Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2013
Sales and Use Tax Annotations
190.0000 CONSTRUCTION CONTRACTORS—Regulation 1521
(b) SPECIFIC PROPERTY AS "MATERIALS" OR "FIXTURES"
190.2105 Remodeling. A taxpayer contracts to reface existing installed kitchen cabinets. This consists of removing the cabinet doors and either replacing them,
restaining them or reveneering them. The taxpayer is the consumer of all property used to perform the contract. The property is regarded as "materials" and no tax applies to the labor charges.
If the taxpayer contracts to remove old kitchen cabinets and to install new kitchen cabinets, the application of tax will depend upon the degree to which the new cabinets are prefabricated. Subdivision (C)(2) of Regulation 1521 describes the application of tax to cabinets.
The taxpayer contracts to remove old windows and to replace them. Windows and window frames are "materials." The taxpayer is the consumer. Tax applies to the cost of the windows to the taxpayer, but not to labor charges. If the manufacturer of the windows also installs them, the manufacturer is the consumer of the materials used to fabricate the windows and tax will apply to the manufacturer's material cost, but not to any labor costs.
The taxpayer contracts to cut a used nine-foot table into three-foot sections and to install hardware. If the end result is three small tables, the entire charge will be taxable on the basis that the labor involved is fabrication labor. If the end result is a single table the job is regarded as a repair job and tax applies in accordance with Regulation 1546. 8/29/94.