State Tax Rulings
Free state tax letter rulings and advisory opinions with plain-English summaries, full citations, and the original source on every page.
No rulings match these filters
Try a different search term or clear the filters.
New York Advisory Opinion TSB-A-12(4)C / 12(7)S: Does a not-for-profit electricity Independent System Operator become subject to corporate franchise tax or lose its sales-tax exempt status by adopting a central counterparty structure under FERC orders?
No. A not-for-profit Independent System Operator that adopts a central counterparty structure -- becoming a party to all transactions in the electricity markets it administers under FERC orders -- doe…
Could taxpayers deduct motor-home loan interest even without Form 1098 or real-estate tax on the vehicle?
Yes. A lender did not have to issue Form 1098 because a motor home generally is not real property, and paying real-estate tax was not the test. The motor home contained sleeping space, a kitchen, and …
Could Virginia estimate a floor-covering dealer's sales tax from a prior audit when current records were inadequate?
Yes. The dealer supplied unsigned federal returns and monthly income statements but did not reconcile them to reported taxable sales or provide other valid data. Virginia therefore allowed the auditor…
Should guaranteed payments to a New Mexico LLC member for serving as CEO be allocated entirely to New Mexico or apportioned among the states where the LLC operated?
They were allocated entirely to New Mexico. Stuart Schoenmann was an LLC member but continued performing the same CEO services for which he previously received a salary. The decision treated him as an…
Did pre- and post-judgment interest awarded with specific performance enter the documentary-stamp-tax consideration for a Florida deed?
No. The deed was taxed on the agreed contract sales price. The court-awarded interest compensated the seller for the unavailability of the sales funds and was not consideration paid for the real-prope…
Could Virginia keep an itemized-deduction adjustment after the IRS withdrew it and the ordinary assessment period expired?
No. Virginia could assess the unreported income change at any time because the taxpayer failed to report the final federal change, and the taxpayer accepted that part. But once the IRS withdrew its it…
Did federal qualified-funeral-trust treatment require Virginia to tax the trust at its lowest fiduciary rate?
No. Federal QFT status required a Virginia fiduciary return, but Virginia conformity did not import a federal lowest-rate treatment that conflicted with state law. Virginia taxed the trust's total Vir…
Did assigning, amending, and restating a Florida mortgage loan at a reduced principal balance trigger additional documentary stamp or nonrecurring intangible tax?
No, if each renewal stayed at or below the original unpaid balance, kept the same obligor, and attached the original tax-paid note. The matching mortgage was exempt, and assignment to a new lender did…
Did an out-of-state lessor selling an off-lease vehicle located in Illinois use seller Form ST-556 or have the buyer file Form RUT-25?
The lessor had to file Form ST-556, not rely on the purchaser's Form RUT-25. Illinois treated a lessor selling an off-lease passenger car as a retailer, and a vehicle located in Illinois when sold gen…
Did federal qualified-funeral-trust treatment require Virginia to tax the trust at its lowest fiduciary rate?
No. Federal QFT status required a Virginia fiduciary return, but Virginia conformity did not import a federal lowest-rate treatment that conflicted with state law. Virginia taxed the trust's total Vir…
Are separately stated transportation/delivery charges subject to Colorado sales tax, including in a drop-shipment where goods ship directly from the manufacturer to the customer?
It depends on separability. Transportation of goods between a retailer and a buyer is presumptively a NON-TAXABLE service, but a delivery charge is excluded from sales tax only if it is BOTH (1) separ…
Is the product delivered by an Application Service Provider (ASP) — such as an electronic sales-tax-rate lookup accessed over the internet — subject to Colorado sales and use tax?
Generally not taxable software, but the Department didn't decide this specific product. Colorado taxes tangible personal property, and effective July 1, 2012, computer software is taxable only if it i…
When a steel fabricator does internal fabrication work, or buys fabrication services from a third party, are those labor costs subject to Colorado sales and use tax?
It depends on who fabricates, who supplies the materials, and what happens to the goods. Colorado taxes the FULL purchase price of articles made to order, INCLUDING the fabrication labor, even if labo…
New York Advisory Opinion TSB-A-12(3)C: Will the Department respect an Empire Zone certificate transferred to a corporation after a stock purchase and name change, and when does its sales-tax benefit period end?
Yes. The Department will respect an Empire Zone certificate of eligibility that the Department of Economic Development transfers to the surviving corporation after a stock purchase and name change (th…
Did a hotel-room membership reseller owe Illinois Hotel Operators' Occupation Tax on its full member charge or only the hotel's discounted room price?
