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.
Can a wastepaper recycler qualify for Virginia's industrial processing exemption when it performs mechanical treatments beyond ordinary sorting and baling?
Possibly. Virginia reaffirmed that ordinary sorting and baling of wastepaper was not qualifying industrial processing. But if the recycler proved that it also shredded, fluffed, compacted, compressed,…
Can the Virginia Department hear a BPOL refund appeal before the taxpayer appeals to the city and receives a final local determination?
No. The city's denial of the taxpayer's 2011-2013 BPOL refund request was an appealable event, giving the taxpayer one year to file a local appeal. The Department could hear the dispute only after the…
When may a taxpayer ask the Virginia Department to review a city's denial of a BPOL refund request?
Only after the taxpayer files the statutory local appeal and the locality issues a final determination. The city's denial of the 2010-2013 refund request was an appealable event, starting a one-year p…
Could a taxpayer appeal a city's BPOL refund denial directly to the Virginia Department without first filing the statutory local BPOL appeal?
No. The city's denial of the 2010-2013 BPOL refund request was an appealable event under the BPOL statute. The taxpayer had one year from communication of that denial to appeal to the city. Only after…
When does an out-of-state seller that stores inventory in an Illinois marketplace warehouse have to register and collect Illinois sales or use tax?
It depends on nexus: if the out-of-state seller's inventory is held in Illinois at the time of sale (or is produced there), the seller is treated as an Illinois retailer that must register and collect…
Does an out-of-state company that sells downloaded software over the internet, with no Illinois office or employees, have to collect Illinois sales/use tax on those sales?
It depends on whether the seller has nexus with Illinois. Under the Quill two-prong test, a retailer must have physical presence in Illinois (such as an office, agent, representative, or repetitive de…
Was A Team Productions' protest timely when Department mail records showed a June 15 assessment mailing and the company hand-delivered its protest on September 14?
No. Detailed GenTax, sorting, postage, and USPS records proved that the Department printed, postmarked, and mailed the assessment on June 15, 2016. The 90-day deadline was September 13. A Team hand-de…
Can a municipality impose its own tax on gas distributors and on cigarette retailers, and who actually pays that tax?
Yes. Under 65 ILCS 5/8-11-2, a municipality of 500,000 or fewer people may tax businesses that distribute, supply, furnish, or sell gas for use within the city (not for resale) at up to 5% of gross re…
A governmental pension trust that is exempt from federal income tax owns a single-member LLC that operates in Tennessee. Is that LLC disregarded for Tennessee franchise and excise tax, and is the exempt trust taxed on the LLC's earnings?
Yes, the LLC is disregarded — but the exempt owner can still owe tax on unrelated-business income. A governmental pension trust (exempt from federal income tax under I.R.C. § 501(a)) is the sole membe…
Was Louie Casias personally liable for Casias Trucking's tax lien after forming an LLC but never closing the sole-proprietor CRS account or registering the LLC?
Yes. Casias formed an LLC in 2003, but never proved that he closed the sole-proprietor CRS account, registered the LLC for a new CRS number, transferred the business obligations, or obtained the Depar…
For Texas sales tax, is a cloud-based business texting platform a taxable data processing service, and is a separately billed printer rental fee taxed the same way?
Two different tax treatments for two separately billed charges — a cloud-based (SaaS) texting and messaging platform that stores, retrieves, and analyzes customer message data is a taxable data proces…
Could a short-term car-rental company sell its fleet to a related title-holding entity and lease it back without Retailers' Occupation Tax or Use Tax?
Yes under the rental-use exemptions, though not as an occasional sale. The rental company and title-holding entity had agreed before transfer that the vehicles would continue in short-term rentals sub…
Was a festival promoter's percentage of concession sales taxable as rent for licensed public recreational-facility space?
No. Although the payment was for a license to use real property, it qualified for the exemption for food-and-drink concessionaire space within a publicly owned recreational facility.
Could taxpayers overturn a Virginia assessment based on an IRS audit while their later federal amendment was still pending, and would a payment plan admit liability?
No immediate abatement was available. Virginia properly used the IRS's final 2010 audit adjustments after the taxpayers failed to file a Virginia amended return, and the IRS's write-off of its balance…
Are a Virginia resident's wages and salaries exempt from Virginia income tax, and can that theory defeat assessments or filing duties?
