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 a social clubs fees charged to non-members for lessons, camps, sing-alongs, and facility rentals taxable?
Mostly no. A clubs member dues are taxable, but fees charged to non-members are not taxable just because of the clubs status — each activity is judged on its own nature. Tennis lessons are non-taxable…
Were a vehicle-retail integration provider's separately stated electronic credit-reporting charges subject to Florida sales tax?
No. The separately stated monthly charges were nontaxable credit-reporting services, and their electronic delivery did not constitute a sale of tangible personal property or a taxable information serv…
Were separately stated monthly charges for electronically delivered credit-reporting services subject to Florida sales tax?
No. The separately stated monthly credit-reporting charges were nontaxable both as separately stated credit-reporting services and as electronically furnished information that was not tangible persona…
Was the full price of a laser-tag party package taxable when it included pizza, beverages, and party services?
Yes. Because each package included food and beverages, the entire charge—including laser tag, the room, invitations, paper goods, and cleanup—was taxable. Standalone admission remained exempt, and tax…
When does an out-of-state seller have enough connection ('nexus') with Illinois to owe Retailers' Occupation Tax or to have to collect Use Tax from Illinois customers, and how does Illinois treat related issues like software, cloud computing, drop shipments, and short-term rental platforms?
Illinois could not give a simple yes/no answer to a multistate nexus survey because nexus determinations are too fact-specific for a General Information Letter. Instead, the Department outlined its ge…
Does providing cloud-based software (like software as a service, an API, or a remote access agent) trigger Illinois Retailers' Occupation, Use, or Service Occupation Tax, and can an Illinois-based automated call-center service create sales tax nexus for its out-of-state clients?
A provider of software as a service acts as a serviceman: if nothing tangible is transferred to the customer, the service generally is not subject to Retailers' Occupation, Use, Service Occupation, or…
Did a custom oral device that advances the jaw to keep a sleep-apnea patient's airway open qualify as an Illinois medical appliance?
Yes. Based on the described operation, IDOR ruled that the physician-prescribed, dentist-custom-fitted device directly substituted for or corrected a malfunctioning body function by moving the jaw for…
Could Chesterfield County tax Verizon cable set-top boxes, and could it raise an appeal-timeliness objection for the first time in circuit court?
No on both issues. The Supreme Court of Virginia held that Verizon's cable set-top boxes were intangible personal property not subject to local tax. Chesterfield County also waived its 2008-2009 timel…
Is an online service that turns users photos and clips into videos taxable as prewritten software in New York?
Yes. The company sells online access to a web interface that lets customers turn their photos and clips into videos: customers choose content, order, music, logos, text, and style, and proprietary vid…
Can a taxpayer increase his New York basis in out-of-state municipal bonds by the premium paid, when New York taxes the interest but allowed no deduction for the amortized premium?
No. New York determines bond basis under federal law. Because the taxpayer must amortize the premium on tax-exempt bonds and reduce basis each year (IRC § 171; § 1016(a)(5)), and no New York Tax Law p…
Is a lump-sum distribution from a federal employee's Thrift Savings Plan (TSP) exempt from New York income tax?
Yes. The lump-sum TSP distribution attributable to contributions made by the federal employee and his federal employer is exempt from New York income tax under the federal-employee pension subtraction…
Does a German employer pension qualify for Illinois's income tax subtraction for retirement income?
No. The Illinois Department of Revenue concluded that a pension paid by a private German employer under Germany's Betriebsrentengesetz does not qualify for the Illinois retirement-income subtraction, …
Can a partnership use IITA Section 304(f) alternative apportionment (specific accounting) to change how business income is allocated among its nonresident partners under Section 305(a)?
No. The Illinois Department of Revenue concluded that Section 304(f) only lets a taxpayer petition for an alternative method of allocating and apportioning its own business income to Illinois when the…
Does New York sales tax apply to a free app that lets users pay to use restrooms at participating venues?
No, on both counts. The app is prewritten software, which is taxable tangible personal property when sold — but a sale requires a transfer for consideration, and here the app is given to users free of…
Could a taxpayer take a BPOL dispute to the Virginia Department before filing a complete local appeal?
