Gas Piping & Miscellaneous Contractor Tax Treatment Questions
- Wrapping a gas line going into a house.
Wrapping a gas line going into a residential facility is a nontaxable real property construction activity. The contractor’s charge to the customer is not taxable. Purchases of materials by the contractor are subject to sales/use tax.
- Thawing frozen pipes.
Thawing frozen water pipes in a residential facility is a nontaxable real property construction activity. The charge for labor and any materials is not subject to sales tax.
Thawing of frozen pipes in a commercial facility may be subject to sales tax depending upon if the pipes being serviced primarily (more than 50%) serve a building or a process function. This is something to note in your work activity.
- Installing a water line to a refrigerator.
Installation or repair of a water line to the faucet or shut off valve for a fixture connection (e.g., refrigerator, washing machine) is a nontaxable real property construction activity. This includes the faucet/shut off valve. If there is no valve, the water line is real property up to where it connects to the fixture.
The tubing from the fixture to the faucet or shut off valve is personal property for install and repair.
- Changing thermostat batteries.
Service to a wall-mounted thermostat is a nontaxable real property repair, including replacing batteries. The contractor must pay tax on its purchase of batteries replaced during such repair.
- Running a gas line to a swimming pool.
Above ground piping to a swimming pool is tangible personal property for installation and repair purposes.
Underground piping is real property for installation and repair purposes.
- Running a gas line for an outdoor grill.
Installation and repair of a gas line for an outdoor grill at a residential facility is a nontaxable real property construction activity.
- Running a gas line to a dryer or stove.
Installation and repair of a gas line for a dryer or stove in a residential facility is a nontaxable real property construction activity.
The tubing or piping that connects the appliance to the gas line connection is taxable personal property for installation and repair purposes.
- Repairing a gas line that goes to a pool or appliance.
Installation and repair of a gas line for a dryer or stove in a residential facility is a nontaxable real property construction activity.
The tubing or piping that connects the appliance to the gas line connection is taxable personal property for installation and repair purposes.
Above ground piping to a swimming pool is tangible personal property for installation and repair purposes.
Underground piping is real property for installation and repair purposes.
- Installing a dryer vent through the wall.
Installing a dryer vent through the wall is a nontaxable real property construction activity.
Connecting flex tubing to an existing wall vent is a taxable service to tangible personal property.
- Replacing a vent for a water heater.
Repair and service to a water heater is a service to tangible personal property and is taxable.
- Repair a pressure tank.
The installation, repair or replacement of a pressure tank for a residential facility is not subject to sales tax.
- Repair well pump pipes.
The installation, repair or replacement of well pump piping are nontaxable real property construction activities.
Note: If the repair is to a pump, the charge is taxable.
- Repair water lines to a boiler.
The installation, repair or replacement of water lines to a boiler are nontaxable real property construction activities.
Note: If the repair is to the boiler, the charge is taxable.
- Change baseboards for a boiler.
The installation and complete replacement of baseboards for a boiler system are nontaxable real property construction activities.
- Changing water filters for a reverse osmosis system.
The charge to replace the filters in a reverse osmosis system in a commercial or a residential facility is taxable, unless an exemption applies. The repair (e.g., replacement of the filter) of water softeners, water conditioners, and appliances (e.g., refrigerator, ice maker) are services to tangible personal property.
- Replacing a shower faucet “trim” (the handle, shower head, tub spout but not the valve behind the wall).
The complete replacement of a faucet in a bathroom is a nontaxable real property construction activity. Complete replacement would include items that normally come in the box for installation.
A repair of a bathroom faucet is a taxable service to tangible personal property. An example of a repair would be replacing only the faucet’s cartridge.
The repair or replacement of the shower valve is a nontaxable real property construction activity. (The valve is generally not sold as part of the faucet.)
- If a church is exempt, is the parsonage (house) they own also exempt?
Yes, if the church is the customer (invoice made out in the name of the church and payment made by the church) and the church provides a fully completed exemption certificate including its Certificate of Exempt Status number, the charges for the work completed on the parsonage it owns is also exempt.
- If a farmer is exempt, are repairs done in the bar exempt?
Farmers are not exempt entities; however, there are several farming exemptions that may apply to a farmer’s purchases or services. You are relieved of liability to remit sales tax if you receive a fully completed exemption certificate from the farmer within 90 days of the sale. See Wisconsin Department of Revenue Publication 221, Farm Suppliers and Farmers, for more information about possible farming exemptions that may apply.
Contact Holly Hoffman of the Sales Tax Advisory Network, LLC at holly@salestaxlady.com for more information.