Certain Cleaning Services Exempt from New York Sales Tax

In an advisory opinion, the New York Department of Taxation and Finance concluded that a taxpayer’s carpet cleaning services are exempt from New York sales tax, but other cleaning services and floor repair services are subject to sales tax. Laundering and dry-cleaning services are excluded from taxable “maintaining, servicing, and repairing tangible personal property and real property” under New York Tax Law. The Department interpreted this exclusion to also encompass the services of cleaning rugs, wall-to-wall carpeting, draperies, and upholstery.

The taxpayer’s rug and carpet cleaning services fall within this exclusion and are not subject to sales tax. However, the charges for the rug/carpet cleaning services must be separately stated from other cleaning services on the invoice and the charges must be reasonable in relation to the overall charge. The taxpayer’s other cleaning services, such as window cleaning and the cleaning of uncarpeted floors, and any repair services are subject to New York sales tax.

Carpeting falls within the state’s definition of floor coverings which also includes linoleum and vinyl floor products. However, the department in this advisory opinion has deemed that carpet cleaning can be included within the laundering service category which is not subject to sales tax. (TSB-A-18(4)S, New York Commissioner of Taxation and Finance, August 20, 2018, released November 5, 2018)

Posted on November 8, 2018