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Q:  What types of purchases qualify for the replacement parts for farm machinery and equipment sales tax exemption?

A: 

For July 1, 2006 through July 21, 2007, exempt purchases included:

  • Parts that replace an existing part, or which are essential to maintain the working condition, of a piece of qualifying farm machinery and equipment; and
  • An itemized charge for replacement parts included in a charge by the seller for the repair, cleaning, alteration, or improvement of qualifying farm machinery and equipment, but only when the itemized charge does not exceed the seller’s current retail selling price of the part or the seller’s cost of the part.

Beginning July 22, 2007, the exemption for replacement parts for qualifying farm machinery and equipment includes the purchase of:

  • Parts that replace an existing part, or which are essential to maintain the working condition, of a piece of qualifying farm machinery and equipment;
  • Installation of replacement parts for qualifying farm machinery and equipment; and
  • The entire charge for repairing qualifying farm machinery and equipment.

 

If exempt installation or repair services are provided in a single transaction that also involves the provision of nonexempt services, the exemption applies to the exempt services as long as the charge for the exempt services are separately itemized and do not exceed the seller's usual and customary charge for such services.  The exemption does not apply if the seller makes a single non-itemized charge for all of the services.
More information
Special Notice: Replacements Parts for Farm Machinery and Equipment - Sales and Use Tax Exemption (pdf)
Agriculture guide
Related questions & answers
Are custom farmers eligible for the replace parts for farm machinery and equipment exemption?
Who is eligible for the "replacement parts for farm machinery and equipment sales tax exemption?"
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