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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Does a cable-TV operator owe sales and use tax on the materials it builds into its system and on the tools, vehicles, and equipment it uses to operate?
Yes. Seneca Cable TV owes New York State and local sales and use tax on both (1) the materials it assembles or builds into its buildings, head end, trunk distribution system, and test equipment, and (…
Does a settlement reached at a pre-hearing conference in another taxpayer's case resolve the taxable status of a similar transaction for a different taxpayer?
No. Cinema Shares International Distribution Corp., a film distributor, asked whether the taxable status of its transaction with Home Box Office (HBO) was resolved by a Tax Appeals Bureau 'determinati…
Is reimbursing an advertising agency for production costs — artwork and layouts the agency uses in placing your ads — a taxable transaction for the advertiser?
No. Cinema Shares reimbursed advertising agencies for production costs — layouts, artwork, and similar material the agencies produced and used in placing ads on Cinema Shares' behalf, and which were n…
New York Advisory Opinion TSB-H-80(104)S, (104)I: Does an employer awarding a compact car to an employee through a perfect-attendance drawing trigger New York withholding tax and sales tax, and when are they due?
Both taxes apply, and both are due immediately at the time the car is transferred. The value of the car is 'wages' for federal withholding purposes (compensation paid in property other than cash), and…
Is the New York Insurance Exchange exempt from New York State and local sales and use tax?
No. The New York Insurance Exchange, a not-for-profit corporation created under Insurance Law § 425-a to provide a facility for reinsurance and certain other underwriting, is not exempt from New York …
Our federal return showed positive taxable income, but because the Federal Job Credit forced us to give up a wage-deduction on our federal return, New York lets us subtract that same disallowed wage amount from our New York entire net income -- which put us into a New York net operating loss for the year, even though we had none federally. Can we carry that New York-only net operating loss back to earlier tax years for a refund?
No. Allied Fence, Inc. reported taxable income of $2,380.35 on its federal return for the fiscal year ending January 31, 1979, but claimed a Federal Job Credit of $6,960.91, which under I.R.C. § 280C …
If a vendor gets a properly completed Exempt Use Certificate for replacement parts, must the buyer also separately tell the vendor whether the parts last more than one year?
No. A purchaser buying replacement parts for production machinery does not have to separately advise the vendor about the parts' useful life beyond what a properly completed Exempt Use Certificate (Fo…
Did Texas treat mobile office trailers as motor vehicles subject to rental tax, and could customers use a direct-pay permit?
Yes. Mobile office trailers remained motor vehicles even when their wheels, axles, and towing devices were removed, so Texas rental tax applied under the historical definition. A limited-sales-tax dir…
Is motor fuel burned off-highway in land-improvement and construction work subject to Kansas sales or use tax, and when is it exempt?
Yes. Motor fuels (gasoline, gasohol, diesel, and L-P gas) consumed off-highway in equipment building farm ponds, terraces, waterways, grading, landscaping, or preparing building sites were subject to …
Was Texas motor vehicle tax due when a corporation retitled vehicles solely because it changed its legal name?
No. A corporate name change did not create a taxable vehicle transfer. The corporation could retitle vehicles from its old name to its new name by writing “change in corporate name - no tax due” in Se…
Were mobile lighting systems and air compressors motor vehicles or movable specialized equipment for Texas tax?
They were not motor vehicles. The brochures showed units designed and built for specialized functions and not designed to carry divisible highway loads, so Texas treated them as movable specialized eq…
Were vehicle freight charges and dealer documentary fees included in the historical Texas motor vehicle tax base?
Pre-sale freight or shipping was taxable because it formed part of the vehicle's cost. Transportation after the sale was not taxable. A dealer documentary fee for preparing paperwork and handling the …
What proof did Texas require for a large refund claim based on omitted fair-market-value deductions for lease vehicles?
Texas required an audit because the claim covered many vehicles. The company needed detailed amended green dealer/lessor affidavits with original tax-receipt numbers and license plates for both replac…
Could a company's volunteer fire department qualify for Texas motor vehicle and sales tax exemptions?
