The N.C. Department of Revenue has published an updated notice that includes the complete list of all 49 Designated Counties that are eligible for relief. full details
Mailing will provide additional guidance to the annual Form E-505, which is available on the department’s website. full details
Written determinations are issued by the department in response to a taxpayer seeking specific tax advice. full details
The letter will go to HVAC, electrical, and plumbing contractors and will highlight sales tax law changes that go into effect Jan. 1, 2017, for the following: repair, maintenance, and installation services, real property contracts and service contracts. full details
Key Points of this directive include:
- Definitions for "real property," "real property contract," and "capital improvement" are enacted.
- A contract is taxed as a real property contract where the contract is for new construction, reconstruction, or remodeling with respect to a capital improvement to real property.
- Form E-589CI, Affidavit of Capital Improvement, will be required for many contracts to give notice to retailer-contractors and sub-contractors that any subcontract work should be taxed as a real property contract.
- Certain transactions by definition are capital improvements such as "landscaping services."
Key Points of this directive include:
- A person that only provides repair, maintenance, and installation services is a retailer.
- The imposition of sales and use tax on repair, maintenance, and installation services is expanded to digital property and real property, with certain statutory exemptions enacted.
- The definition of repair, maintenance, and installation services was expanded and clarified.
This notice addresses the application of the sales and use tax laws related to service contracts for the following changes:
- Expands sales and use tax to a contract that is for monitoring or inspecting.
- Provides that a contract may be for a period of time or some other defined measure (i.e. number of hours).
- Expands sales and use tax to a service contract for a pool, fish tank, or similar aquatic feature.
- Clarifies by definition that a home warranty is a service contract.
The notice addresses the application of the sales and use tax laws for the following changes:
- The definition of the term "motor vehicle service contract."
- The expansion of the exemption from sales and use tax to include contracts for one or more components, systems, or accessories of a motor vehicle sold by a motor vehicle dealer or by or on behalf of a motor vehicle service agreement company.
Notice Issued on Motor Vehicle Repair, Maintenance, and Installation Services; Storage; and Towing Services
The notice addresses the application of the sales and use tax laws related to or concerning motor vehicles for the following:
- Changes to the definition of "repair, maintenance, and installation services."
- A person who only provides "repair, maintenance, and installation services" is a "retailer."
- Enactment of specific exemptions for certain charges for repair, maintenance, and installation services.
- Separately stated storage charges for a motor vehicle are exempt from sales and use tax.
- Separately stated towing services for a motor vehicle are exempt from sales and use tax.
The N.C. Department of Revenue has published notices about penalty waivers and other benefits available to certain taxpayers. full details
NCDOR Publishes Important Notices on Sales Tax Law Changes
- NCDOR Publishes Form E-505
- Sales by Certain Nonprofits are No Longer Exempt from Sales Tax
- Law Change Allows Real Property Contractors to Use Erroneous Collection of Sales Tax to Offset Use Tax Due
- Certain Service Contracts Sold to a Professional Motorsports Team is Exempt from Sales Tax
- Notice Published On Fuel and Piped Natural Gas Used Solely for Comfort Heating by Certain Manufacturers
- NCDOR Publishes Notice on Alternate Highway Use Tax on a Lease or Rental Contract Sold to Another Retailer
- Privilege Tax Imposed on Certain Recyclers
New office features more private rooms for meetings with taxpayers. full details
Notice about market-based sourcing provides information on the publication of proposed administrative rules and includes examples and text of the rules. The agency has also announced a date for a public hearing to provide the opportunity for comment from the public. full details
This notice covers the exemption effective October 1, 2016 for certain products made of recycled materials. full details
Notice provides information on the adoption of administrative rules regarding market-based sourcing. full details
Notice provides information on the reduction of the corporate tax rate effective January 1, 2017. full details
The local rate increase from 2% to 2.25% is effective October 1, 2016. full details
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