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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Are monthly charges for contractor-owned standby generators at Virginia grocery stores taxable equipment leases or exempt power services?
They were exempt service charges. The contractor owned, installed, monitored, maintained, fueled, and ultimately removed the generation systems; the grocery operator never possessed or could buy them …
Does a contractor's continuous work at a Virginia military facility create a definite place of business subjecting its service receipts to county BPOL tax?
Yes. Fourteen employees worked exclusively and continuously at the client's military facility for more than 30 consecutive days, creating a definite place of business under Va. Code § 58.1-3700.1 even…
When is a Virginia income-tax appeal timely and complete, and may a taxpayer appeal while the audit is still being completed?
A complete appeal must be filed within 90 days after the assessment is mailed. This taxpayer's appeal was postmarked more than 90 days after the June 6, 2019 assessments, and a letter saying only that…
If a manufacturer stores machinery and equipment in Georgia only temporarily before using it on projects outside Georgia, is that storage a taxable use in Georgia?
No. If the machinery and equipment qualify for Georgia's manufacturing exemption, storing it in Georgia is also exempt from sales and use tax -- even when the equipment is ultimately used on projects …
Which South Carolina COVID-19 tax deadlines were moved to July 15, 2020, and which other state taxes remained due June 1?
South Carolina moved covered income-tax, franchise-tax, and corporate-license-fee filings and payments originally due from April 1 through July 15, 2020 to July 15. The same date applied to estimated …
Can New Mexico residents both allocate Arkansas pass-through income outside New Mexico and claim a credit for Arkansas tax paid on that same income?
No. Dennis and Kerry Miller allocated their Arkansas LLC's billboard-rental income and real-estate capital gain to Arkansas on New Mexico Form PIT-B. That allocation reduced New Mexico tax by $5,314 b…
May a Virginia business appeal a city BPOL assessment directly to the Department before first obtaining the city's final determination?
No. An assessment created an appealable event, but the taxpayer still had to appeal to the city first. The city employee's same-day explanation of the assessments was not a final local determination, …
How did Virginia implement the July 1, 2020 cigarette-tax increase, including stamp limits, the floor tax, and transition deadlines?
Virginia's cigarette tax doubled on July 1, 2020 from 1.5 to 3 cents per cigarette -- from 30 to 60 cents for a pack of 20. These guidelines limited old-stamp purchases during April-June 2020, barred …
How could taxpayers check the status of South Carolina advisory opinions through March 31, 2020?
SC Information Letter #20-7 attaches the Department's citator for advisory opinions issued from 1987 through March 31, 2020. It identifies opinions the Department knew to be modified, modifying anothe…
Where can taxpayers find South Carolina Department of Revenue advisory opinions by tax topic through March 31, 2020?
Use the subject index attached to SC Information Letter #20-6. It organizes South Carolina Department of Revenue advisory opinions issued from 1987 through March 31, 2020 under administrative, alcohol…
Can a Virginia cigarette wholesaler defeat a sales-tax assessment with resale certificates and invoices obtained only after the audit began?
No. The wholesaler obtained two resale certificates only after the audit started, so they were not treated as accepted in good faith and required independent validation. Both customers' registrations …
Could two restaurants overturn estimated Virginia sales-tax assessments based on income returns and comparable businesses when they lacked verifiable sales records, and did first-audit penalties apply?
The estimated tax stood, but the compliance penalty was waived. Because the restaurants lacked adequate records and their reported figures were inconsistent or unverifiable, the auditor reasonably use…
When may a Virginia equipment distributor rely on cable-television and resale exemption certificates, and which purchases remain taxable?
Mixed. The distributor properly accepted a cable customer's Form ST-20 in good faith for equipment used to broadcast, amplify, transmit, or distribute cable signals, and properly accepted a facially v…
Must an out-of-state trucking company with Virginia routes file a Virginia corporate income tax return?
Yes. An out-of-state trucking company whose trucks pick up and deliver in Virginia has a positive Virginia apportionment factor (vehicle miles in Virginia), and Virginia treats that as creating income…
What happens when a Virginia taxpayer first supplies documents supporting a sales-tax refund claim during the administrative appeal?
The Department closed the appeal and referred the new documents to field audit staff to review the refund claim and revise it as appropriate. If issues remained after the refund audit revision, the ta…
How long does a Virginia taxpayer have to request reconsideration of a final Tax Commissioner determination?
