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.
Is equipment rented or leased for making a motion picture, video, or audio recording exempt from Texas sales tax?
**Yes, effective October 1, 1993, a producer may claim an exemption from tax on qualifying machinery or equipment rented or leased for the production of a motion picture or a video or audio recording,…
When a state, county, city, and industrial development authorities give a company a free plant site, cash reimbursements, grants, and other incentives to locate a factory in Alabama, is the value of those inducements taxable as corporate income — or excludible as a gift?
Excludible as gifts. To induce Company A to build a production facility in Alabama, the State, a county, a city, and two industrial development authorities signed agreements giving Company A a free pl…
When must architects, engineers, or contractors in Texas charge sales tax on copies of blueprints or plans, and when do they instead owe tax as the purchaser?
**It depends on whether the copies are provided to the original client under the professional service agreement, or sold separately to someone else.** When an architect or engineer gives copies of ori…
How did Texas require a seller-financing dealer to report a vehicle sale when the dealer paid all tax at title transfer?
The dealer could pay all tax to the county with timely title and registration documents, but still needed a financing-seller permit. Receipts from that sale went into gross receipts, not taxable recei…
Are hospital gowns sold to a hospital or medical center subject to Texas sales tax?
**Yes — hospital gowns are taxable when sold to a hospital or medical center.** Unless the hospital, nursing home, or other institution itself qualifies for an exemption under Tax Code Section 151.310…
Is a business's fee for picking up and collecting used oil, used oil filters, used antifreeze, and used brake fluid for recycling subject to Texas sales tax?
**No — the Comptroller determined that collection services for used oil, used oil filters, used antifreeze, and used brake fluid to be recycled or re-refined are not subject to Texas sales tax.** The …
Under South Carolina Revenue Ruling 93-11, was a lessor or lessee responsible for property tax on leased real and personal property?
The lessor was generally liable as owner. Liability shifted to the lessee for financing arrangements and specified exceptions, including unit valuation and qualifying 99-year real-property leases; fee…
Which in-state activities did South Carolina Revenue Ruling 93-10 treat as protected solicitation under Public Law 86-272, and which activities destroyed immunity?
Protection covered interstate sales of tangible goods when South Carolina activity was limited to solicitation, ancillary acts, de minimis activity, or specified independent-contractor work. Regular r…
Does a Connecticut manufacturer owe use tax on product displays it buys, stocks with its goods, and gives free to retailers?
It depends on where the retailer is. A hardware maker bought empty product displays from an out-of-state supplier, stocked them with its hardware in Connecticut, and gave the stocked displays free to …
Can a city exempt residential gas and electricity from local sales tax differently — for example, repealing the tax on one energy source but not the other, or only part of the local tax?
**No.** The Comptroller's letter states the answer to both questions is "no": a municipality cannot repeal only a portion of the local tax as it applies to residential gas and electricity, and it cann…
Can 'Direct' distributors in a direct-sales organization get their own sales tax permits, and how do they handle tax on non-company items like tapes, books, and business tools?
**Yes — the Comptroller's office decided that any 'Direct' distributor may obtain a sales tax permit and report tax on their own sales**, reversing prior denials, effective for procedures implemented …
Does a computer software marketing aid built by an out-of-state vendor for a Texas manufacturer qualify for the 'developed from scratch' exemption, and is it taxable even though the master copy stays out of state?
**No exemption applies here, and the software is taxable.** The Comptroller held the Rule 3.308(b)(4) exemption for software "created from scratch" only applies when the software is built for the cust…
Are standalone elevator inspection services subject to New York sales tax?
Yes, when the customer is the property owner or lessee. Inspecting elevators to check code compliance is a diagnostic service that counts as maintaining real property under Tax Law section 1105(c)(5) …
Does a for-profit medical lodging facility have to collect Connecticut room occupancy tax once it is licensed as a health care institution?
No -- once it is licensed. A for-profit 'Medical Hotel' provided short-term rooms, 24-hour nursing care and meals to patients recovering from procedures or treatments. It had a Certificate of Need (Co…
Can a company get a sales tax refund on insurance/actuarial services by prorating the tax based on the ratio of its Texas to out-of-state insurance premiums?