Yes if the department was an identifiable entity within the company and employees received no additional compensation for firefighting. Vehicles it purchased for firefighting or emergency medical serv…
Was a drilling rig permanently mounted on a truck taxable as a motor vehicle or movable specialized equipment?
The truck-mounted rig was a motor vehicle. A truck remained subject to motor vehicle tax despite attached drilling accessories or limited highway use. By contrast, a mobile drilling rig constructed as…
Was a separately stated collision-damage-waiver charge excluded from Texas motor vehicle rental receipts tax as insurance?
No. Separately stated fees for actual insurance were excluded from gross rental receipts tax, but a collision damage waiver was taxable. The customer was not buying insurance coverage; the charge mere…
How did Texas calculate and document fair-market-value deductions for retired business or personal vehicles?
The retired vehicle had to leave business or personal use and be sold or held exclusively for resale. Its actual depreciated book value at retirement was the deduction; a fully depreciated vehicle pro…
Can Texas's 1979 motor vehicle classification and exemption Q&A still be relied on?
No. STAR marks the document completely superseded as of January 14, 2020. It preserves historical answers on semi-trailers, mopeds, industrial fire trucks, road graders, minors, low-value vehicles, do…
What historical qualification, deduction, affidavit, minimum-tax, and enforcement rules applied to Texas rental-vehicle businesses?
A rental business qualified by renting at least five different vehicles within 12 months and filed a new application upon reaching that threshold. A retired vehicle had to be offered for sale with no …
How did Texas determine leasing-company status, tax rebuilt vehicles from parts, and review transfer affidavits in this field FAQ?
A leasing firm had to regularly and actively lease vehicles as a primary business function and lease at least five different vehicles within 12 months. Building a vehicle from out-of-state component p…
What did Texas's 1979 motor vehicle rental Q&A say about trade-ins, dealer plates, permits, tax receipts, and fleet records?
The historical Q&A limited trade-ins to other motor vehicles, barred rental use on metal dealer plates, required tax receipts on every title transfer, and assigned permit and exemption-certificate rec…
Did a Texas resident stationed elsewhere owe use tax when registering an out-of-state purchased vehicle in Texas?
Yes. Texas imposed use tax on an out-of-state retail purchase brought for highway use by a Texas resident, domiciliary, or business. Registration created an administrative presumption of Texas use eve…
Who paid Texas tax on a doghouse or crewhouse trailer sold to a Texas customer, and could Oklahoma tax reduce it?
The purchaser owed the historical Texas motor vehicle tax when registering a doghouse or crewhouse trailer. A Texas seller was told not to collect sales tax. If the trailer was actually sold in Oklaho…
How did Texas apply sales and use tax to vehicles bought for lease or brought into Texas under an out-of-state lease?
A vehicle purchase for leasing was not exempt; sales tax applied to the lessor's purchase. When an out-of-state-purchased vehicle was brought into Texas for highway use, the operator owed use tax base…
Does the National Enquirer qualify as a tax-exempt 'newspaper' so its sales are exempt from Nebraska sales and use tax?
Yes. The National Enquirer qualifies as an exempt newspaper for Nebraska sales and use tax. Under the Nebraska Revenue Act of 1967, as amended, a publication is an exempt newspaper if it is published …
Could a lessor claim a fair-market-value deduction for a vehicle transferred to the lessee under an open-end lease?
No. Transfer to the lessee under the open-end agreement made the transaction a conditional sale. The lessor was not treated as holding the vehicle for business or personal purposes, so the vehicle cou…
When did a titled mobile home cease being a vehicle and become real property under this 1979 Texas title guidance?
Only after permanent structural changes altered the house trailer so extensively that it could not reasonably be reconstructed for highway use. Removing wheels and axles was temporary and insufficient…
How did Texas distinguish vehicle tax from sales tax for attached accessories, rebuilt vehicles, and short-term rental accessories?
Accessories attached when a motor vehicle was purchased entered the motor vehicle tax base; accessories bought for later attachment followed limited sales tax. Initial titling of a vehicle assembled b…
How did Texas distinguish a self-propelled specialized unit from specialized equipment mounted on a truck?
A purpose-built self-propelled unit performing a specialized function without transporting separate property or passengers was movable specialized equipment subject to limited sales tax. But a vehicle…
When did a mobile home attached to Texas realty stop being treated as a motor vehicle for historical motor vehicle tax?
