Taxpayer's Purchase of Mist Coolant Taxable in Indiana

Wednesday, April 2nd, 2014

 
 
Share
Link
Indiana
General

The Indiana Department of Revenue ("Department") recently released a letter of findings determining that a manufacturer owed tax on its purchases of mist coolant.

The taxpayer manufactured and installed floating dock systems, boat lifts, and similar items. To make posts for docks, the taxpayer used a horizontal drill. The taxpayer purchased an air powered mist coolant to keep this drill cool.

Indiana exempts sales of machinery, tools, and equipment used directly in manufacturing tangible personal property. An item is used directly in manufacturing if it has an immediate effect on the article being produced.

The Department held that the coolant did not qualify for this exemption. The taxpayer did not provide any evidence that the coolant had an immediate effect on the dock post being made. The taxpayer only showed that the coolant affected the drill. The taxpayer therefore owed tax on its purchase of the coolant.

http://www.in.gov/legislative/iac/20140326-IR-045140088NRA.xml.html


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 www.ttrus.com or call 866.578.8193.

Service Repairs to Petroleum Storage Tanks Exempt in...

Friday, January 18th, 2019 -Louisiana's Board of Tax Appeals recently ruled that repairs on petroleum storage tanks were not taxable. ...

Nevada Exempts Feminine Hygiene Products in 2019

Wednesday, January 16th, 2019 -Last year, Nevada voters approved via ballot measure changes to the Sales and Use Tax Act of 1955. Voters amen...

Cleaning of Beer-Tap Lines Not Taxable in Ohio

Monday, January 14th, 2019 -The Supreme Court of Ohio recently ruled that cleaning beer-tap lines is not taxable. The taxpayer was...

Louisiana Court of Appeals Finds Marketplace Facilitators...

Friday, January 11th, 2019 -The Louisiana Court of Appeals has recently addressed the sales tax liability of marketplace facilitators. A c...

Iowa Supreme Court Determines Taxable Carpentry Services...

Wednesday, January 9th, 2019 -The Iowa Supreme Court has recently addressed the taxability of various installation services. The taxpayer wa...

Tax Applies to Metallurgical Coke in Illinois

Monday, January 7th, 2019 -Illinois recently ruled that use tax was due on purchases of metallurgical coke. The taxpayer was a business t...