IDOR did not answer whether the membership club owed tax on its $40 markup or whether the taxable amount was $100 or the hotel's $60 receipt. It explained that Hotel Operators' Occupation Tax is impos…
Did independent sales managers, local installers, and direct shipments from Illinois require a Missouri LED-sign seller to collect Illinois tax?
IDOR declined to decide the seller's nexus, saying those facts were better developed in an audit. Under the historical framework it described, physical presence included an agent or representative and…
How can taxpayers check whether an older South Carolina advisory opinion was modified or superseded (per SC IL #12-4)?
Use the citator attached to SC Information Letter #12-4. It helps you determine what effect newer South Carolina advisory opinions have on previously published ones — whether an opinion was modified, …
Did one Virginia home-based salesperson create corporate-income and employee-withholding obligations for an out-of-state seller?
Corporate-income tax depended on the salesperson's actual duties. If all Virginia activity stayed within solicitation, ancillary activity, or de minimis conduct protected by P.L. 86-272, the seller wo…
Could incarceration excuse personal-income-tax refund claims filed after New Mexico's three-year statutory deadline?
No. Mark Serros filed 2004, 2005, and 2006 personal income tax returns claiming refunds in September 2011, after the respective refund deadlines at the ends of 2008, 2009, and 2010. Although he had be…
Was scheduling and playout software sold to radio, television, and cable broadcasters exempt from South Carolina sales tax?
Yes. When sold to a radio station, television station, or cable television system, the scheduling and playout software was exempt even on tangible media because it was a part of the dedicated server u…
Did Wendy's qualify for Virginia's related-member royalty add-back exception when its affiliate received unrelated royalties indirectly?
Yes. Oldemark owned Wendy's marks and received a 3% royalty through Wendy's, while Wendy's sublicensed the marks to related and unrelated restaurants at 4%. Because at least one-third of Oldemark's gr…
Did Virginia servers and a salesperson create income-tax nexus for an out-of-state online marketing company?
Apparently yes. Even if the salesperson stayed within protected solicitation, the company's Virginia-owned servers delivered online profiles and marketing services rather than merely supporting sales …
Could a grocery store overturn estimated tax and penalties after collecting sales tax but failing to file and remit it?
Not on the existing record. The store lacked sales and accounting records, so Virginia accepted an observation-based estimate and the taxpayer did not prove it unreasonable. The 50% fraud penalty rema…
Was a proposed sale of installed distributed-antenna-system equipment a taxable retail sale, a resale transaction, or a construction contract?
IDOR did not classify the proposed DAS transaction. If equipment was bought with the intent to resell it, the first purchase could be for resale and the later sale would be a taxable retail sale, supp…
Were management fees between an S corporation and tiered family partnerships exempt BPOL affiliated-group receipts?
No for fees involving the first- and second-tier partnerships. The commonly owned S corporations met the brother-sister affiliated-group test, but the S corporation and first-tier partnerships failed …
Did additional construction-business records reduce a couple's 2004 and 2005 Virginia income assessments?
Yes, in part. The appeal records still did not support the amounts originally reported, but they showed that the audit had allowed no construction-business expenses and justified revisions. Virginia a…
Did a prescription for asthma or chemical-sensitivity relief make an air purifier or filter eligible for Illinois's reduced medical-appliance tax rate?
Not automatically. A medical appliance had to be intended by its manufacturer to directly substitute for a malfunctioning part of the body. A physician's or other licensed professional's prescription …
Could a Virginia day care center remove use tax from fixed-asset purchases by stating that sales tax had already been paid?
No. The day care center said sales tax had been paid on several fixed-asset purchases but provided no supporting documents. Because Virginia imposes use tax on tangible personal property used in the s…
When did a charitable remainder unitrust have to file an Illinois fiduciary income-tax return?
A charitable remainder unitrust followed the same Illinois income-reporting and payment rules as another trust. It filed Form IL-1041 when it had Illinois net income subject to tax. A resident trust a…
Did an out-of-state part-year return change Virginia's finding that a taxpayer became domiciled in Virginia in May 2007?
No. The other state's part-year return confirmed that the taxpayer left that state in April 2007 but did not show where she established domicile afterward. Virginia retained its finding that she becam…
Could a fabricator rely on an ST-587 manufacturing exemption certificate issued by its customer's customer, or did its direct customer need to certify each purchase?