Forty-five days under 23 VAC 10-20-165 F. The taxpayer asked on September 18, 2019 to reconsider P.D. 19-49, issued May 8, 2019, well after the deadline. Further review was barred, P.D. 19-49 remained…
What happens when a Virginia sales-tax taxpayer first provides supporting audit documentation during its administrative appeal?
The Department closed the appeal and sent the newly supplied documentation to field audit staff for review and any appropriate audit adjustments. If issues remained after the auditor revised the audit…
Can partners in a partnership divide up Illinois's River Edge Historic Preservation Credit however they agree, instead of strictly according to their partnership ownership percentages?
Yes, within limits. The Department ruled that under 35 ILCS 5/221(d), partners may allocate the River Edge Historic Preservation Credit pursuant to an executed agreement documenting an alternative dis…
If a partnership or LLC receives Illinois Historic Preservation Tax Credits, can the partners divide up those credits by agreement instead of strictly by their partnership interests?
Yes. The Illinois Department of Revenue ruled that under the Historic Preservation Tax Credit Act, a partnership (here, an investment fund structured as an LLC taxed as a partnership) may allocate its…
Did Kansas waive penalty and interest on first-quarter 2020 estimated tax payments?
Kansas Notice 20-02, prompted by the COVID-19 pandemic, explains that the Director of Taxation will waive any applicable penalty and interest for first-quarter 2020 estimated tax payments that were du…
Was a mobile concrete batch plant's per-yard mixing fee taxable for the requesting road contractor?
No. On the stated facts, the true object was a concrete-mixing service, so the mobile batch plant operator's per-cubic-yard fee was not subject to South Carolina sales tax. The road contractor bought,…
Who owed South Carolina sales tax on the requesting company's peer-to-peer vehicle rentals?
The requesting platform was the retailer responsible for remitting South Carolina sales tax on all of its peer-to-peer motor vehicle rentals of 30 days or less in the state. It qualified as a marketpl…
What Louisiana income-tax deadline and penalty relief did RR 20-002 provide during the 2020 COVID-19 emergency?
The ruling created temporary 2020 relief: a first- and second-quarter estimated-tax penalty safe harbor, timely treatment for specified late 2019 pass-through elections, and a 30-day extension for cer…
What does Nebraska accept as a valid signature on tax forms, and which forms still require a handwritten signature?
For most forms, any mark counts -- but three documents still need a handwritten signature. Revenue Ruling 99-20-1 says that, unless fraud is indicated, the Nebraska Department of Revenue (DOR) will ac…
How did SC IL #20-4 change South Carolina's COVID-19 tax deadlines, and did income tax and other taxes get the same date?
SC Information Letter #20-4 (March 23, 2020) restated and updated the COVID-19 relief in #20-3 by splitting the deadlines. Income tax: conforming to the IRS (Notice 2020-18), South Carolina moved 2019…
Did Kansas extend the 2019 tax filing and payment deadlines during COVID-19?
Kansas Notice 20-01, prompted by the COVID-19 pandemic, explains that the Director of Taxation extended several 2019 filing and payment deadlines. Homestead or property tax relief refund claims (norma…
Did South Carolina allow curbside sales of beer and wine during COVID-19, and under what conditions (per SC IL #20-5)?
Yes, temporarily. SC Information Letter #20-5 explains that Governor McMaster's Executive Order No. 2020-12 (effective March 21, 2020) temporarily suspended SC Regulation 7-702.5 — which otherwise bar…
Were multipacks of individually wrapped ice cream and frozen novelty items exempt when their combined weight exceeded 16 ounces?
No exemption. Florida treated each package as multiple units of individually wrapped ice cream or frozen novelties, which remain taxable whether sold separately or in multiple units. A combined packag…
Could a Florida consolidated group discontinue filing after substantial changes in business focus, growth, acquisitions, and international reach?
Yes. Florida found reasonable cause because the group's business focus had shifted and its size, acquisitions, research investment, international activity, and geographic footprint had changed substan…
Were free lodging and meals at a company-owned training facility subject to Florida sales, surtax, or tourist taxes?
Generally no, when the company bore the entire cost and charged nothing. Free accommodations for its partners, employees, and designated clients were not subject to sales, discretionary surtax, or tou…
Was a staffed autonomous-shuttle agreement a nontaxable transportation service or a taxable vehicle rental?