No. The county's audit letter was not a final appeal determination, and the taxpayer had not filed a complete local appeal. The Department lacked jurisdiction until that process was completed, but the…
Is subscription access to an online secure board-document file-sharing portal taxable as software in New York?
Yes. The petitioner sells subscription access to online applications that let corporate boards store, annotate, approve, collaborate on, and share secure documents. Giving customers access to this pre…
Could Hydrotech avoid IFTA tax and IRP penalties after a departing employee and office move left fleet fuel and mileage records unavailable during audit?
Only the IFTA penalty was waived. Hydrotech did not timely produce the trip, mileage, jurisdiction, fuel-purchase, and vehicle records required by IFTA and IRP, and later documents were too incomplete…
Was a business that bought, rehabilitated, and resold real estate a contractor for Virginia BPOL tax even when independent contractors did the work?
Yes. A business constructing or improving property for its own account for sale can be taxed at the contractor rate even when it hires others to perform the work. Virginia upheld that classification b…
Was a facility that sold steam but earned most of its revenue from electricity primarily engaged in producing electricity for resale under Georgia's energy exemption?
Yes. Considering the integrated operation as a whole, the Department found the facility primarily engaged in producing electricity for resale. Key facts included that electricity generated more than h…
Can a printer qualify as a Georgia manufacturer, and can its purchase or lease of a copier receive the manufacturing machinery exemption?
A printer may be a qualifying manufacturer if it manufactures tangible personal property for sale or further manufacturing at a manufacturing plant. A copier may then qualify if it is machinery or equ…
Are separately stated electronics extended warranties, repair service fees, and enrollment in a device-upgrade program subject to Georgia sales tax?
A separately stated optional extended warranty is a nontaxable service. But when a covered repair is performed for one non-itemized fee covering parts and labor, that repair fee is taxable. Free enrol…
Are internet-delivered course licenses, online hosting, software customization, and translation services subject to Georgia sales tax?
No, on the described electronic-only transactions. Online course licenses and hosting were not taxable when customers received no software in a tangible medium and no right to receive it that way. Sof…
Could Wells Fargo claim New Mexico renewable energy production credits for 2011 when facilities produced energy that year but eligibility certificates issued in 2012?
No. Preliminary approval of a facility's application package reserved priority but did not authorize the tax credit. Section 7-2A-19 required the taxpayer to submit the Energy Division's certificate o…
Can an LLC buy an aircraft tax-free as a sale for resale and lease it back to its own parent company, and does later using the aircraft itself trigger sales tax?
Yes, with a one-year condition — a company that buys an aircraft to lease it to another party (even a related party, like its own parent) qualifies for the sale-for-resale exemption from sales/use tax…
May a Georgia motor-vehicle rental dealer buy oil for routine oil changes tax-free as a resale item?
No. Although a rental dealer may buy vehicles and repair parts that become part of rental vehicles tax-free for resale, motor oil used in routine oil changes is a consumable used in the dealer's opera…
When is electricity for vacant apartments, residential outbuildings, apartment amenities, and HOA common areas exempt from South Carolina sales tax?
Electricity remains exempt for a vacant apartment intended for residential rental and for separately metered structures connected with a home when used residentially. But electricity sold to an HOA fo…
How do Georgia sales tax and title ad valorem tax apply to leased commercial trucks, non-motorized trailers, IRP vehicles, repair parts, and lease fees?
A lessor may buy trucks, trailers, and repair parts for its lease inventory tax-free for resale, but lease payments are generally subject to sales tax unless TAVT or another exemption applies. Georgia…
Did disability suspend Virginia's three-year deadline for claiming a 2012 income-tax refund?
No. The 2012 return had to be filed by May 2, 2016 to obtain a refund, but it was not filed until October 2016. Virginia law required a fiduciary or authorized agent to file for a disabled taxpayer an…
When a lessor replaces or adds equipment on a long-term lease with under three years left, is it still a long-term lease or a new short-term lease?
It depends on whether you replace or add. Replacing existing equipment on a long-term lease (over three years) keeps it a long-term lease — you keep collecting tax on each lease payment — even if the …
Did Ronald Jaynes preserve his gross receipts tax protest by calling officials and trying to resolve the audit before submitting anything in writing after the deadline?