The fabricator needed exemption documentation from its direct purchaser for each transaction. The purchaser could provide Form ST-587 or another certificate containing the required information. A cert…
Are cable TV charges like basic cable, pay-per-view, converter box rentals, and installation or repair labor taxed under Utah's Multi-Channel Video/Audio Service Tax, the sales tax, both, or neither?
It depends on which of three buckets the charge falls into. Programming content (basic/expanded/premium cable, video-on-demand, pay-per-view, DVR service, and connect/disconnect fees) is subject ONLY …
Could a Virginia resident employed by NATO exclude qualifying foreign earnings from 2010 Virginia taxable income?
Yes. The taxpayer documented that NATO—not a United States agency—employed her under a three-year contract as a NATO International Staff member throughout 2010. Virginia therefore allowed the IRC § 91…
Was a farm-harvesting contractor entitled to attorney fees after the Department granted his gross-receipts-tax refund only after he protested?
Yes. Abelardo Ortiz substantially prevailed when the Department granted his $31,264.88 gross receipts tax refund before the hearing. The Department had repeatedly requested invoices but never told him…
Is a natural-gas utility's fixed monthly customer charge taxable when the customer uses no gas that month?
Yes. A natural-gas utility's fixed monthly charge was part of the taxable gross proceeds from selling gas even when the customer used no gas during that billing period. If the customer's underlying na…
Was software downloaded electronically at the customer's location subject to South Carolina sales and use tax?
No. Software transferred from the seller's laptop to the buyer's computer through a wired or wireless electronic connection was not taxable when no tape, disk, flash drive, backup, or other tangible c…
How does NY sales and use tax apply to a stair and railing manufacturer that also installs its products?
As a fabricator that installs its own product, the company is a contractor. Installing or entirely replacing stairs is generally a nontaxable capital improvement, so its charges to sell-and-install st…
Was a well-drilling truck rated at 26,001 pounds or more subject to Virginia retail sales and use tax?
No. Virginia held that a truck, tractor trailer, or semitrailer with a GVWR or GCWR of at least 26,001 pounds remained exempt from retail sales and use tax even though the motor vehicle sales and use …
Did a Florida county's direct-purchase procedures qualify port construction materials for the governmental sales-tax exemption?
Yes, if the county truly ordered, paid, took title, bore risk of loss, received invoices, and issued certificates itself. Earlier nonqualifying purchases could not be repaired retroactively; a control…
Were prescription drugs paid through Medicare Part D exempt from Illinois tax, and how did a pharmacy calculate and collect Service Occupation Tax?
Medicare Part D drug sales were not government-exempt because private prescription drug providers, not the government, purchased the drugs. The pharmacy had to use one of four serviceman methods. IDOR…
Could a manufacturer replace a city's original-cost machinery valuation with the price paid in a bankruptcy sale?
Not automatically. Virginia held that the city's percentage-of-original-cost method complied with the machinery-and-tools statute, and a bankruptcy purchase price did not necessarily establish fair ma…
Could retired U.S. citizens abandon Virginia domicile by moving permanently to a foreign country?
Yes. U.S. citizenship did not prevent the couple from abandoning Virginia domicile and establishing domicile in a foreign country. Virginia found that the wife changed domicile when she moved there in…
Did regularly arranging Illinois repair services through local independent contractors create Illinois income-tax nexus for an out-of-state LLC?
IDOR did not make a definitive nexus determination because the issue was highly fact-dependent and normally resolved in an audit. It warned, however, that regularly arranging and controlling Illinois …
Did an Illinois E number exempt a customer from tax on wireline service billed monthly in advance, as though it were a prepaid calling arrangement?
No. Billing recurring subscription charges in advance did not convert wireline service into a prepaid telephone calling arrangement. Ordinary telecommunications remained subject to Telecommunications …
How did Virginia allocate deductions and treat another state's National Guard pay when resident and nonresident spouses filed separately?
Virginia returned the itemized-deduction allocation for correction because the audit had included the nonresident spouse's combat pay in its proportional calculation. But the Virginia resident's State…
Could a taxpayer reduce Illinois asset-sale gain because old losses that reduced basis had expired before they could be used as Illinois carryovers?
No. Illinois began with properly computed federal taxable income, including the federally determined sale gain, and Section 203 contained no basis adjustment or equivalent subtraction for losses that …
Did a Minnesota resident owe Illinois income tax on compensation earned entirely from Illinois work?
