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Sales of speech generating devices, accessories, and extended warranties in Florida are exempt from sales and use tax as long as the purchase was made according to an individual prescription written by a physician. The sale of these items to educational facilities and non-profit organizations is also exempt from Florida sales tax if the sale qualifies for the above exemption. “Prosthetic and orthopedic appliances” qualifying for the sales tax exemption include those devices that alleviate the malfunction of any part of the body. Speech generating devices that are sold to persons with speech impairment (or their caretakers) with a prescription are intended to alleviate the malfunction that causes the impairment. As a result, the devices are exempt from sales and use tax. (Technical Assistance Advisement, No. 10A-047, Florida Department of Revenue, November 16, 2010, released January 2011)

(04/19/2011)

A Florida business that reprocesses, repairs, and refurbishes medical devices and equipment and sells them with a label indicating that the products are refurbished and intended for single use is exempt from Florida sales and use tax on sales of the products. The applicable regulation states that medical products, supplies, or devices sold to hospitals, healthcare entities, and licensed practitioners are exempt when they are dispensed under federal or state law only by the prescription or order of a licensed practitioner and are intended for use on a single patient and not intended to be reusable. The business is required to maintain records evidencing that each product bears the label, “Caution: Federal Law restricts this device for sale by or on the order of a physician…Reprocessed device for single use.” (Technical Assistance Advisement, No. 10A-046, Florida Department of Revenue, November 5, 2010, released January 2011)

(04/19/2011)

The sale of steerable guide catheters and clip delivery systems is exempt from Florida sales and use tax as they are prescribed medical devices used in the treatment of injury, disease, or incapacity of a patient that are temporarily or permanently incorporated into a patient by a licensed medical practitioner. Medical devices are defined as items that are intended or designed to be used for a medical purpose to treat, prevent, or diagnose human disease, illness or injury. Sales of medical devices are exempt from Florida sales tax when sold pursuant to a written prescription from a qualifying medical practitioner. (Technical Assistance Advisement, No. 10A-036, Florida Department of Revenue, August 4, 2010)

(04/19/2011)

The Florida Department of Revenue has issued a technical assistance advisement clarifying the taxability of payments on rentals of equipment from Florida dealers that are removed from the state. Rental payments made after equipment has been removed from Florida are not subject to sales and use tax. Rental payments made to the dealer prior to removing the equipment from Florida are subject to sales and use tax. In the former situation, the taxpayer’s rental of items is exempt from Florida sales and use tax provided that they furnish the Florida dealer with a signed certificate identifying the items and the date that the items were removed or will be removed from Florida. The Department of Revenue has provided a suggested format for the certificate. (Technical Assistance Advisement, No. 11A-003, Florida Department of Revenue, February 1, 2011)

(04/13/2011)

The Florida Department of Revenue has issued guidance concerning contracts to sell and install countertops and cabinets. Contracts to sell and install countertops, kitchen cabinets and knobs are considered real property contracts. As a result, contractors entering into such a contract should not charge Florida sales tax to the customer. Instead, contractors owe use tax on the fabricated cost of those items. The aforementioned items are classified as improvements to real property once they are installed, thus contractors selling and installing them are making improvements to real property regardless of whether the contractor separates on the invoice charges for materials and labor. However, if the contract is a retail sale plus installation then sales tax should be charged to the customer. If a taxpayer has previously paid sales tax to a contractor on a real property contract, they must secure a tax refund from the contractor and not from the Florida Department of Revenue. Any refund of tax to the contractor from the Department of Revenue will be offset by the use tax it owes on the fabricated cost of the items if it hasn’t already been paid. (Technical Assistance Advisement, No. 10A-042, Florida Department of Revenue, August 17, 2010)

(02/06/2011)

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