A mobile home ordinarily was a motor vehicle subject to the historical motor vehicle tax. The letter said it stopped being treated as one after permanent affixation to realty with rooms, a porch or de…
Was a truck rental to a Texas independent school district subject to the historical gross rental receipts tax?
No. The 1979 letter treated an independent school district as a public agency, so renting it a truck was exempt from the historical gross rental receipts tax. For calculating the lessor's minimum gros…
How did Texas require a title owner and dealerships to document, register, and report vehicles leased for re-rental?
The vehicle stayed titled to the lessor. With a valid retailer's permit, a rental certificate allowed tax-free registration while establishing the title owner's minimum-tax liability. The dealership d…
When could a Texas lessor use a retired lease vehicle's fair market value to reduce tax on a replacement vehicle?
A qualifying Texas business could reduce a replacement vehicle's historical taxable purchase price by a retired lease vehicle's fair market value if both vehicles met the stated Texas title, use, date…
Did Texas treat a mobile home as a taxable motor vehicle each time it was sold, regardless of its later use?
Yes. The 1979 letter treated a mobile home as a motor vehicle and imposed the historical motor vehicle sales tax on its first retail sale and every later resale. The purchaser paid when titling and re…
Did Texas tax an automobile extended-service policy, and who paid tax on parts used for covered repairs?
The extended-service policy itself was not part of the vehicle's purchase price and was not subject to the historical motor vehicle tax or Limited Sales or Use Tax. Parts used for covered repairs were…
How did Texas apply minimum motor vehicle rental tax to an initial fleet, replacement vehicles, and dealer rentals?
The title owner owed at least the historical minimum tax on its initial rental fleet without a fair-market-value deduction. Replacement vehicles could use the replaced vehicle's fair-market-value dedu…
Could the Texas Comptroller require a Social Security number on a historical motor vehicle rental-tax application?
The Comptroller said yes. It cited 42 U.S.C.A. § 405(c)(2)(C)(i), which allowed a state administering a tax law to use Social Security numbers to identify affected individuals and to require an affect…
Could a buyer receive a Texas motor vehicle sales-tax refund because the purchased car was wrecked soon afterward?
No. The historical tax applied to the vehicle sale regardless of what happened afterward, so wrecking the car soon after purchase did not create a refund. If the buyer traded the wrecked car for a new…
Were trailers built with chassis, axles, and wheels for highway towing treated as motor vehicles in Texas?
Yes. Based on the described undercarriage, the trailers were motor vehicles for tax purposes and subject to motor vehicle sales tax. The purchaser owed the tax at title and registration, while the sel…
Did Texas impose motor vehicle sales tax when a wholly owned subsidiary transferred vehicles to its parent in liquidation or merger?
No. The 1979 division interpretation imposed no motor vehicle sales tax when a wholly owned subsidiary transferred vehicles to its parent through a liquidating dividend on dissolution or a statutory m…
Were Royal Traffic Director Message panels motor vehicles subject to Texas motor vehicle sales or use tax?
No. Texas classified the manufacturer-built traffic message panels as movable specialized equipment because they performed a specialized function and were not designed to carry a divisible highway loa…
Did a dealership employee owe Texas motor vehicle tax on a purchase-price rebate, title fees, or the dealer's commission?
No. Under the described employee purchase plan, the rebate reduced what the buyer was actually charged and was not taxable consideration. Separately stated title and license fees also were excluded. T…
Was an organization properly formed under former Texas electric-cooperative law exempt from motor vehicle sales tax?
Yes. The Comptroller determined that an organization properly formed under former Texas Revised Civil Statutes article 1528b was exempt under section 30 from the motor vehicle sales tax imposed by for…
Who owed Texas motor vehicle tax on a 36-month lease, and was the lessee legally required to reimburse the lessor?
The lessor owed the historical motor vehicle sales tax when it bought the vehicle in Texas for a 36-month lease. The law imposed no tax on the lease payments and did not require the lessee to reimburs…
Was a model 520 prime mover with a rotary ax attachment a motor vehicle subject to Texas motor vehicle use tax?