Yes. Illinois taxed a nonresident's compensation earned from work in Illinois. The taxpayer could not use Illinois's resident credit to shift the tax to Minnesota because that credit was available onl…
In a points-based rewards program, is the 'per point' fee the operator charges its client companies taxable, and does Tennessee sales tax apply to the reward merchandise shipped to participants — and on what amount?
It splits two ways: the program fee is NOT taxable, but the reward merchandise IS. The Department ruled on a points-based incentive/rewards program run for client companies — participants earn 'Points…
Could a taxpayer amend old Bright Start contribution years instead of adding a nonqualified 2011 withdrawal back at the higher 2011 rate?
No. The 2008–2010 returns were correct when filed because the taxpayer actually made qualifying Bright Start contributions and properly claimed the subtraction. The nonqualified withdrawal occurred in…
Did certification as a pollution-control facility exempt a Virginia landfill business from city BPOL tax?
No. Virginia held that Va. Code § 58.1-3660 exempts certified pollution-control real and tangible personal property from local property tax; it does not exempt the privilege of operating a business fr…
What Virginia tax interest rates applied during the second quarter of 2012?
Virginia's second-quarter 2012 rates were 5% for tax underpayments and 5% for overpayments. The reduced rate for qualifying assessments under administrative appeal was 0% after nine months until the D…
Could a concrete subcontractor deduct 2002 receipts without timely, correctly issued NTTCs, and was its reliance on accountants enough to abate the penalty?
The deductions were denied because the required NTTCs were not timely obtained in the sole proprietor's name, but the penalty was abated because the owner proved reasonable reliance on his accountants…
Must Virginia deed and grantor's tax use assessed value when it exceeds the sale consideration?
Not always. Recordation and grantor's tax use the greater of consideration or actual value, and assessed value carries a strong presumption of accuracy. But a circuit-court clerk may consider clear an…
Are cardiac ventricular-assist devices, their components, supplies, service, and training exempt from NY sales tax?
Yes, essentially all of it is exempt. The heart devices assist permanently malfunctioning heart ventricles, so they qualify as prosthetic aids and are exempt under Tax Law 1115(a)(4); their external c…
Someone pledges their house as collateral for a bail bond, signing a contingent mortgage that only becomes payable if the bond is forfeited. Is recording that contingent mortgage subject to New York's mortgage recording tax even though no money changes hands unless forfeiture happens?
Yes, mortgage recording tax is due. A bail bond insurance company/agency posts a bond to secure a criminal defendant's release; as collateral, the person putting up the bond (the mortgagor) pledges re…
An LLC acquired a shopping-center site as a nominee/agent for its two members, who are each solely responsible for developing and funding their own separate future condominium unit. Once construction and the condominium declaration are complete, the LLC will distribute each member's designated unit to that member. Is this distribution exempt from New York's Real Estate Transfer Tax as a mere change of form, since each member always had the sole economic interest in its own unit?
Yes, exempt. An LLC ('the Company') acquired a shopping-center site as nominee/agent for its two corporate members, each of which funded the acquisition with its own money and would independently deve…
Was a Florida warranty deed taxable when it transferred only a life estate to the owner's parents and returned the remainder to the grantor?
No. The proposed deed conveyed only the right to possess and use the property for the life tenants' lives, while the grantor retained fee-simple ownership subject to that life estate. The Department t…
Was a university's purchase of a billing server exempt when the server also held records and generated bills for a taxable nonprofit subsidiary?
IDOR did not decide the shared server's exemption. It explained that an organization with an active E number could buy tangible personal property tax-free only when the purchase furthered that exempt …
How was the de minimis serviceman cost ratio computed, and when could a service provider treat transfers to a nonprofit customer as tax-exempt?
The cost ratio used only the annual cost of tangible personal property actually transferred to service customers—not equipment, maintenance, repairs, or supplies that were merely business costs. A 501…
Who qualified for Virginia's original Port Volume Increase Tax Credit, how was it calculated, and how did taxpayers apply?
Under these superseded 2012 guidelines, a manufacturer or distributor of manufactured goods generally had to own the cargo, use a Virginia port, and increase cargo volume at least 5% over its base yea…
How these rulings are useful
- See how the rule applies: A letter ruling shows how a state revenue department actually applied the tax law to a specific business and set of facts.
- Plan with confidence: Find a ruling with facts close to yours before you charge, remit, or claim an exemption.
- Binding only on the requester: A ruling is binding on the department only for the taxpayer who asked. It is persuasive, not a substitute for your own ruling or professional advice.
- Research across states: Compare how different states treat the same issue, from SaaS and food exemptions to nexus and contractor purchases.