Provision of Medical Equipment with Technician Services Taxable in New York

Wednesday, July 31st, 2013

New York

In a recent advisory opinion, the New York Department of Taxation and Finance held that certain "mobile medical services" were taxable. The services consisted of a taxable lease of medical equipment and a non-taxable sale of services.

The taxpayer provided medical equipment and staff to customers. There were separate charges for the medical equipment and staff services. The taxpayer's staff delivered the equipment to the customer's facility, set it up, and made sure it functioned properly. The taxpayer employed or contracted with licensed technicians to operate the equipment. The attending physician, an agent of the customer, directed the technician on whether, how, and when to use the equipment. The physician was in charge of the test or procedure and had final say in these matters.

New York taxes sales and leases of tangible personal property. For a transaction to be a lease, the customer must get (1) custody or possession of the property, (2) the right to custody or possession of the property, or (3) the right to use, control, or direct the use of the property. New York only taxes services that it specifically enumerates as taxable. The question here was whether the transaction was just the sale of services or whether it was a lease of the equipment plus the sale of staff services.

The Department of Taxation and Finance held that the transaction involved a lease as well as a sale of services. Although the taxpayer's staff operated the equipment, they did so at the direction of the attending physician. The customer therefore had the right to direct the use of the equipment. Because the customer received the right to control or direct the use of the equipment, there was a lease. The transaction was subject to tax as a lease of tangible personal property. The separately stated charges for the staff's services were not taxable because New York does not specifically enumerate these services as taxable.

About TTR

Transaction (buying or selling things), Tax (the tax on this activity), Resources (our people, our website, our support services) - TTR, Inc.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at or call 866.578.8193.

Data Survey Services Not Taxable in South Carolina

Monday, June 24th, 2019 -The South Carolina Department of Revenue recently ruled that business data survey services were non-taxable pr...

Senior Center Cafeterias are Taxable in Missouri

Friday, June 21st, 2019 -Missouri's Director of Revenue recently issued a letter ruling taxing the sale of cafeteria food by a 501(c)(3...

Hot-Air Balloon Rides in Missouri are Taxable When...

Wednesday, June 19th, 2019 -Missouri recently released a letter ruling addressing the taxation of hot-air balloon rides. The taxpayer was ...

Nevada Exempts Certain Medical Equipment

Monday, June 17th, 2019 -Effective July 1, 2019, Nevada will exempt durable medical equipment, oxygen delivery equipment, and mobility ...

Participatory Sports are Taxable in New York

Friday, June 14th, 2019 -The New York Division of Tax Appeals recently denied a refund claim made by an instructor-led indoor spin clas...

Marketplace Facilitators to Collect Tax in Vermont

Thursday, June 13th, 2019 -Vermont recently passed a bill requiring marketplace facilitators to collect and remit sales tax on retail sal...