Sales of Orthopedic Prosthetic Devices to Hospitals Ruled Taxable in South Carolina

Friday, April 22nd, 2016

Orthopedic prosthetic devices.
South Carolina

The South Carolina Supreme Court ruled that a hospital's purchases of orthopedic prosthetic devices were taxable.

A hospital provided surgeries to implant orthopedic prosthetic devices in patients. Before the surgeries, a doctor would choose the appropriate device from a prosthetic device vendor. The hospital paid for the device and paid tax on the purchase. It later asked for a refund of the taxes it paid, claiming that the sales were exempt.

South Carolina taxes hospitals' purchases of items used to provide services unless an exemption applies. The sale of a prosthetic device is exempt when the sale requires a prescription. The Court explained that these sales did not require a prescription because federal regulations permitted the doctors to purchase the devices without a prescription. As a result, the Court concluded that the sales were taxable.

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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.

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