SALT Report 3526 – The New York State Department of Taxation and Finance has released a memorandum regarding policy changes on storage and transit services provided in conjunction with an exempt transportation services. In the State of New York transportation of tangible personal property is generally exempt from state and local sales tax while the storage of tangible personal property is generally not exempt, and therefore subject to state and local sales tax. Incidental storage of tangible personal property is commonly referred to as “storage in transit”. Storage in transit typically occurs when events delay the delivery or when the stored property is the responsibility of the mover.
The revision to this policy recognizes that storage in transit can be incidental to the provision of an exempt transportation service. Therefore storage in transit is not taxable if the following criteria is met:
- The mover is providing its customer a transportation service. That is, the mover provides its customer with a bill of lading specifying a destination address that is:
- different from the address where the mover picks up the property to be moved, and
- different from the location where the mover would provide storage.
- The mover is responsible to the customer for any loss or damage to the property during the storage-in-transit period.
- The mover remains responsible, during the storage-in-transit period, to complete the moving process.
- Any charge for storage in transit made or identified prior to the commencement of the transportation service does not exceed the amount of the charge for the transportation
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