Instructions For Sales Tax Refunds (Page 3 of 4) in pdf

Refunds

Bad Debts

For a bad debt, you can take a credit or request a refund from this agency in the period when the sale is reflected

on your financial books and records as a bad debt. The refund claim will be invalid unless this amount is or will be

written off for income tax purposes. When requesting a refund, send a letter explaining the basis of the refund

request and include a copy of your general ledger indicating this invoice has been written off as bad debt and a

copy of the invoice. See

Rule 3.302(d)

for more information.

Length of Time to File A Refund

A valid refund request must be postmarked within four years from the date on which the tax was due and payable

as defined in Tax Code, §151.401.

Electricity

To request a refund of sales tax paid on electricity used in an apartment complex's common area, a non-

permitted taxpayer should follow the instructions for the refund claim form (00-985) and list the specific areas,

such as laundry room, fitness center and hallways that use the electricity. Permitted taxpayers may take a credit

on a sales tax return, request a refund from the electric utility provider or submit a refund claim to the

Comptroller's office. Taxpayers may not receive a full refund if a city to which the tax was paid repealed the

exemption for residential use of electricity. See

Rule 3.295

for more information concerning natural gas and

electricity exemptions.

Timber Production

There is a phased-in refund or credit for certain items purchased, leased, or rented in commercial timber

production on or after October 1, 2001. Effective January 1, 2008, timber items will be fully exempt from state

and local sales taxes.

The percentage of the refund or credit is determined by the date of purchase.

A timber company may claim a credit or refund of 33 percent of state and local sales or use tax paid on

●

eligible items bought between October 1, 2001, and December 31, 2003.

The refund or credit increases to 50 percent for purchases made from January 1, 2004, to December 31,

●

2005, and to

75 percent for purchases in the period January 1, 2006, through December 31, 2007.

●

Effective January 1, 2008, timber items are fully exempt from state and local sales taxes.

●

See

Rule 3.367

or the

Sales Tax Update - November 2001

for additional information.

Exempt Organizations

An exempt organization (non-permitted) should follow the instructions on the refund claim form (00-985) and

include a copy of their letter of exemption from the Comptroller's office. If you are not registered as an exempt

organization, please refer to our

Web page

for more information. Permitted taxpayers may take a credit on a

sales tax return, request a refund from the telephone service provider or submit a refund claim to the

Comptroller's office.

Manufacturers

(3 of 4) [4/21/2010 1:07:10 PM]

Instructions For Sales Tax Refunds Page 3

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