34 Tex. Admin. Code § 3.306 - Sales of Mobile Offices, Oilfield Portable Units, Portable Buildings, Prefabricated Buildings, and Ready-Built Homes
(a)
Definitions. The following words and terms when used in this section shall have
the following meanings, unless the context clearly indicates otherwise.
(1) Bunkhouse--This term has the meaning
given in §
3.72 of this title (relating to
Trailers, Farm Machines, and Timber Machines).
(2) Contract for the improvement to realty--A
contract, as described in §
3.347(a) of this
title (relating to Improvements to Realty). Such a contract includes
installation or set-up performed to permanently affix a structure defined in
this section to real property.
(3)
House trailer--This term has the meaning given in §
3.72 of this title.
(4) Installation or set-up--Activities
associated with either a contract for the improvement to real property or the
temporary placement of a structure defined in this section, including, but not
limited to, spotting the structure; preparing the foundation; connecting
separate sections of the structure, if any; placing, blocking, leveling, and
anchoring the structure; connecting sewer, water, electricity, and other
utilities; and installing skirting, awnings, and steps.
(5) Manufactured home--This term has the
meaning given in §
3.481 of this title (relating to
Imposition and Collection of Manufactured Housing Tax).
(6) Mobile office--A self-contained
transportable structure built on a permanent chassis, with or without wheels,
axles, and a towing device, that is designed to be used as an office, sales
outlet, or other work place, such as a self-contained portable bathroom or a
portable on-site dressing room. A food and beverage concession trailer is an
example of a towable structure designed to be used as a sales outlet or other
work place.
(7) Oilfield portable
unit.
(A) A self-contained transportable
structure built on a permanent chassis, with or without wheels, axles, and a
towing device, designed to be used for temporary lodging or temporary office
space that:
(i) does not require attachment
to a foundation or real property to be functional;
(ii) is located exclusively upon, or
immediately adjacent to, the lease premises or assigned acreage of an oil, gas,
water disposal, or injection well located within an oil or gas lease, field,
pooled unit, or unitized tract;
(iii) is used exclusively to provide sleeping
accommodations, temporary office space, or any other temporary work space for
employees, contractors, or other workers at an oil, gas, water disposal, or
injection well; and
(iv) is not a
travel trailer, camper trailer, or recreational vehicle.
(B) Examples of items that qualify as an
oilfield portable unit when located and used exclusively as provided in this
paragraph include, but are not limited to, a bunkhouse, trailer, semitrailer,
park model, house trailer, and manufactured home. For more information
regarding the taxation of travel trailers, camper trailers, and recreational
vehicles, refer to §
3.72 of this title.
(8) Park model--This term has the
meaning given in §
3.481 of this title.
(9) Portable building--A self-contained
transportable structure that does not require attachment to a foundation or to
realty in order to be functional. An example of a portable building is a tool
shed.
(10) Prefabricated
building--A structure, not designed to be a residential dwelling, built at a
location other than its permanent site, and that is later transported in one or
more sections and affixed to real property.
(11) Ready-built home--A structure that does
not bear a label or decal issued by the Texas Department of Licensing and
Regulation, the Texas Department of Housing and Community Affairs, or the U.S.
Department of Housing and Urban Development, but that is designed to be a
residential dwelling which is constructed, precut, partially assembled, or
fabricated in whole or in part at a location other than the home site and
subsequently transported, in one or more sections, to the home site, where it
is assembled on a permanent foundation.
(12) Travel trailer or recreational
vehicle--This term has the meaning given in §
3.72 of this title.
(13) The terms mobile home, ready-built home,
prefabricated building, and portable building do not include a house trailer,
as defined in and subject to the provisions of Tax Code, Chapter 152, or a
manufactured home, as defined in and subject to the provisions of Tax Code,
Chapter 158. See §
3.72 and §
3.481 of this title.
(b) Application of the sales and
use tax to mobile offices, oilfield portable units, portable buildings,
prefabricated buildings, ready-built homes, and tangible personal property.
(1) Mobile offices. A sale, lease, or rental
of a mobile office is a taxable sale of tangible personal property. Sales tax
is due on the total sales price charged by the seller, including charges for
delivery and installation or set-up, even if separately stated on the invoice
issued to the purchaser. See §
3.303 of this title (relating to
Transportation and Delivery Charges) and §
3.294 of this title (relating to
Rental and Lease of Tangible Personal Property).
(2) Oilfield portable units. A sale, lease,
or rental of an oilfield portable unit is subject to sales tax. Sales tax is
due on the total sales price charged by the seller, including charges for
delivery and installation or set-up, even if separately stated on the invoice
issued to the purchaser. See §
3.303 and §
3.294 of this title.
(A) An oilfield portable unit that ceases to
be used exclusively as an oilfield portable unit, as required by this section,
and that meets the definition of a motor vehicle, pursuant to Tax Code, §
152.001(3),
is subject to tax imposed by Tax Code, Chapter 152. Examples include
bunkhouses, trailers, semitrailers, park models, or house trailers. For more
information regarding the application of the Motor Vehicle Sales Tax to
oilfield portable units, refer to §
3.72(c) of this
title.
