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sales tax manufacturing exemption " Reprographics"

  • 1.  sales tax manufacturing exemption " Reprographics"

    Posted 10-17-2018 14:26
    ​My Client purchased a machine to do Reprographics. (this is basically a sophisticated copy machine)  Contractors supply my client with drawings/blueprints usually in digital format. My client than generates these blueprints and charges sales tax. is the purchase of this machine exempt from New York State sales tax under the manufacturing exemption. Any help/authority is greatly appreciated.

    Rich

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    Richard Trisciuzzi
    Richard Tris, CPA
    Nesconset NY
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  • 2.  RE: sales tax manufacturing exemption " Reprographics"

    Posted 10-18-2018 12:42

    Machinery, Equipment, Materials, and Services Used in Production

    Tax Bulletin ST-552 (TB-ST-552)


    Machinery and equipment used directly and predominantly in the production of tangible personal property for sale can be purchased exempt from sales tax using Form ST-121, Exempt Use Certificate. Machinery and equipment used in the administration or distribution phases does not qualify for the exemption.

    Directly means that during the production phase the machinery or equipment must:

    • act upon or effect a change in material to form the product to be sold;
    • have an active and necessary role in the production of the product for sale;
    • be used in handling, storage, or conveyance of materials or the product to be sold; or
    • be used to package the product for sale.

    So your client receives dimensional prints/manufacturing drawings. Those prints/drawings are the  materials used directly in the production of Blueprints.

    I would think yes it is exempt.

    My first thought was, is this a manufacturing company?  Honestly I think that is a discussion in itself, but I went along with it.




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    DANIEL HARRIGAN
    RONALD A MERMER CPA PC
    FISHKILL NY
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  • 3.  RE: sales tax manufacturing exemption " Reprographics"

    Posted 10-18-2018 17:36
    ​Hello Dan, thank you for responding. Before adding this post I also pulled this bulletin. Called NYS they said NO. making copies is not manufacturing. I hope to get a better explanation. I think it may qualify but not sure

    Rich

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    Richard Trisciuzzi
    Richard Iris, CPA
    Nesconset NY
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  • 4.  RE: sales tax manufacturing exemption " Reprographics"

    Posted 10-19-2018 09:00
    Ah I was afraid of that.  Curious on the out come though. Keep us posted :)


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    DANIEL HARRIGAN
    RONALD A MERMER CPA PC
    FISHKILL NY
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