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. After the initial occupation, the owner found out that several improvements still needed to be made per the original contract. Once the owner vacated the premises, the question came up whether the continued construction would still be considered “new construction” for tax purposes. In a private letter ruling, the Texas Comptroller decided that the work performed by the original contractor to complete the project was still considered new construction and the owner’s temporary occupation of the building did not change the taxability. (Private Letter Ruling #200312323L, Texas Comptroller of Public Accounts, December 12, 2003)

Posted on March 15, 2004