Sales And Use Tax Information For Motor Vehicle Sales, Leases, And Repairs - State Of Wisconsin Page 40
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49Publication 202
parts used to perform repair services under a warranty is not
for repairs by the other person is exempt as a sale for resale
subject to Wisconsin sales or use tax.
whether or not the original sale of the property to which the
warranty or insurance plan relates occurred in Wisconsin. The
Example: Customer B purchased a television with an extended warranty
sales and use tax treatment of the charge by the retailer to the
from an appliance store. Customer B has the television repaired under the war-
customer or plan provider is the same as provided in subs. (4)
ranty. The appliance store is reimbursed $200 by the warranty company for the
and (5).
repair of the television. The $200 reimbursement is not subject to Wisconsin
sales or use tax.
Note: Refer to s. Tax 11.14 for information regarding exemption certifi-
cates, including resale certificates.
(c)1. A retailer who provides parts or performs taxable re-
pair services to tangible personal property under a warranty
(7)
GOODWILL WORK. A retailer who provides free
may purchase the tangible personal property transferred to the
parts or services or both to a customer under an implied war-
customer as part of the repair without Wisconsin sales or use
ranty in order to maintain good customer relations, although not
tax as property for resale.
required to do so under a sales agreement, maintenance agree-
ment, express warranty, or insurance plan may purchase the
2.
A person who provides tangible personal property in
parts without Wisconsin sales or use tax as property for resale.
repairing real property under a warranty is the consumer of tan-
gible personal property transferred to a customer as part of the
Example: Customer Z, a resident of Wisconsin, purchased an automobile
repair to real property and is subject to Wisconsin sales or use
and extended warranty from a Wisconsin dealership. The dealership charged
tax on the purchase of the tangible personal property trans-
Wisconsin sales tax on the sale of the automobile and warranty. Customer Z
brought the vehicle to the dealership for repairs that were covered under the
ferred.
warranty. While performing the repairs, a part is damaged. The dealership, who
is not required by the terms of the warranty to provide the part, provides the part
Note: Refer to s. Tax 11.68 for information about distinguishing between
free of charge to Customer Z. The dealership may purchase the part provided
real and tangible personal property.
free to Customer Z without Wisconsin sales or use tax as property for resale.
(6)
REPAIRS NOT BY RETAILERS. If a retailer does
Note: The interpretations in s. Tax 11.27 are effective under the general
not repair tangible personal property under a warranty or insur-
sales and use tax law on and after September 1, 1969, except that the definitions
in sub (1) and the provisions in subs. (4)(b)2 and (5)(c)2 became effective on
ance plan, but instead has another person perform the repairs
February 1, 1994.
covered under the warranty or insurance plan, the person’s
gross receipts from the sale of the repair to the retailer are not
History: Cr. Register, November, 1977, No. 263, eff. 12-1-77; am. (1), (2)
subject to Wisconsin sales or use tax provided the retailer gives
(a) and (b), Register, September, 1984, No. 345, eff. 10-1-84; am. (2)(c), Reg-
the person a properly completed resale certificate. The charge
ister, July 1987, No. 379, eff. 8-1-87; r. and recr., Register, January 1994, No.
457, eff. 2-1-94
38
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