No — the Comptroller denied the refund request. **Prorating insurance service tax based on the ratio of Texas to out-of-state premiums is not a valid method** under Rule 3.355. The letter found the ta…
If a construction contract says the contractor will 'pay all sales taxes,' does that satisfy Texas's tax-included-price rule, and who is liable for the tax?
**No — that contract clause is not enough on its own.** The Comptroller explains that under Rule 3.286(d)(3), a bill, contract, or invoice must either separately state the sales tax amount or contain …
Is a land survey to locate a farm/ranch fence line taxable, even though the fence materials themselves are exempt?
Yes, the survey is taxable. **A land survey to determine or confirm property boundaries is a taxable real property service under Rule 3.356 (Real Property Services), even when the survey is done to lo…
Does a property manager have to collect sales tax on services like security, janitorial, pool, and lawn care that are purchased from independent contractors?
**Yes.** The letter states that taxable services purchased by a property manager from independent contractors are taxable — for example, a pool service, a lawn service, or a janitorial service hired b…
Is a hotel's separate convention center subject to sales tax on room rental, and what happens when meals are served in it?
**Renting the convention center space by itself is not taxable — a rental of real property is not subject to sales tax.** But when meals are served, the analysis splits: charges for meeting rooms wher…
Is a retinal angiographer's x-ray service for ophthalmologists taxable under Texas sales and use tax?
**No — the Comptroller ruled the retinal angiographer is providing a non-taxable health or medical diagnostic service.** Because the service itself is non-taxable, none of the fee (whether for taking …
Is a reading lamp prescribed by an optometrist for vision rehabilitation exempt from Texas sales tax as medical equipment?
**No — the reading lamp does not qualify for the medical equipment exemption.** The Comptroller's response states that the reading lamp described (prescribed by an optometrist, used along with prescri…
If a for-profit company produces a charity booklet and donates all proceeds to an exempt organization, is the sale of the booklet exempt from Texas sales tax?
**No — donating all the proceeds to a nonprofit does not make the sale exempt.** The Comptroller explains that the Section 151.312 exemption for periodicals/writings turns on who publishes or distribu…
Is sales tax due on charges for calls to 900 telephone numbers, and who is responsible for collecting it if the 900 number is sub-leased to another company?
**Sales tax is due on 900-number calls that originate from points within Texas**, and the telecommunications firm that transmits the calls collects the charge — including the tax — from the customer o…
Is finish-out labor on a vacant, never-finished building taxable as remodeling, or exempt as new construction?
**Tenant finish-out labor is taxable as nonresidential remodeling** even on a building that was never finished out before, as long as the building was previously occupied or used in its unfinished (sh…
Is a child identification/registration service (videotape and photo registration in case a child goes missing) taxable under Texas sales/use tax?
**No — the Videotape Registration Service and Photo Registration Service themselves are not taxable**, according to this 1993 Comptroller letter ruling. The company charges $20 for a kit to produce a …
When a developer has a contractor improve realty that will later be sold to a water district, can the contractor buy materials tax-free under Tax Code Section 151.311?
**It depends on who has the contract with the governmental entity.** Effective October 1, 1993, if the water control and improvement district (WCID) itself contracts with the developer for the improve…
If a contractor donates building materials to a tax-exempt airport authority before incorporating them into the building, are the materials and consumable supplies used in the job exempt from Texas sales tax?
**Building materials that a subcontractor purchases under an exemption certificate and donates to the airport before those materials are incorporated into the building are exempt — no tax is owed on t…
Are charges for computer installation, training, troubleshooting, consulting, and network administration taxable in Texas?
It depends on what is being installed and whether you sold it. **Separately stated instruction/training charges are not taxable. Installation of software or external hardware you sold is taxable; if y…
Is the NEEDLYZER needle destroyer device subject to Texas sales tax?
Yes, unless the buyer is exempt. **The NEEDLYZER is taxable unless it is sold to a governmental entity or another organization that qualifies for exemption.** The letter describes the device, per the …
Can a retailer that leases (rather than rents) motor vehicles buy repair and replacement parts for those vehicles under a resale certificate?
Yes. **The Comptroller concluded that Rule 3.294 should be amended to let retailers who lease vehicles purchase repair and replacement parts under a resale certificate, the same treatment already give…
Could a self-financing vehicle dealer pay all Texas sales tax upfront, and would repossession create a refund?
