Effective July 1, 2004, several law changes will directly affect the taxation of contractor labor charges. The changes include the following: (1) Contractors will be allowed to sell their labor tax-free to another contractor; (2) Option 2 and Option 3…
Tangible personal property used for construction of symphony hall in Georgia exempt.
From May 5, 2004 until September 1, 2009, sales of tangible personal property used directly for the construction of a new symphony hall is exempt from sales tax. The construction cost of the facility must be equal to or more…
West Virginia Truck Scales Deemed Taxable as Capital Improvement.
In a West Virginia Circuit Court, a petitioner, doing business selling and installing truck scales, was found liable for tax based on the definition of capital improvement and how it relates to this type of contract. “Capital Improvement” is defined…
Wyoming Janitorial Services Not Taxable.
Janitorial services are not taxable in the state of Wyoming because the individuals working this type of service are deemed real property contractors. The Wyoming Department of Revenue does not license these individuals as vendors so they have absolutely no…
Louisiana Definition For “Tangible Personal Property” Amended.
Louisiana Legislature has decided to amend the term \”tangible personal property\” to no longer include \”other constructions\” permanently attached to the ground.
Iowa construction contractor’s materials subject to tax.
In order for construction contractors to buy building materials exempt from tax they must receive both an authorization letter and exemption certificate from an exempt entity.
Indiana Installation and Delivery Charges Clarified.
Indiana has made changes to the taxability of installation and the rules for delivery taxability.
Massachusetts Kitchen Remodeler Not Required to Collect Tax
Classic Kitchens, Inc. v Commissioner of Revenue found that a kitchen remodeling business was not required to collect tax on partially constructed cabinets and countertops.
Texas Parking Lot Repair Deemed Taxable.
In a hearing by the Texas Administrative Hearings Section (AHS), a taxpayer was found liable for taxes associated with parking lot construction because the parking lot was repaired, not newly constructed. For the taxpayer’s services to have been considered nontaxable,…
Kansas Optometrist Not Eligible for Project Exemption Certificate.
An optometrist building a new facility in an enterprise zone was denied a request for a Project Exemption Certificate on the grounds that the business is considered to be a retailer under the Kansas Enterprise Zone Act (KEZA).
Alabama retailer responsible for tax on construction supplies and devices.
In Alabama, a retailer selling highway construction supplies and devices tax-free to contractors doing contract work for the Alabama Department of Transportation was found liable for sales tax. The items sold included permanent and temporary signs, barrels and cones, flashing…
Continuation of Texas new construction project did not change taxability.
In Texas, the owner of a commercial building moved in prior to the building\’s completion.
Florida materials used for improvements to real property taxable.
The petitioner, in this particular case, produced control panels which, when installed, made improvements to the real property.
New York one-time sewage connection fee is a taxable activity.
In an advisory opinion given by the state of New York Commission of Taxation and Finance, the department determined that the petitioner, a company which specializes in sewage services, was liable for sales tax on a one-time charge for connection…
Arizona Construction Manager Not Responsible for Tax.
In Arizona, subcontractors contracted to do work separately from the “prime contractor” are responsible for the Arizona transaction privilege tax obligation on their part of the job. In the case of Ormond Builders, Inc. v. Arizona Department of Revenue, a…
North Carolina Modular Home Sales Explained.
The manufactured home classification will no longer apply to modular home sales in North Carolina. As of January 1, 2004, the sale of a modular homes will have an applicable sales tax rate of 2.5%. Also, the tax will have…
Idaho refund for building contractors.
A recent press release indicated that building contractors may qualify for sales tax refunds.
Appliances for apartments in Washington not considered real property.
A Washington company, when acquiring an apartment complex, also purchased several different appliances contained in the apartments and paid use tax on them since they were reported as tangible personal property. However, the company later decided to request a refund…
Wyoming railroad not liable for sales tax.
A railroad company, acting as a common carrier while delivering construction ballasts to users in other states, was found not to be liable for Wyoming sales and use tax because these types of transactions were deemed to be destination sales.…
Arizona contractor denied land-value deduction.
In a recent decision by the Arizona Court of Appeals, a prime contractor was denied its challenge of an auditor’s reduction of the original assessed land-value deduction towards the contractor’s sales and use tax liability. The contractor’s business is the…
Nevada construction contractors’ liability.
Construction contractors providing new construction or doing a remodel of real property can show time and materials pricing on the invoices they provide their customers but cannot tax the customer for the materials. The tax liability is taken care of…
Texas lot surveying service not taxable.
In the state of Texas, lot staking surveying is not a taxable service as long as the services being performed are for a new residential structure. However, these surveying services will be taxable if they are performed as an improvement…
Option 1 contractors taxation in Nebraska clarified.
Any labor affiliated with the sale of property to be attached to become real property by an Option 1 contractor will be taxable. The only exception would be if the attachment was purely incidental to the transfer of a building.…
California exemption explained.
In the state of California, the government exemption for sales and use tax does not apply to federal contractors purchasing materials for the job because they are not considered agents of the government. This would also include construction contractors. However,…