New York Codes, Rules and Regulations › Title 20 - DEPARTMENT OF TAXATION AND FINANCE › Chapter IV - Sales And Use And Other Miscellaneous Taxes › Subchapter A - Sales And Use Taxes › Part 544 - Mobile Homes And Factory Manufactured Homes › Section 544.3 - Sales of mobile homes and factory manufactured homes

Current through Register Vol. 46, No. 28, July 10, 2024
Tax Law, §§ 1101 (b)(4)(i), 1105(a), 1111(f),
					 1115(a)(23)
(a)
Sales of mobile
				  homes.
(1) Sales of new mobile homes by
				  manufacturers to dealers, and sales to contractors, subcontractors or repairmen
				  who in such capacity install a mobile home on real property are not subject to
				  tax provided the purchaser presents a properly completed resale certificate,
				  where the purchaser is a dealer, or a properly completed contractor exempt
				  purchase certificate, where the purchaser is a contractor, subcontractor or
				  repairman.
(2) The retail sales tax
				  imposed under section 1105 (a)  of the Tax Law and
				  the compensating use tax imposed under section 1110  of the Tax Law, with respect to new
				  mobile homes, is computed on 70 percent of the receipts or consideration given
				  by the purchaser or user. The dealer, or contractor, subcontractor or repairman
				  selling a new mobile home must collect the retail sales tax from the purchaser.
(i) The "70 percent rule" applies only to the
				  selling price allocable to a new mobile home including any tangible personal
				  property, permanently incorporated as component parts by the manufacturer, and
				  is not applicable to furniture, fixtures, furnishings, appliances, attachments
				  or similar tangible personal property not permanently incorporated as component
				  parts of the mobile home at the time of manufacture.
(ii) Items of tangible personal property
				  included in a mobile home by a manufacturer or dealer which are not permanently
				  incorporated as component parts, such as furniture, draperies and freestanding
				  appliances, are taxable to the purchaser at 100 percent of their selling price.
Any invoice given to the purchaser must separately list
					 each item of tangible personal property (not permanently incorporated as a
					 component part at the time of manufacture) sold with the mobile home along with
					 its applicable selling price. A copy should be retained by the dealer for his
					 records.
Example 1:
A customer purchased a new mobile home from a dealer in a 7
					 percent taxing jurisdiction. The mobile home contained tangible personal
					 property permanently incorporated as component parts by the manufacturer such
					 as a water heater, a furnace, sinks, cabinets, and counter tops. The unit also
					 contained a range, an oven, a refrigerator, a dishwasher and other furnishings
					 which were not incorporated as component parts at the time of manufacture and
					 are thus taxed as tangible personal property.
The invoice given to the customer showed:
A total retail price of $25,000 for mobile home
								including separately listed items of tangible personal property totaling
								$5,000
Portion of total selling price to which
								the 70 percent rule is applied:
Total retail price of mobile home
$25,000
Less: Price of items of tangible personal
								property
-$ 5,000
Portion of selling price to which the 70 percent rule
								applies
$20,000
Computation of taxable portion of retail
								selling price of mobile home (excluding items of tangible personal
								property):
Portion of retail selling price to which the "70
								percent rule" applies
$20,000
Multiply by 70 percent
× .70
Taxable portion of retail selling price (excluding
								items of tangible personal property)
$14,000
Computation of tax on taxable portion of
								mobile home (excluding items of tangible personal property):
Taxable portion of retail selling price per
								above
$14,000
Multiply by tax rate of 7 percent
× .07
Tax on taxable portion of mobile home (excluding
								items of tangible personal property)
$980
Computation of tax on items of tangible
								personal property:
Price of the tangible personal property
$5,000
Multiply by tax rate of 7 percent
× .07
Tax on the tangible personal property
$ 350
Computation of total tax on mobile
								home:
Tax on taxable portion of mobile home (excluding
								items of tangible personal property, plus
$ 980
Tax on the tangible personal property
+ 350
Total tax on mobile home
$1,330
(3) When a mobile home is accepted in trade
				  as a part payment on a new mobile home, the reduction in the amount of the
				  receipt subject to tax attributable to the trade-in must first be applied to
				  the total selling price of the new mobile home including all items of tangible
				  personal property. The amount remaining is then apportioned between (i) the
				  price of the new mobile home excluding the tangible personal property not
				  permanently incorporated as a component part, and (ii) the selling price of
				  such tangible personal property not incorporated as a component part of the
				  mobile home, in the same proportion each such price bears to the total selling
				  price.
Cross-reference:
See section
					 526.5(f) 
					 with respect to property accepted in trade.
Example 2:
Assume, as in example 1 a new mobile home is sold for
					 $25,000 (including separately listed items of tangible personal property
					 totaling $5,000), except that the purchaser was given a trade-in allowance of
					 $5,200.
The portion that each element of
								the selling price is to the total selling price is computed as
								follows:
Amount
Percent of Total
Selling price excluding tangible
$20,000
personal property
÷
Divide by total selling price
$25,000 × 100% =
80%
Selling price of items of
$5,000
tangible personal property
÷
$25,000 × 100% =
20%
Total
100%
The amount of trade-in attributable
								to each element of the total selling price is then computed as
								follows:
Element of Total Selling Price
Percent of Each Element to Total
Trade-in Amount
Proportion of Trade-in Attributable to Each
								Element
Selling price excluding tangible personal
								property
80% ×
$5,200 =
$4,160
Items of tangible personal property
20% ×
$5,200 =
$1,040
Total
100%
$5,200
The taxable portion of the selling price
								of the mobile home excluding tangible personal property not permanently
								incorporated as a component part at the time of manufacture is then
								computed:
Amount
Total retail price of mobile home
$25,000
Less: Price of tangible personal
								property
-$ 5,000
Price excluding tangible personal
								property
$20,000
Less: Proportionate amount of
								trade-in
-$ 4,160
Portion of total selling price to which
								the "70 percent rule" applies
$15,840
Portion taxable and tax due thereon is
								then determined:
Portion taxable
$15,840 × 70 =
$11,088
Multiply by tax rate
×.07
Applicable tax
$776.16
Items of tangible personal property
$5,000
Less: Proportionate trade-in amount
$1,040
Net
$3,960
Multiply by applicable tax rate
.07
$277.20
Total tax due
$1,053.36
(4)
				  The sale of a used mobile home is exempt from the sales and compensating use
				  tax. Items of tangible personal property included in the sale and which were
				  not permanently incorporated as a component part of the mobile home at the time
				  of manufacture are subject to the sales and compensating use tax.