whether a minimally involved vice president would be personally liable before any business taxes were converted?
Not on the record provided. No business tax had yet been converted to the taxpayer, so the appeal was premature and Virginia treated it as a ruling request. Minimal involvement did not itself prove an…
Were an owner and a retired corporate secretary personally liable for a closed business's unpaid Virginia taxes?
No on the facts presented. The 50% owner was not an officer or employee with a specific corporate duty, and the ruling understood that person's converted assessments had already been canceled. The ret…
Were pallets used to ship imported finished rugs exempt as manufacturing or packaging materials?
No. Adding a hanger or label to an imported finished rug did not create a new product, so that work and the related pallets belonged to taxable distribution rather than manufacturing. Pallets were tra…
How should a Virginia contractor assign out-of-state construction receipts and job-site wages in its apportionment factors?
Virginia sent the assessment back for more work. The contractor had not documented all direct and headquarters costs by contract well enough to prove where the greater cost of performance occurred for…
For BPOL tax, could a gas producer remove value added after gas entered transit at the county wellhead?
Yes. Because the gas was placed in transit at the county wellhead for sale elsewhere, BPOL gross receipts had to reflect fair market value at that point, not later value added before sale. Sale procee…
What did Virginia's original Barge and Rail Usage Tax Credit guidelines require before they were superseded?
Under these superseded guidelines, a qualifying international trade facility could claim $25 for each full TEU moved by barge or rail above its prior-year volume instead of by highway. The claimant ha…
What did Virginia's original 2012 International Trade Facility Tax Credit guidelines require before they were superseded?
Under these superseded guidelines, a company with at least a 10% increase in qualifying Virginia port cargo could elect either $3,000 per qualified full-time employee or 2% of qualifying capital inves…
How far back could a Virginia town recover communications and E-911 taxes billed despite its government exemption?
The town was never subject to Virginia communications sales tax or E-911 tax as a political subdivision, but the billing-error remedy limited this claim to the two years before its September 7, 2011 r…
Would Illinois tax a future Florida resident's gain from selling stock in an Illinois corporation?
Generally not if the gain was nonbusiness income from intangible stock. But IDOR lacked enough facts to decide whether this owner's future sale gain would instead be business income. If it was busines…
Must a New York gun dealer (FFL) collect sales tax when transferring a firearm the buyer purchased from an out-of-state seller, and is its transfer fee taxable?
No on both. When a New York buyer purchases a gun directly from an out-of-state seller (FFL) and pays that seller, federal law requires the gun to ship to a New York FFL who runs the background check …
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