No. Virginia begins with federal adjusted gross income, so a resident's wages included federally are taxable unless a specific Virginia modification applies. The taxpayer's cited cases did not support…
Must a Virginia resident estate file a fiduciary income tax return when securities sold after death should receive a stepped-up basis but may still produce some taxable gain?
Yes. A resident estate must file if it is required to file federally or has any Virginia taxable income. The Department agreed that securities acquired from the decedent should use fair market value a…
Could married taxpayers use a lower federal adjusted gross income than the IRS reported and claim an unreduced Virginia age deduction for 2013?
No. Virginia used the federal adjusted gross income reported by the IRS because the couple's return showed a lower amount, and any discrepancy had to be resolved federally. Only the husband qualified …
Did an employer still owe Virginia withholding tax and a 100% fraud penalty when its employees had already filed returns and paid their own tax?
The withholding tax itself was removed because each employee had filed and paid the Virginia tax, and the evidence did not support a fraudulent intent to evade tax. But the employer remained liable fo…
Could a taxpayer obtain abatement of a 2013 Virginia income-tax assessment with incomplete and conflicting evidence that she had moved to another state?
Not yet. The taxpayer's rental, address-change, and information-return records did not establish when she moved or whether she intended to remain in the other state, and some evidence conflicted. Beca…
Did foreign work assignments and purchasing property in another state establish a new domicile when the taxpayer returned to Virginia within six months?
No. The taxpayer's overseas work was temporary, his Virginia driver's-license record contradicted his claim that it had lapsed, Virginia tax continued to be withheld, and the property he bought in Sta…
Did an out-of-state online seller have to register for Virginia sales tax when its only Virginia presence was resale inventory stored at a fulfillment center?
Yes. Effective June 1, 2017, owning tangible personal property for sale in Virginia was sufficient activity under Va. Code § 58.1-612 C 9. Because the online seller kept its resale inventory at a Virg…
Must a business hold a Virginia state contractor's license before a locality may classify it as a contractor for BPOL tax purposes?
No. Virginia said state contractor licensing and local BPOL classification use different definitions and serve different purposes. A business could be classified as a contractor for BPOL tax even with…
Did Public Law 86-272 protect Aventis and Sanofi-Synthelabo from New Mexico corporate income tax when related-company detailers, education, and clinical trials supported the market?
No. The companies' New Mexico activity exceeded protected solicitation: LLC detailers collaborated on treatment protocols and supplied education, while a related corporation sponsored clinical trials …
Is a company that procures props and costumes for productions a Georgia vendor or a conduit for the film tax credit, and which of its sales or rentals qualify?
It depends on inventory. To be a Georgia vendor for specific items, a company must carry those specific items in its own regular inventory. When the company instead procures an item it does not stock …
For Texas sales tax, is a restaurant's monthly charge for tabletop ordering devices a taxable equipment rental or a nontaxable service, and are patron fees for premium content on those devices taxable?
Both charges are taxable, for different reasons — the restaurant's monthly per-unit charge to its vendor for tabletop ordering devices is taxable as the rental of tangible personal property (the 'esse…
What resale exemption certificate did Virginia Tax Bulletin 17-4 require for purchases of stamped cigarettes beginning January 1, 2018?
Beginning January 1, 2018, a retailer purchasing Virginia-stamped cigarettes for resale had to use a Department-issued Form ST-10 C Cigarette Resale Exemption Certificate. The certificate was unique t…
If a Georgia taxpayer files his return late and buys film tax credits after the deadline to zero out his tax, does he avoid the late-filing and late-payment penalties?
No. Buying Georgia film (entertainment) tax credits after the return's due date does not avoid the penalties. The late-filing penalty under O.C.G.A. § 48-7-57 is computed on the tax that should have b…
Could Donald Krumrey recover a $21.76 estimated-tax underpayment penalty because he did not understand the New Mexico PIT instructions to require 2015 payments?
No. Krumrey's Social Security and pension income lacked New Mexico withholding, so he had to make estimated payments for 2015. The 2014 PIT packet contained instructions stating who must pay estimated…
Does a franchised car dealer owe Texas sales tax on a ground lease for the land where it operates its dealership and stores vehicle inventory?
No — a franchised motor vehicle dealer's ground lease of the real property where it operates its dealership (including storing inventory per TxDMV licensing requirements) is a nontaxable lease of real…
Does Colorado sales or use tax apply to charging third parties for non-transplantable human tissue?