A nontaxable service to the customer. The provider retained ownership and control, supplied an attendant on every autonomous shuttle, and used those attendants to operate the vehicles if needed. The c…
Did a couple who moved abroad for work change their Virginia domicile, and did rent from their retained Virginia home remain taxable?
Yes, they changed domicile before 2015. Their initially temporary 2012 assignment became indefinite in 2014; they leased a foreign residence, obtained local driver's licenses, registered a vehicle, di…
How does Virginia treat a taxpayer who is a California actual resident but retains Virginia domicile, and where is the California tax credit claimed?
The taxpayer remained a Virginia domiciliary resident because her California employment began as temporary and she retained Virginia property, voter registration, vehicle registration, and a driver's …
Can a Virginia taxpayer challenge old nonfiler assessments and recent self-reported tax bills with a general statement that the amount owed is disputed?
No. An appeal postmarked September 12, 2019 was too late for assessments issued from 2009 through 2015, because Va. Code § 58.1-1821 allows 90 days. The Department had jurisdiction only over 2017-2018…
May Virginia individual owners claim fixed-date-conformity bonus-depreciation subtractions shown on their pass-through entities' VK-1 forms when no prior addition appears on their personal returns?
Yes on these facts. The couple accurately reported 2015-2016 FDC subtractions shown on asset reports and VK-1 forms from two pass-through entities for assets placed in service earlier with federal bon…
Could Virginia tax an individual as a domiciliary resident for 2016 after a prior ruling had already concluded she did not re-establish Virginia domicile until 2017?
No. P.D. 19-83 had already concluded in the taxpayer's 2015 case that she could not have re-established Virginia domicile until she returned to the United States and began residing in Virginia in 2017…
Did working in another state and spending fewer than 183 days in Virginia change a consultant's Virginia domicile when he stayed in a hotel and kept Virginia ties?
No. The husband may not have been an actual resident under the 183-day test, but he remained a Virginia domiciliary resident. His hotel in the work state was not a permanent or indefinite residence, a…
What COVID-19 filing and payment relief did South Carolina announce in SC IL #20-3, and until when?
Until June 1, 2020. SC Information Letter #20-3 (March 17, 2020) announced special COVID-19 filing and payment relief: returns and payments for taxes administered by the Department that are due betwee…
What records must Virginia taxpayers provide to substantiate charitable gifts, unreimbursed employee expenses, and Schedule C business deductions?
They must provide records sufficient to verify each deduction under the federal rules Virginia follows. This couple failed to substantiate charitable gifts, unreimbursed employee expenses, and expense…
How can a Texas hotel pass tourism public improvement district (TPID) assessment costs on to guests as a separately stated fee without triggering trust-tax liability under Section 111.016 — and is that fee subject to hotel occupancy tax?
A hotel can pass tourism public improvement district (TPID) assessment costs on to guests as a 'tourism public improvement district recovery fee' without triggering trust-tax liability under Section 1…
Could Virginia rely on federal W-2 data to add omitted wages to nonresident, part-year, and resident returns when the taxpayer offered no contrary evidence?
Yes. Wages are generally income under IRC § 61 and flow into Virginia taxable income. For 2015, Virginia could rely on the W-2 showing Virginia wages absent proof they were not Virginia-source compens…
Did Virginia's deduction for 'long-term health care insurance' also cover premiums for ordinary health insurance?
No. The phrase covered long-term care insurance for extended nursing-home or in-home care, not general medical insurance. Legislative history used 'long-term care insurance' and 'long-term health care…
Did a couple change domicile from Virginia during a two-year move when they initially stayed with a relative and retained Virginia property, licenses, and vehicles?
Yes. Although the move took two years and the couple retained Virginia ties during the transition, the evidence showed a continuing process of establishing domicile in the new state: living there, att…
When did South Carolina's casual excise tax apply to private sales of boats, boat motors, and airplanes under RR 20-1?
Under the law covered by RR 20-1, the purchaser in a private or other nonretailer sale paid casual excise tax when South Carolina issued title or proof of ownership and sales or use tax had not alread…
Was a mandatory student fee for parking access and campus shuttle service taxable, and could part be allocated to transportation?
Partly. Paying the mandatory fee gave each student a parking permit, creating a taxable license to use real property. Because the same fee also funded shuttle transportation, Florida accepted a reason…
Did maps, clothing lists, and phone-payment logs substantiate unreimbursed employee expenses for mileage, work clothes, laundry, phone, and internet?
