Tax Type
Retail Sales and Use Tax
Description
Real property vs. tangible personal property; Contractors and nurserymen
Topic
Taxability of Persons and Transactions
Date Issued
09-11-1989
September 11, 1989
Re: Ruling Request/Sales and Use Tax
Dear ******************
This is in reply to your letter of August 16, 1989 in which you request clarification regarding the differentiation between real and tangible personal property for Virginia sales and use tax purposes.
The department does not publish any type of list which differentiates real property from tangible personal after installation. However, I have enclosed §630-10-27 and §630-10-40 of the Virginia Retail Sales and Use Tax Regulations which deal with contractors and nurserymen.
As a general rule, any person in Virginia who installs tangible personal property which becomes permanently affixed to real estate, would be considered a contractor with respect to real estate. The exception to this would be a retailer who sells and installs fences, venetian blinds, window shades, awnings, storm windows and doors, floor coverings, cabinets, kitchen equipment, window air conditioning units and other like or comparable items (see subsection G of Regulation§630-10-27). Regulation §630-10-40 sets forth a further exception relating to nurseryman and landscape contractors.
I have also enclosed a copy of the Virginia Supreme Court decision in Transcontinental Gas Pipe Line Corporation v. Prince William County, 210 Va. 550 (1970). This decision sets forth the primary tests for determining whether property is tangible or real.
If you should have any further questions, please feel free to contact the department.
Sincerely,
W. H. Forst
Tax Commissioner
Rulings of the Tax Commissioner