No. The Department mailed the $12,383.81 assessment on April 11, 2016, making July 11 the written-protest deadline. Jaynes contacted Department personnel, the State Auditor, and the Governor's office,…
Does selling recovered salts and minerals as a byproduct disqualify a water desalination company's equipment purchases from the Texas desalination sales tax exemption?
No — a company's equipment, services, and supplies used in desalinating water remain exempt from Texas sales and use tax under the desalination exemption even if the company sells the recovered salts …
Could an affiliated group stop filing Florida consolidated returns after ending its former business and changing its business focus?
Yes. Ending the healthcare business and shifting the group's business focus supplied good cause to deconsolidate. Because the request missed the rule's advance deadline, however, separate filing began…
Which Florida machinery exemptions applied to energy-from-waste facilities, repairs, and their production process?
The operators did not qualify for the cited NAICS- or SIC-limited manufacturing exemptions. But qualifying machinery used to produce electricity or steam, including its repairs, maintenance, and repla…
When a motor vehicle is sold to a leasing company for a long-term lease (over one year), who owes Retailers' Occupation Tax or Use Tax, and does that include any tax amount the lessor passes through to the lessee?
The dealer that sells the vehicle to the leasing company owes Retailers' Occupation Tax, and the leasing company (as purchaser/user) owes Use Tax; the lessee owes neither tax directly. For leases long…
Could a de minimis pan-refurbishing serviceman buy glaze tax-free when it became part of customers' exempt commercial baking equipment?
Yes for properly documented industrial-baker customers. The glaze was cured into and became part of exempt baking pans used in manufacturing, so the serviceman could buy it tax-free from Illinois supp…
Was a separately purchased consumer-electronics extended warranty taxable when customers also had to buy it to use a device-upgrade program?
No. IDOR treated the separately priced extended warranty as an optional maintenance agreement, so its sale was not subject to Retailers' Occupation Tax even when purchase was required for upgrade-prog…
A Tennessee company licenses speech-recognition software to run a transcription service and charges its clients a fee per report. Are the fees it charges clients taxable, and is the software the company itself buys taxable or exempt as a purchase for resale?
Two different answers. (1) The report fees the company charges its CLIENTS are NOT subject to Tennessee sales tax — the true object is a nontaxable transcription and storage service, and the small 'cl…
Is a dealer's vehicle depreciation-protection membership taxable, and is its payment toward a replacement vehicle included in taxable consideration?
The membership fee was not a taxable insurance service or part of the original vehicle's taxable price. But when the program paid a benefit toward a replacement vehicle after theft or total loss, that…
Are 'dial before you dig' underground-utility notification centers providing a taxable information service to the utility operators who fund them?
No — a statewide 'dial before you dig' notification center that alerts underground utility operators when excavators plan to dig near their lines is NOT providing a taxable information service, even t…
Is a dealership membership program that pays a car buyer's depreciation loss (beyond their insurance settlement) after a total loss or theft taxed as insurance, and does the benefit affect motor vehicle sales tax on the replacement car?
Three separate answers for three separate charges — the membership fee a car buyer pays to join a dealership's vehicle depreciation-protection program is NOT a taxable insurance service (because the p…
Were freight charges a broker collected from shippers and passed to motor carriers part of its Virginia BPOL gross receipts?
Not if the broker could prove the carrier payments were separately accounted agency funds. Contracts showed it collected and disbursed the money for shippers and carriers, and its federal reporting ma…
Were meals sold directly to county-jail inmates by a charitable educational organization exempt from Illinois sales tax?
No. IDOR said the sale would be exempt if the prison itself sold meals to its inmates, but the requesting charitable or educational organization -- not the prison -- planned to be the seller. Its dire…
Does a public golf course owned by a nonprofit's single-member LLC have to charge Connecticut admissions tax on daily and seasonal greens fees?
It depends on the fee. Daily greens fees at the public course are exempt from Connecticut admissions tax as daily charges to participate in a sporting activity. But seasonal greens fees are taxable, b…
What federal tax changes did Virginia adopt for 2016 returns when it advanced its Internal Revenue Code conformity date?
Virginia advanced its fixed conformity date from December 31, 2015 to December 31, 2016 for tax years beginning in 2016. It adopted the 2016 Olympian and Paralympian medal-and-prize exclusion but reta…
Could Broken Hill claim Rural Jobs Tax Credit for workers kept on its payroll roster but paid for fewer than 48 weeks because of unpaid leave or third-party benefits?