Yes. Charging third parties for non-transplantable human tissue is a taxable sale of tangible personal property in Colorado, not a tax-free service. Human tissue is corporeal property; the labor to ac…
Could a security-services provider qualify as a staffing firm and exclude employee wages, payroll taxes, and benefits from BPOL gross receipts?
No. Although its client contracts were temporary, the security company retained substantial control over its guards, equipment, supervision, reporting, and performance. Virginia treated it as providin…
How should former New Jersey residents calculate Virginia's subtraction for pension distributions attributable to contributions previously taxed by New Jersey?
They could not subtract the entire unrecovered contribution balance at once. Because the pension lacked an individual year-end account value, Virginia used the federal simplified annuity method. The s…
Could Virginia assess 2012 tax more than three years after the return due date when taxpayers had not reported an IRS increase in federal income?
Yes. The ordinary three-year limit did not apply because the taxpayers failed to file a Virginia amended return within one year of the IRS change. Va. Code § 58.1-312 A 3 then allowed Virginia to asse…
Was an IRA distribution received before a taxpayer became a Virginia resident included in her Virginia part-year resident income?
No. After reviewing new documentation, Virginia found that one taxable IRA distribution was received in May 2013, before the taxpayer became a Virginia resident in June. That distribution was excluded…
Could a Virginia resident claim an out-of-state tax credit for income tax a partnership paid on his behalf through another state's unified return?
Yes. The partnership statement showed both the taxpayer's pro rata share of income attributable to the other state and his pro rata share of the tax paid there on his behalf. That satisfied Virginia's…
Could a taxpayer claim Virginia's Livable Home Tax Credit without a certificate of approval from the Department of Housing and Community Development?
No. A taxpayer first had to apply to the Department of Housing and Community Development and obtain a certificate proving that the accessible new home or retrofit qualified. Without that certificate, …
Could an auto-parts and paint retailer rely on customers' resale certificates for consumable shop supplies when the certificates appeared valid and resale was plausible?
Yes. Virginia found that the retailer could reasonably conclude from the certificates and its knowledge of the customers' businesses that the disputed supplies might be resold. Its acceptance of the r…
Does Colorado sales or use tax apply to leasing space on a telecommunications tower?
Yes. Leasing space on a telecommunications tower is subject to Colorado state (and state-administered local) sales and use tax. The Department treats the towers as tangible personal property — not rea…
Which dealers had to make Virginia's accelerated sales-tax payments in June 2017 and June 2018, and how were those payments calculated and reconciled?
For the June 2017 payment, dealers with at least $2.5 million of taxable sales or purchases in the prior fiscal year had to prepay 90% of their June 2016 sales-tax liability. For June 2018, the thresh…
What sales-tax registration rule did Virginia Tax Bulletin 17-3 announce for out-of-state dealers storing inventory at Virginia warehouses or fulfillment centers?
Beginning June 1, 2017, an out-of-state dealer making sales to Virginia customers had to register and collect Virginia retail sales and use tax if it owned inventory for sale stored in Virginia, inclu…
Did a county audit letter styled as a final determination permit an immediate Virginia Department appeal when the taxpayer had not first filed a local BPOL appeal?
No. The county audit staff's letter denied the refund and was labeled a final determination, but it responded only to amended returns and not to a local administrative appeal. The refund denial was an…
Does a taxpayer with multiple related rental-property LLCs need to file a formal petition for alternative apportionment in order to apportion each property's income separately?
No. The Illinois Department of Revenue explained that if separate rental properties truly qualify as separate trades or businesses under Department Regulation 100.3010(b), each business's income is ap…
Is electricity used to power computers that write and test software exempt from Colorado sales tax as manufacturing or industrial use?
It depends on whether the broader activity is genuine manufacturing or industrial use. Electricity for commercial use is taxable, but electricity for manufacturing or industrial use is exempt (treated…
Does a cash-basis landscaping company owe sales tax when it collects a refundable customer deposit, or only later when it invoices completed work?
No, not at the time the deposit is received — a seller using the cash basis of accounting does not have to report and remit sales tax on a refundable customer deposit when it's collected; tax is due o…
Must a school student club that collects donations to buy childrens books for a charity report the money on sales tax returns?
