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Business Taxes Law Guide—Revision 2024
Sales and Use Tax Annotations
A B C D E F G H I J L M N O P R S T U V W X
I
315.0000 Installing, Repairing, Reconditioning in General—Regulation 1546
Annotation 315.0287
(a) In General
315.0287 Reassembly Charges. A taxpayer sells and installs pumps. Customers may contract to purchase the pumps with or without installation. The taxpayer purchases pumps from an out-of-state manufacturer. The manufacturer assembles the pumps at the factory for testing and disassembles them for shipment. The taxpayer reassembles and installs the pumps at the customers' sites if the customer desires. The customers issue separate purchase orders for the pumps and for reassembly and installation. The taxpayer issues separate invoices. The negotiations for sale and for reassembly and installation are conducted separately and by different personnel.
Since the reassembly and installation are separately negotiated, ordered and invoiced, the charges are not charges related to the sale of tangible personal property. Reassembly constitutes reconditioning rather than fabrication regardless of whether it is performed by the manufacturer or a different person. Accordingly, tax does not apply to the charges for reassembly or installation. 4/22/88.