Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2017
Sales and Use Tax Annotations
190.0000 CONSTRUCTION CONTRACTORS—Regulation 1521
(a) IN GENERAL—ACTIVITIES CONSTITUTING CONTRACTING OR MAKING OF IMPROVEMENTS
190.0178 Doors and Windows. A door and window firm transfers doors and windows to a general contractor at a marked up price and assumes the following duties: works with the architect and builder to estimate material needs, delivers the materials to the building site, may actually "help with the installation," and replaces any damaged or broken doors and windows.
The key issue is whether the door and window firm is contractually responsible for installation of the materials provided. A retailer who furnishes material but does not install it incurs a sales tax liability measured by the retail sales price, including markup. A subcontractor who both furnishes and installs materials owes tax only on the cost of the materials. From the information provided, the door and window firm is not contractually responsible for installation, although it may help someone else install the materials. Since the door and window firm is not contractually obligated to both furnish and install the windows and doors, it is the retailer of those materials and the entire charge to the general contractor, including any markup, is taxable. 3/31/89.