Medical Supplies Used for Testing Taxable in North Carolina

Monday, August 31st, 2015

 
 
A doctor putting on gloves.
Share
Link
North Carolina
Healthcare

The North Carolina Business Court ("Court") ruled that medical supplies used for prescribed tests were taxable.

The taxpayer conducted sleep study testing. The taxpayer performed sleep study tests prescribed by doctors. It used various supplies to perform these tests, including cleaners, sensors, exam gloves, disinfectant, and batteries. A patient's prescription for sleep testing did not entitle the patient to purchase these supplies, and the taxpayer did not itemize the supplies on invoices to patients. Instead, it billed a lump sum for sleep study testing.

North Carolina exempts durable medical supplies sold on prescription. The taxpayer argued that its supplies qualified for this exemption.

The Court determined that the taxpayer's supplies were not "sold on prescription." The taxpayer consumed the supplies during testing. It did not transfer ownership of the supplies to patients, so there was no sale to the patients. Also, the patients' prescriptions were for testing, not for supplies. The supplies themselves were not prescribed, so they were taxable.

http://www.ncbusinesscourt.net/opinions/2015_NCBC_81.pdf


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.

Texas Releases Detailed Guidance on Exempt Organizations

Thursday, October 18th, 2018 -The Texas Comptroller has released a publication that provides detailed information on how sales and use tax a...

Telephone Answering Services Taxable in Arkansas

Tuesday, October 16th, 2018 -The Arkansas Department of Finance and Administration recently ruled that the service of answering calls on be...

Washington Provides Guidance on Lodging Tax for Online...

Friday, October 12th, 2018 -The Washington Department of Revenue released updated guidance that provides tax reporting information for bed...

Economic Nexus in West Virginia

Wednesday, October 10th, 2018 -The West Virginia State Tax Department announced that it will require remote sellers to begin collecting sales...

Idaho Provides Guidance on the Exemption for Medical...

Monday, October 8th, 2018 -The Idaho State Tax Commission recently released guidance that explains Idaho's sales and use tax laws for buy...

Arkansas Does Not Follow Federal Law on Foreign Income

Friday, October 5th, 2018 -The Arkansas Department of Taxation and Finance recently released an opinion that says the state does not conf...