No. The student club is not buying or selling books; it only solicits monetary donations and forwards them to a 501(c)(3) charity, which then buys and distributes the books. Because no sale of tangibl…
Is sales tax on a ferry boat purchase limited to the first $230,000 of the price in New York?
Yes. Tax Law section 1115(jj) exempts the receipts over $230,000 from the sale of a vessel (including an outboard motor or trailer sold with it) for sales on or after June 1, 2015. So a ferry operator…
How would this taxpayer calculate income arising from its qualified project for Florida's Capital Investment Tax Credit?
The Department agreed that 100% of the taxpayer's apportioned income generated during the credit's life would count as income from the qualifying project, subject to the ruling's certification, invest…
Does gambling income won and taxed in another state increase an Illinois resident's credit for taxes paid to other states under IITA Section 601(b)(3)?
No. The Illinois Department of Revenue explained that because gambling income of a nonresident is not allocated to Illinois under IITA Section 301(c)(2), that same gambling income would not be taxable…
Could a Greyhound agent deduct ticket, freight, and vending commissions or defeat the assessments because the Department waited seven years to request a hearing?
No. Farrell's nonemployee commissions were gross receipts. He could not quantify a travel-agent deduction because he had discarded records and could not separate passenger-ticket commissions from frei…
When an affiliated group's members must use different apportionment formulas (trucking, airlines, financial institutions, general), how does the group compute its combined Colorado income tax?
The affiliated group may use the subgroup methodology from the Department's prior rulings PLR-11-002 and PLR-15-005: financial and non-financial members eliminate all intercompany transactions, each s…
Could a local school-board member claim Virginia's subtraction for federal or state employees earning no more than $15,000?
No. Virginia treated local school boards as political subdivisions and distinguished their members from state employees, so the husband's compensation did not qualify for the subtraction in Va. Code §…
Could Virginia Tax decide whether a non-cable telephone and internet provider properly charged a local government a right-of-way or cost-recovery fee?
No. The provider did not offer cable television, so its surcharge was not a right-of-way fee administered under the Communications Sales and Use Tax Act. If it was a telephone right-of-way fee, VDOT h…
Could a fencing contractor remove assessed use-tax purchases by showing cancelled checks and asserting that the checks were personal cash withdrawals?
No. Cancelled checks showing cash did not establish that the withdrawals were personal when the contractor's own general ledger recorded them in small-tools and materials expense accounts. Because Vir…
Are cost-reimbursement charges for donated, non-transplantable human tissue supplied for medical research and training subject to Georgia sales tax?
No. The Department determined that the described non-transplantable human tissue was not tangible personal property under Georgia's Sales and Use Tax Act. Reasonable cost-reimbursement charges for acq…
Were online legal-document membership subscriptions subject to Florida sales tax when no tangible property was transferred or licensed?
No. The membership subscriptions were not subject to Florida sales tax because the provider did not transfer possession of, lease, or license tangible personal property.
How are service agreements, shipping, restocking fees, and resale certificates taxed on sales of medical imaging equipment in Colorado?
It depends on separability. A separate, optional service agreement on medical imaging equipment isn't taxed (the servicer pays tax on parts it uses) — but if it charges the customer for parts, it must…
Did 100% natural latex mattresses qualify for Virginia's durable-medical-equipment sales-tax exemption?
No. Virginia again held that the natural latex mattresses did not meet the durable-medical-equipment exemption because they remained useful when illness or injury was absent. A federal flammability re…
Did an advertising firm owe use tax on printed campaign materials bought for a tax-exempt nonprofit client, and could Virginia project a sample year's errors across the audit period?
Yes. An advertising business is the user and consumer of tangible property purchased for its campaigns, including printing, so the nonprofit client's exemption did not shield the firm's purchases. Vir…
How did Virginia's 2017 guidelines calculate and administer the Major Research and Development Expenses Tax Credit?
For taxable years beginning on or after January 1, 2016, taxpayers with more than $5 million of Virginia qualified R&D expenses could claim 10% of current expenses above 50% of the prior-three-year av…
How did Virginia's 2017 guidelines calculate and administer the regular Research and Development Expenses Tax Credit for taxable years beginning in 2016 or later?
The generally refundable credit offered a primary base calculation of 15% of qualified Virginia research expenses above the base amount, capped at $45,000, or 20% and a $60,000 cap for qualifying univ…
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.