No. The maps lacked exact addresses and conflicted with the employment record; the clothing list had no receipts and the contract imposed no uniform requirement; and the phone and internet logs did no…
How should Virginia taxpayers report claim-of-right income received in one year and repaid in a later year?
They should follow their federal IRC § 1341 treatment on the Virginia return for the repayment year, not revise the year the income was received. If a repayment over $3,000 qualifies, they may use the…
Was a 2019 amended Virginia return claiming a 2014 refund timely when another state had just assessed the taxpayer for 2014?
Yes. The ordinary three-year refund period had expired in May 2018, but Va. Code § 58.1-1823 A (v) gave the taxpayer one year after another state's final determination to amend the Virginia return. Sh…
Did a military couple establish Virginia domicile before the wife's active-duty assignment despite claiming another state as home of record?
Yes. They voluntarily moved to Virginia in May 2015, obtained a Virginia license and vehicle registrations, leased and later bought a home, and had no definite departure plan. The wife's active-duty a…
Did a demolition contractor's construction-material recycling equipment qualify for Virginia's industrial manufacturing and processing exemption?
No. The contractor's primary activity fit NAICS 238910, Site Preparation Contractors, in Sector 23 rather than manufacturing Sectors 31-33, so its recycling equipment and parts did not qualify. Virgin…
Could a home-health agency deduct federal EEOICPA payments because its patients were Medicare beneficiaries, or exclude services involving Navajo Nation members?
No. Four Corners Healthcare received its payments from the U.S. Department of Labor under the Energy Employees Occupational Illness Compensation Program Act, not under Medicare Title 18. Section 7-9-7…
Could a Capital Investment Tax Credit project measure its income as the increase over the taxpayer's pre-project base-year income?
Yes. Florida approved comparing current Florida adjusted federal income with a representative pre-project base year, treating the increase as project income, applying a project apportionment factor, t…
Does an Illinois trucking company have to withhold Illinois income tax on wages paid to an out-of-state driver who is dispatched from Illinois but drives interstate routes that originate and end near his home in another state?
It depends, and the Department did not give a final yes-or-no answer for this driver. The Department explained that Illinois withholding is not required if the driver's work qualifies for a federal ex…
Could owners claim Virginia fixed-date-conformity bonus-depreciation subtractions reported on their pass-through entity forms when Virginia had no record of an earlier addition?
Yes. The couple accurately reported the 2015 and 2016 subtractions shown on the entity's Virginia asset reports and VK-1 forms, so they were entitled to claim them and the assessments were abated. If …
Is a discharged servicemember's severance pay taxable by Virginia when he received it after separation while still living in Virginia?
Yes. A servicemember was discharged in January 2015 and received his final military pay plus a severance payment in February 2015. He left those amounts out of his federal adjusted gross income, but t…
What proof did Virginia require for 2017 personal-property-tax and cash or noncash charitable deductions?
Property-tax bills alone were insufficient; the couple needed receipts, canceled checks, or other proof of payment and received 30 days to provide it. Cash gifts would be adjusted to the supplied rece…
Could an acquired Florida consolidated group deconsolidate after the former common parent became a subsidiary of an unrelated separate-filing parent?
Yes. The unrelated acquisition ended the taxpayer's old consolidated group because it was no longer the common parent. Its members joined a new parent's affiliated group whose Florida election was sep…
How did Florida source software-subscription licensing fees and implementation-service revenue for the corporate sales factor?
Software licensing fees were Florida sales to the extent the software was used in Florida. Implementation-service receipts were Florida sales when the client was located in Florida. If the taxpayer co…
When an Illinois retailer sells food and beverages, does it collect both Use Tax and Retailers' Occupation Tax from the customer, and can it reduce what it remits to the State?
Yes. Illinois retailers collect a single combined tax (6.25% state, plus any local Retailers' Occupation Tax) from patrons at the time of sale, and when remitting to the State they reduce the Use Tax …
If a software company can't satisfy Illinois' five-part test for an exempt software license, can it avoid charging sales tax by getting a resale certificate from the distributor instead?
Yes, but the underlying software transaction was taxable. The Department ruled that a software license accepted by the end user clicking 'I agree' -- rather than by a wet-ink or verifiable electronic …
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