Louisiana amended its Civil Code to define component parts of an immovable and those items permanently attached to immovables. This clarification is critical as the state sales tax law does not treat repairs to immovable property as taxable services. Anything…
Raw Materials, Tools, and Wiring May Be Exempt In Fabrication
Tools acquired for use in the fabrication of tangible personal property are exempt from Indiana sales tax. An exemption is also extended for raw materials incorporated into manufactured, refined, or assembled tangible personal property for resale. Wiring and other parts…
Construction Materials Assembled Out-of-State Are Subject to North Carolina Use Tax
The North Carolina Court of Appeals ruled that tangible personal property procured outside the state, such as building components, is subject to use tax when it becomes part of a building or structure in North Carolina. Materials are not exempt…
Contractors, Not Customers, Owe Tax On Installation Of Cabinetry, Countertops In Florida
According to a Florida Technical Assistance Advisement, the installation of built-in cabinetry, countertops, and millwork is treated as an improvement to real property. Contractors engaged in a lump sum contract are considered final consumers of materials and supplies used in…
Alaska Prohibits Tax on State Construction Contracts
Alaska boroughs and cities are prohibited from levying a sales or use tax on construction contracts awarded by the state or a state agency. This rule further extends to a subcontract that is connected with the project funded as part…
Kansas: Articles Fabricated on Job Site Sourced to Point of Delivery
The Kansas Department of Revenue explained that items purchased for use in fabricating metal roofs on job sites are sourced to the jurisdiction of the delivery warehouse rather than the jurisdiction of the job site.
Tennessee Court of Appeals Rules on Materials Incorporated into Churches
The Tennessee Court of Appeals has ruled that a taxpayer’s purchase of raw materials that were fabricated into steel products and later installed into churches were not entitled to a sales tax exemption. The court found that the materials were…
Florida Finds Machinery Used to Construct Electric Generating Unit is Exempt.
The State of Florida issued a Technical Assistance Advisement that found that purchases of machinery and equipment for use in a contract between a city and a contractor to construct exempt electricity generating units are exempt from state sales tax.
Pennsylvania Issues Letter Ruling Stating Purchases of Stadium Turf by a College are Exempt from Tax.
The Pennsylvania Department of Revenue recently issued a letter ruling stating that a college qualifying as a purely public charity is not liable for sales and use tax on a contract for the purchase and installation of an artificial playing…
Mississippi Enacts Bill Discussing Unqualified Contracts and Levying a Contractor’s Sales Tax
The Mississippi Governor has signed S.B. 2746, which, effective July 1, 2005, levies a contractor\’s sales tax and provides for the issuance of a jeopardy assessment, lien, and warrant against unqualified contracts and contracts for which taxes have not been prepaid or bonded in a proper manner.
South Dakota Governor Signs Bill Providing for Sales and Use Tax Refunds to Certain Fabricators.
The South Dakota Governor has signed H.B. 1142, which provides for certain fabricators to apply for a sales and use tax refund. The bill, which becomes effective July 1, 2005, states that a contractor or subcontractor licensed pursuant to Chapter…
South Dakota Creates Bid Calculator for Contractors and Discusses Tax Responsibilities of Specialty Builders.
Citing the significant increase in new home building in a recent edition of South Dakota Taxation News, the South Dakota Department of Revenue and Regulation discussed the addition of a bid calculator for contractors. The Department stated that since they…
Pennsylvania Clarifies Taxability of Contractor’s Purchases for a Federal Government Contract.
The State of Pennsylvania has issued a Letter Ruling clarifying that a contractor’s purchase of building machinery and equipment used in conjunction with a Federal Government contract are exempt from tax. The Letter Ruling defined that the term building machinery…
Connecticut issues new building contractor’s tax guide.
The Connecticut Department of Revenue Services has issued Informational Publication 2004(29), which replaces Informational Publication 99(19).
Georgia Court of Appeals issues decision that a contractor performing a contract for a governmental entity is still subject to tax.
In a decision rendered by the 4th Division of the Georgia Court of Appeals, a contractor was required to pay sales and use taxes to the State of Georgia even though…
Florida provides guidance on Taxation of Permanent and Removable Shutters.
The Florida Department of Revenue issued guidance to a contractor who was installing both permanent and removable storm shutters on the same contract.
Wisconsin publication provides sales and use tax information for contractors.
In Publication 207, Wisconsin presents information regarding the classification of certain products and services typically provided by contractors. Among other things, the publication clarifies that computer cabling is a part of communications equipment, retaining walls are real property regardless of…
Arizona Provides Exemption for Service Fees in Construction Contracts.
The Arizona Legislature has passed a bill exempting engineering and architectural services that are incorporated into a design-build construction contract. These services, charged for separately have always been exempt; however, they were taxable when included in a single contract. Now…
Pennsylvania Discusses Taxability of Items Used in School Construction.
In a new ruling, the Pennsylvania Department of Revenue discusses the items used in construction of public schools that are exempt from sales tax. They state in the release that building equipment and machinery are exempt when applied to a…
New York Places Restrictions on Contracts.
Under New York’s new budget package, contracts can be rendered invalid if a contractor is not registered for sales and use tax purposes. If a contractor or subcontractor makes sales deliveries of taxable services or tangible personal property by any…
Virginia Gives Credit to Construction Contracts Against Rate Increase.
The legislation for Virginia’s recent rate increase includes a provision for a refund of the additional sales tax paid under the increase for certain contracts. Taxpayers will still be subject to the 5% tax effective September 1, 2004 but will…
West Virginia waives sales and use taxes for flood victims.
To aid in the reconstruction of property damaged or destroyed in the flooding of Spring, 2004, West Virginia governor Bob Wise has signed an executive order exempting all construction materials directly consumed in the rebuilding of flood-damaged structures. This exemption…
New Jersey offers exemptions for relocating businesses.
In an effort to encourage business growth, New Jersey is offering various tax credits and exemptions to businesses expanding their operations in the state. Specifically these tax benefits will apply to corporate headquarters expansions and to corporations involved in the…
Nebraska clarifies rules for contractors on remittance of tax.
The Nebraska Department of Revenue has ruled that contractors using accrual basis accounting and receiving more than one payment on a taxable project are responsible for collecting and remitting Nebraska sales tax on each payment. Contractors receiving only one payment…