sales tax in NJ

Posted by loch on September 17, 2008, 2:09 pm

Hi all,

What does this phrase from the NJ sales tax guidance mean?

"The purchase and installation of an air conditioner is taxable when
the unit is placed into an existing space
or metal casing that is part of a structure. An air conditioner that
can be removed from its casing by the
owner is not a capital improvement and remains tangible personal
property."

When is an central air conditioner not put into an 'existing space'?
Every AC unit, brand new or a replacement is put into an existing
space, not into outer space or something.

So if we replaced a 20 year old unit with new compressor, blower,
condenser - are we supposed to pay sales tax?

Posted by Zyp on September 17, 2008, 2:37 pm

loch wrote:

> Hi all,
> What does this phrase from the NJ sales tax guidance mean?
> "The purchase and installation of an air conditioner is taxable when
> the unit is placed into an existing space
> or metal casing that is part of a structure. An air conditioner that
> can be removed from its casing by the
> owner is not a capital improvement and remains tangible personal
> property."
> When is an central air conditioner not put into an 'existing space'?
> Every AC unit, brand new or a replacement is put into an existing
> space, not into outer space or something.
> So if we replaced a 20 year old unit with new compressor, blower,
> condenser - are we supposed to pay sales tax?

Oh yea. Sales tax is due on your cost.

--
Zyp

Posted by old and grunpy on October 20, 2008, 8:09 pm

> loch wrote:

>> Hi all,

Take it from first hand experience with States
NY and NJ any maintenance regardless of type is subject to sales tax
All material that is not resold by your customer is subject to sales tax
One example if you purchase let say 40 pieces of two x four and
you use 20 to make work bench the other 20 you have use in new
construction project, 20 that you have use for bench are taxi able
and the other 20 are exempt from tax if is new construction.
that will same applied to any tread regardless.
This is explanation I was giving and I am still fighting State of NJ
from three years ago, the only thing that so far is exempt
from sale's tax is tolls you pay for and you pas it on to customer.
Good luck Tony-S

>> What does this phrase from the NJ sales tax guidance mean?
>> "The purchase and installation of an air conditioner is taxable when
>> the unit is placed into an existing space
>> or metal casing that is part of a structure. An air conditioner that
>> can be removed from its casing by the
>> owner is not a capital improvement and remains tangible personal
>> property."
>> When is an central air conditioner not put into an 'existing space'?
>> Every AC unit, brand new or a replacement is put into an existing
>> space, not into outer space or something.
>> So if we replaced a 20 year old unit with new compressor, blower,
>> condenser - are we supposed to pay sales tax?

> Oh yea. Sales tax is due on your cost.
> --
> Zyp

Posted by Dave Smith on September 17, 2008, 7:47 pm

I believe the first sentence refers to central units, mini splits and ptacs.
The second to window units et al and long term (depreciation) tax
implications. You'll pay sales tax on either.

Posted by loch on September 17, 2008, 10:00 pm

> > Hi all,
> > What does this phrase from the NJ sales tax guidance mean?
> > "The purchase and installation of an air conditioner is taxable when
> > the unit is placed into an existing space
> > or metal casing that is part of a structure. An air conditioner that
> > can be removed from its casing by the
> > owner is not a capital improvement and remains tangible personal
> > property."

> I believe the first sentence refers to central units, mini splits and pta=

cs.

> The second to window units et al and long term (depreciation) tax
> implications. You'll pay sales tax on either.

So what is left? Because that paragraph is part of a whole guidance on
how there is no sales tax on HVAC with the exception of what is
described in that para.

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