Yes, the dealer could pay all tax at once, but no dealer refund was available if the vehicle was later repossessed. Self-financing dealers still had to register and report, and failure to register the…
Is a consulting and monitoring service that tells a customer when to have their trash compactor emptied subject to Texas sales tax?
No, the consulting and monitoring service itself is not taxable. **Consulting, monitoring, and advising a customer on the fullness of their trash compactor on a stand-alone basis is not taxable**, acc…
Did South Carolina PLR 93-6 apply the historical $300 maximum tax to each item in a university supercomputer system used for research and development?
Yes. Each item qualified because the system was used exclusively to develop software and other R&D products and was housed in a restricted, separately staffed facility devoted exclusively to research …
Does a bank owe sales tax when it forwards checks, imprinters, or electronic capture machines to customers, or when it charges notary fees?
It depends on the bank's role in the transaction. **If the bank simply forwards a customer's order to a vendor and passes through the exact vendor charge, the bank is acting as the vendor's agent and …
If a contractor builds a new exterior wall (with window openings) around an existing building, and adds four new floors, but the new wall doesn't create any usable space, is that new construction or remodeling for Texas sales tax purposes?
It's remodeling, not new construction. **Because the new brick wall built around the existing three-story structure did not create any usable space, the Comptroller ruled that the construction of the …
We're lending over $50 million to a borrower under a revolving credit facility secured by warehouses in multiple states, including one in New York. The New York mortgage caps its own secured amount at a fixed dollar figure well below the total loan, and says all daily readvances and repayments get applied to the OTHER states' collateral first, with the New York amount reduced only by the truly final repayment. Will we only pay New York mortgage recording tax once, on that fixed cap?
Yes -- a one-time tax on the properly capped New York amount, as long as the mortgage's own allocation language controls. BT Commercial Corporation made an over-$50 million revolving loan to a borrowe…
Does a contractor who recovers salvable crude oil while cleaning up waste oil pits and evaporation ponds owe Utah oil and gas severance tax on that recovered oil?
No. The Utah Tax Commission ruled that a contractor cleaning up waste oil pits and evaporation ponds owes no oil and gas severance tax on the crude oil it salvages, because the contractor is not an op…
Are an insurance group's affiliated companies' equipment purchases and leases, made as an agent of a city industrial development agency (IDA) under a bond-financing job-retention deal, exempt from sales and use tax?
Yes, generally -- purchases and leases made as the IDA's disclosed agent are exempt from sales and use tax as long as the IDA genuinely owns the property, and exempt maintenance/repair covers only equ…
Is a subscription regulatory-update newsletter an exempt periodical, or a taxable information service?
It is a taxable information service, not an exempt periodical. The publisher's RCRA Update is a bimonthly service consisting mostly of photocopied Federal Register pages plus staff summaries of EPA ha…
Are recording tape and equipment rentals used to make promotional demo tapes taxable, or exempt as production equipment?
They are taxable. An artist-promotion company bought recording tape and rented equipment to make demonstration tapes it sent free to record companies. Buying tape and renting equipment are taxable ret…
When a kitchen contractor sells cabinets, does it collect sales tax from the customer, or pay tax on its own purchase of the cabinets?
It depends on whether the contractor installs them. If the contractor merely sells the cabinets without installing them, it is making a retail sale and must collect sales tax from the customer under T…
Is a computerized 'check-in' calling service — like a wellness check or latch-key-kid monitoring service that automatically calls emergency contacts if someone doesn't respond — subject to Texas sales tax as a security service?
No, not in this case. **The Comptroller ruled this particular computerized monitor calling service is not subject to sales tax.** The service would be taxed as a security service only if a license wer…
Can a company lease marine cargo containers tax free, and are the cleaning of those containers and the equipment used to clean them also tax exempt?
The lease of the marine cargo containers themselves is tax free, and the cleaning service performed on them is also tax free — but the machinery, equipment, and building used to house the cleaning ope…
How does Utah sales tax apply to a motor vehicle lease where the lessee prepays the entire lease in one lump sum at signing, instead of paying monthly?
The full lump-sum prepaid lease payment is subject to Utah sales tax, all due and payable at lease signing -- not spread out like a conventional monthly lease. The lessor (not the dealership collectin…
How many one-day tax-free sales or auctions can a 501(c)(3) organization and its chapters hold each calendar year in Texas?
