Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2014
 

Sales and Use Tax Annotations


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R

490.0000 RETURNS, DEFECTS AND REPLACEMENTS—Regulation 1655

Annotation 490.0660

(c) WARRANTIES

(2) Warranty Charges—When Includable In Tax Measure

490.0660 Service Guarantees on Automobiles. The sale of automobile guarantees as a part of the sale of the automobile it warrants should be treated for tax purposes in the same manner as are television warranties, that is, any amount charged for the warranty should be included in the taxable measure. However, when the warranty is sold on a strictly optional basis, the tax does not apply. The sale of parts by the repairman to the guarantor are considered as being made to a consumer and therefore taxable. 7/18/57.