No. Broken Hill showed that workers remained on its personnel roster, accrued seniority and benefits, and could not work elsewhere, but it did not provide detailed payroll proof establishing the 48-we…
Is the sale of a fractional share in an aircraft taxable, and is a later sale of the retired plane exempt?
No to the share, and the retired plane is exempt. Selling a fractional share is not a sale of tangible personal property because the share owner never gets dominion and control of the aircraft: the op…
How does Illinois tax a turnkey door-hanger marketing service that designs, prints, verifies, and distributes printed pieces?
IDOR did not give a transaction-specific yes-or-no answer; this nonbinding GIL supplied the serviceman framework. Tangible door hangers transferred with a service are taxed under one of four methods: …
Did gain from Fortune 500 insurance-company stock qualify for Virginia's small technology-business capital-gain subtraction?
No. The stock was purchased in 2004 and issued by a large insurance company, not a qualifying small Virginia technology business within the statutory investment period. Oral advice later written down …
Did a husband's move to another state make the couple eligible to file a joint Virginia nonresident return for 2012?
No. The husband worked and lived in another state, but kept his Virginia home, license, vehicle registrations, and voter registration and returned in 2013. Virginia found no domicile change, treated h…
Did delivered meal kits containing chilled, raw ingredients qualify for Virginia's reduced sales-tax rate on food for home consumption?
Yes. The chilled raw ingredients were packaged for customers to cook at home, so the full meal-kit sales price qualified for the reduced food rate then in effect. Separately stated delivery was exempt…
What percentage of rent under this mixed-use port-authority lease was subject to Florida sales tax?
The Department found 24.49% of the rent taxable. Property used exclusively to load or unload vessel cargo qualified for the port exemption, while the remaining leased areas were taxable.
How did Florida tax new security-system installations, upgrades, and later maintenance or repair under one proposed contract?
New installations, upgrades, and expansions were real-property improvements, so the customer was not charged security-service tax and the contractor paid tax on materials. Ongoing maintenance and repa…
I run my business from just across the state line and ship products to New Mexico customers — do I owe New Mexico gross receipts tax, and can I avoid it if I couldn't get resale certificates?
Yes, he owed the tax, and the protest was denied. Randall Gilbert sold custom cabinetry from his business in Farwell, Texas (right across the line from New Mexico) to New Mexico building contractors a…
Is a lender's insurance-tracking vendor providing a taxable data processing or insurance service when it monitors whether borrowers maintain required hazard/flood insurance?
No — a company that monitors whether a lender's borrowers maintain required hazard and flood insurance coverage, using its professional insurance-industry knowledge plus an automated system to process…
Could Nebraska real estate salespersons, associate brokers, or designated brokers qualify for microenterprise tax credits?
Salespersons and associate brokers did not qualify because they were treated as employees under a designated broker and did not manage or operate the business. A designated broker could qualify if per…
Were charges for online consumer-survey analytics and electronically delivered reports subject to Florida sales tax?
No, provided the charges were not part of a sale of tangible personal property. The baseline surveys and additional analytics furnished information and reports electronically.
What are South Carolina's new withholding filing and remittance due dates (per SC IL #17-3)?
SC Information Letter #17-3 reminds employers and withholding agents of new South Carolina withholding due dates. Forms W-2 and 1099 must now be filed with the Department on or before January 31 follo…
Does a company that custom-builds and permanently installs closets and cabinets make a retail sale or act as a Georgia real-property contractor?
The company acts as a real-property contractor, not a retailer, when it custom-designs, cuts, and permanently screws storage systems into a customer's studs so removal would significantly damage the u…
Are wood pellets sold for home heating exempt from Colorado sales tax?
Yes. Wood pellets bought for residential use are exempt from Colorado state sales tax. Wood pellets are wood, and wood sold for residential heating (stoves, space heaters, and other domestic fuel uses…
Is a $1-buyout computer lease to a student taxable, and does the schools exemption apply?
Taxable. A computer 'lease' to a student that lets the student buy the equipment for $1 at the end is really a credit sale (a financed purchase), which is taxable — and even if it were a true lease it…
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