Two. **Effective August 30, 1993, a 501(c)(3) organization (and each chapter of the organization) may hold two tax-free sales or auctions per calendar year, each lasting no longer than 24 consecutive …
Was Texas motor vehicle tax due when an owner transferred vehicle title to a living trust created for that same owner's benefit?
No. The Tax Administration Division said motor vehicle tax was not due when a person transferred vehicle title into a living trust established for that same person's benefit.
Is an escort service, body guard service, or massage parlor subject to Texas sales tax, and what does someone need to do to legally operate one?
Yes. **Sales tax is due on all services provided by massage parlors, Turkish baths, or escort services**, including on utilities, equipment, towels, and machinery used to perform the personal services…
Does a directional drilling company have to collect Texas sales tax on its services to well owners?
No, not if it plans and performs the drilling engineering, provides its own equipment and personnel, controls when specialized equipment is attached to the drill pipe, and monitors the drilling to ens…
Is a company that assembles custom sterile and non-sterile medical/dental/first-aid packs a 'manufacturer' for Texas sales tax purposes, and how is tax figured on the packs themselves?
It depends — the company is a manufacturer only for the sterile packs, not the non-sterile ones. The Comptroller ruled that the taxpayer is considered a manufacturer of the custom-designed sterile pac…
Is a school's yearbook sale exempt from Texas sales tax if it is designated as the school's one-day tax-free sale?
Yes. **A public or nonprofit private school that qualifies as a tax-exempt organization can designate its yearbook sale as its one-day tax-free sale, and if it does, the sale is tax-free — even if ord…
Is the fee for filing a lien on a delinquent debt a taxable debt collection service in Texas?
Yes. **Filing a lien for a delinquent debt is a taxable debt collection service under 151.0036 of the Texas Tax Code**, whether it is billed alone or together with other debt collection services, and …
Does a contractor owe sales tax on armored-car transport, delivery, and storage services when it performs them as an authorized agent of a New York State agency?
No. The charges are exempt. The petitioner arranged armored-car transport and bulk storage of federal food-stamp coupons for the New York State Department of Social Services. Storage services (Tax Law…
Does building a warehouse before it's operational create Utah corporate franchise and sales tax nexus, and can a company get relief from filing/collecting until the facility opens?
Nexus is created, but the Commission agreed to defer the resulting tax obligations. A national mail-order retailer planning a roughly one-million-square-foot Utah warehouse and distribution facility a…
Is a per-unit 'production fee' charged under a packaging machine lease a taxable lease charge, or an exempt royalty for use of the machine's patent?
Taxable. The Commission held that a per-unit 'production fee' charged under a patented packaging machine's lease is an additional taxable lease charge — compensating the lessor for equipment wear and …
Is a company's fee for helping a long-term disability insurance claimant apply for Social Security disability benefits a taxable insurance service in Texas?
No. The Comptroller ruled that assisting an insured in applying for Social Security disability benefits is **not taxable as an insurance service**. The company in this letter contracts with long-term …
Is picking up used oil and oil filters from public collection centers for recycling a taxable waste collection service in Texas?
No. **The Comptroller ruled that picking up used oil and oil filters from public collection centers for recycling is not a taxable waste collection service.** The letter explains that the rule coverin…
Is the rental fee for a cryogenic gas vessel that is rented to a customer and refilled at the customer's site taxable, or is the vessel a tax-exempt 'returnable container'?
The rental fee is NOT taxable. In this internal reconsideration memo, the Comptroller's Tax Administration Division agreed that the taxpayer's cryogenic vessels should continue to be treated as tax-ex…
Is a private contractor exempt from sales tax on materials used to build city-owned airport facilities that the contractor then leases back from the city for 15 years?
No, the materials are taxable. **Even though the city immediately owns the airport terminals, hangars, and similar facilities the contractor builds, the contractor is not exempt from sales tax on the …
Is installing a vapor recovery system on an existing underground fuel tank taxable as remodeling, or exempt as new construction?
It depends on timing. **If the vapor recovery system is attached to an existing underground fuel tank, the job is taxable remodeling of nonresidential real property, and tax is due on the entire sales…
Is electricity used to recharge the batteries of golf carts held for rental exempt from Texas sales tax?
Yes, that electricity is exempt. **The Comptroller's Tax Administration Division confirmed that electricity used to recharge batteries on electric golf carts held for rental is exempt, treating it as …
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.