- Texas has ruled that an equipment dealer is a marketplace provider for separate warranty sales.
- The ruling applies to a company that offers a customer value agreement (CVA) as a warranty for new, used, and aftermarket purchases of equipment.
- The CVA is a separate line item on the equipment purchase invoice and is a contractual agreement between the taxpayer and the equipment customer.
- The dealer is required to perform repairs covered by the CVA.
- The ruling concluded that the CVA qualifies as an “extended warranty or service policy,” which is subject to sales tax.
- Since the sale of the CVA is taxable, the ruling determined that the dealer is a marketplace provider.
Source: aprio.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
