Saturday, October 02, 2010

Sales and Use Tax News

Here are a few items I’ve picked up from RIA’s State & Local Taxes Weekly Newsletter. You should subscribe too. And please keep in mind I’ve REALLY summarized these items, so check out the details before taking action or making a commitment.


There are lots of stories about the state winning because the taxpayer didn’t cross the i’s and dot the t’s. But they lost in this case because the state apparently didn’t fill out the assessment paperwork correctly. So it makes sense to be sure the paperwork they give you is correct. Taurus Investment Group, LLC v. Ala. Dept. of Rev., Admin. L. Div., Dkt. No. S. 10-339, 07/06/2010


For taxpayers affected by the San Bruno explosion and fire, they can get an extension on their taxes. Of course, there are forms to fill out. California SBE News Release 98-10-Y, 09/10/2010 ; Employment Development News Release #105, 09/10/2010

The cap on sales and use tax for a boat is $18,000 for purchases or use after 7/1/10. Florida Tax Information Publication 10(A)01-07, 06/22/2010

A tennis instructor pays the city a fee to be able to offer lessons on the city-owned courts. That’s a license to use real estate. It’s taxable in Florida. The city should have charged sales tax on the fee. Florida Technical Assistance Advisement 10A-033, 07/02/2010

As of 1/2/11, government agencies (except Fed) will be issuing Certificates of Entitlement to contractors to allow them to buy materials for public works projects tax free. Florida Tax Information Publication 10(A)01-18, 08/16/2010


You’ll be able to pay your use taxes on your personal income tax return, and there’s a use tax amnesty program in effect after 12/31/10. 35 ILCS 5/502.1 


Water heater rentals are taxable. AWHR America's Water Heater Rentals, LLC v. Indiana Department of State Revenue, Ind. Tax Court, Cause No. 49T10-0710-TA-50, 07/15/2010


Point of purchase rebates for energy efficient appliances do not reduce the tax base. Kansas Private Letter Ruling P-2010-006, 09/09/2010

Labor to install fencing in new feedlots is not taxable. Labor to install fencing on new rangeland is taxable. Kansas Private Letter Ruling P-2010-007, 09/13/2010


Small cities and counties can get a rebate on the taxes collected on admissions to government facilities. Sales tax rebate on sales at a governmental facility, 07/16/2010


If a customer’s check is NSF, and you haven’t filed the return for the month that the sale was recorded, you can deduct that sale on line two of your return. Otherwise, you have to treat it as a bad debt. Massachusetts DOR Directive 10-3, 07/07/2010

Wind turbines and towers used to generate electricity for consumers are exempt. Massachusetts Letter Ruling 10-3, 07/07/2010


If you add a piece of equipment to a truck that is exempt under interstate commerce, it’s taxable, unless it replaces a component when it was sold. Michigan Internal Policy Directive 2010-1, 06/28/2010

New Jersey

Cable companies are being reminded that the equipment provided to customers is taxable. Notice to Cable Television Service Providers—Customer Premises Equipment, New Jersey Division of Taxation, 09/03/2010


Canned software delivered as “load and leave” was ruled to be not taxable. Filenet Corp. v. Director of Revenue, Mo. Admin. Hearing Commn., Dkt. No. 07-0146 RS, 08/20/2010

New Mexico 

A couple operating a babysitting service got busted for not filing gross receipts tax returns. In the Matter of the Protest of Flores, New Mexico Taxation and Revenue Department Decision and Order No. 10–05, 03/24/2010

New York

All Empire Zone exemptions expired on June 30, 2010 New York Technical Service Bureau Memorandum TSB-M-10(6)S, 06/30/2010

Movies delivered via satellite to theatres are not taxable since they aren’t TPP. But movies delivered on a hard drive ARE taxable. New York Advisory Opinion TSB-A-10(27)S, 06/29/2010

Roller coasters qualify as capital improvements. In the Matter of the Petition of Amusements of WNY, Inc., NYS Division of Tax Appeals, ALJ, Dkt. No. 822534, 08/04/2010

Auditor audits nightclub - can’t get records, even though he has the contact information for the previous owner. Auditor assesses the previous owner based on estimates. Auditor loses. The court said “deliberate chose the course of least resistance.” In the Matter of the Petition of John Smythe, NYS Division of Tax Appeals, ALJ, DTA No. 822160, 08/26/2010

Just a reminder - the clothing exemption is temporarily being suspended. New York Technical Service Bureau Memorandum TSB-M-10(16)S, 09/07/2010

If the dealer includes free oil changes for life in the price of a car, and clearly says so, then his purchases of oil are for resale. New York Advisory Opinion TSB-A-10(39)S, 09/14/201

South Carolina

SC has a pretty broad interpretation of taxable communications services. If the online service facilitates communications, or provides information, it’s a taxable communications service. S.C. Code Ann. § 12-36-60, S.C. Code Regs. § 117.329.4, South Carolina Private Letter Ruling 10-2, 07/29/2010


Own a server that’s kept in Texas? Or any TPP, for that matter. They say you’ve got nexus in Texus. 34 Tex. Admin. Code § 3.286, effective 07/11/2010 

There’s going to be an Energy Star holiday in May 2011. 34 Tex. Admin. Code 3.369, effective 09/09/2010


Out of state residents can purchase off-road vehicles tax free. Utah Informational Publication 5, 06/01/2010


They have a new data center exemption. It’s only for equipment and TPP for the data center, not general improvements to the building. Virginia Public Document Ruling 10-121, 06/29/2010

Energy star holiday 10/8 to 10/11 Virginia Public Document Ruling 10-222, 09/23/2010

West Virginia
Energy Star sales tax holiday through 11/30. West Virginia's Energy Star Sales Tax Holiday Begins, Governor's Press Release, 09/01/2010

The services of an IRS Enrolled Agent aren’t taxable as professional services - as long as they’re acting as one. West Virginia Administrative Notice 2010-25, 09/09/2010

The Sales Tax Guy

See the disclaimer - this is for education only.  Research these issues thoroughly before making decisions.  Remember: there are details we haven't discussed, and every state is different.  Here's more information

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