(B) The lease or rental of a
manufactured home as defined in §
3.481 of this title that ceases to
be used exclusively as an oilfield portable unit as required by this section is
subject to hotel occupancy tax as provided under Tax Code, Chapter
156.
(3) Portable
buildings. A sale, lease, or rental of a portable building is a taxable sale of
tangible personal property. Sales tax is due on the total sales price charged
by the seller, including charges for delivery and installation or set-up, even
if separately stated on the invoice issued to the purchaser. See §
3.303 and §
3.294 of this title.
(4) Prefabricated buildings and ready-built
homes.
(A) A contract to sell a prefabricated
building or a ready-built home is considered a contract for an improvement to
real property when the seller is required to build, transport, and affix the
structure to a permanent site. See §
3.347 of this title. If the
contract requires the seller to perform installation or set-up services, the
seller's sales tax responsibilities are determined by whether the contract is a
lump-sum contract or a contract that separately states charges for materials
and labor. See §
3.291 of this title (relating to
Contractors).
(B) The sale of a
ready-built home or a prefabricated building that is not at the time of sale
affixed to its permanent site is a taxable sale of tangible personal property
if sold to a person responsible for affixing the structure to real
property.
(5) Structures
deemed to be tangible personal property. A sale of a structure that is affixed
to real property is nonetheless a taxable sale of tangible personal property if
the purchaser is obligated to remove the structure from its site.
(6) Tangible personal property affixed to
real property. An "in-place" sale of items such as fixtures, machinery, and
equipment is considered a sale of tangible personal property if the seller:
(A) is a lessee of the real property or
structure to which the items are affixed; and
(B) has the present right to remove the items
either as trade fixtures or under the express terms of the lease. Sales tax is
due on that portion of the total consideration allocable to the in-place items
without regard to the fact of their physical attachment to real
property.
(c)
Application of limited sales and use tax to manufactured homes.
(1) Limited sales or use tax is due on parts
or accessories installed in a manufactured home by the retailer of the
manufactured home, whether the home is sold alone or as part of a contract for
the improvement to realty. See §
3.291 of this title.
(A) If the retailer sells the home for a lump
sum amount that includes both the home and parts, the retailer should not
collect limited sales or use tax on the lump sum charge. The retailer must pay
limited sales or use tax on the parts at the time of purchase.
(B) If the retailer separates the charge to
the customer into one charge for the home and a separate charge for the
additional parts, the retailer must collect limited sales or use tax on the
amount charged for the parts. The retailer may issue a resale certificate in
lieu of tax when purchasing the parts.
(C) If a third party sells and installs the
items, the installer's sales tax responsibilities are determined by whether the
contract separates charges for materials from charges for labor. If the
installer charges a lump-sum amount for materials and labor, the installer
should not collect tax on the lump-sum charge, and the installer must pay
limited sales or use tax on the parts at the time of purchase. If the installer
separately states the charges for materials and labor, the installer must
collect limited sales tax on the amount charged for the parts, and the
installer may issue a resale certificate in lieu of tax when purchasing the
parts.
(2) A
manufactured home affixed to real property, including placement on a foundation
and/or supporting, blocking, leveling, securing, anchoring, and connecting
multiple sections, is presumed to be an improvement to real property for sales
and use tax purposes.
(3) Repair,
remodeling, restoration and maintenance.
(A)
Sales or use tax is not due on labor for the repair, remodeling, restoration,
and maintenance of a manufactured home affixed to real property and used for
residential purposes pursuant to §
3.291 of this title. Residential
use of a manufactured home occurs when the building is occupied as a home or
residence by the owner or by a tenant who occupies the building under a
contract for an express initial term of more than 29 consecutive days. Absent a
contract, only the period exceeding 29 consecutive days will be considered
residential use, when supported by valid documentation, such as receipts or
canceled checks.
(B) Sales or use
tax is due on the repair, remodeling, and restoration of a manufactured home
affixed to real property and used for nonresidential purposes pursuant to
§
3.357 of this title (relating to
Nonresidential Real Property Repair, Remodeling, and Restoration; Real Property
Maintenance).
(C) Sales or use tax
is due on the repair, remodeling, restoration, and maintenance of a
manufactured home temporarily affixed to real property pursuant to §
3.292 of this title (relating to
the Repair, Remodeling, Maintenance, and Restoration of Tangible Personal
Property). A manufactured home temporarily affixed to real property is deemed
to be tangible personal property if the owner of the home is a lessee of the
real property to which the home is affixed and is obligated to remove the home
from the real property under the express terms of the lease without regard to
the home's attachment to the real property. For example, a manufactured home
used exclusively to provide sleeping accommodations for employees, contractors,
or other workers at a construction site is temporarily affixed to the real
property.
Notes
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