No. Based on the submitted specification sheet, Texas determined that the model 520 prime mover with a rotary ax attachment was not a motor vehicle and therefore was not subject to historical motor ve…
Was a glider kit subject to Texas motor vehicle tax, and what happened when the rebuilt truck was later sold?
The kit itself was parts, not a motor vehicle, so historical motor vehicle tax did not apply; Limited Sales, Excise and Use Tax was paid to the seller. The same owner's retitling of the rebuilt truck …
Who paid Texas motor vehicle tax when a collector car was sold at auction, and did the auctioneer collect it?
The purchaser owed the historical motor vehicle sales tax on a collector car bought at a Texas auction, including a casual sale between individuals. Neither the auctioneer nor seller collected it. The…
Was a separately labeled collision-protection charge exempt insurance or a taxable collision-damage waiver on a car rental?
It was taxable. Separately stated insurance charges were outside the historical gross rental receipts tax, but a collision-damage waiver was not insurance. The customer paid a service charge to waive …
What proof did Texas require to refund vehicle use tax after Florida later imposed tax on the same vehicles?
Texas credited legally imposed sales or use tax actually paid to another state against its historical motor vehicle use tax. For vehicles bought and delivered in Florida, the refund request needed pro…
How did Texas tax a U-Haul trailer rental and separately stated insurance when the rental company charged five percent?
The historical tax was four percent of the trailer rental charge, collected and remitted by the rental agent. Separately stated insurance was not taxable. Because the company charged five percent on b…
Was a mobile-home buyer's Texas tax liability satisfied when the dealer collected money for tax but did not remit it?
No. The purchaser remained responsible for the historical motor vehicle sales tax until the State actually received it. The dealer's collection of money, accompanied by the false impression that the d…
How did Texas require rental companies to calculate minimum tax and report vehicles retired from rental service?
The rental certificate had to show the minimum tax for each vehicle and any trade-in or fair-market-value deduction at initial registration. When a titled rental vehicle left service, the owner listed…
Were heavy frac tanks rented for water storage motor vehicles subject to Texas sales, use, or rental tax?
No. The described frac tanks were not designed to transport property on highways and were not built from existing trailers, so Texas excluded them from historical motor vehicle sales, use, and rental …
Did Texas impose rental tax when a rental vehicle temporarily replaced a leased vehicle?
Only if the lessee paid an additional charge. The historical letter taxed that added rental charge but imposed no rental tax when the substitute vehicle was provided without an extra charge. Temporary…
Where did the cigarette tax stamp belong when clove cigarettes were individually sealed but also sold in a self-contained box of twenty?
The stamp followed the smallest self-contained unit sold. If cigarettes were sold separately, each sealed individual container needed a stamp. If twenty were sold together as one self-contained packag…
Was a related-company vehicle transfer taxable when the new corporation assumed the liens on the vehicles?
Yes. A transfer to a newly formed corporation could avoid historical motor vehicle tax when only stock was given, but not when the transferee also assumed vehicle debt. The assumed indebtedness was ta…
In a Nebraska motor-vehicle sublease chain, whose sales-tax election controls when the vehicle's owner has not elected to pay tax on the vehicle's cost but the intermediate lessor has?
The lessor's election governs. Under Revenue Ruling 01-78-15, when a vehicle owner rents or leases a motor vehicle to a lessor solely for re-lease to a lessee, and the owner has NOT elected to pay sal…
What did Texas's 1978 bulletin say about retitling a vehicle bought through another person's name?
Historically, later transfer to the true buyer generally triggered another sales, use, or gift tax when a vehicle was first titled in someone else's name. The bulletin allowed limited parent-to-former…
Did a Texas service member owe use tax on an out-of-state vehicle purchase, and could tax paid elsewhere be credited?
Yes. A Texas resident serving outside the state was subject to the same historical use tax as any other resident when returning and registering the vehicle. The tax used original purchase price less t…
Did Texas merchants collect ordinary sales tax on mopeds, tent trailers, boat trailers, and motorcycles?
No. The letter treated mopeds, tent trailers, boat trailers, and motorcycles as motor vehicles. The purchaser paid historical motor vehicle tax to the county collector at registration, and the seller …
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