Form Pub. Ks-1527 - Kansas Business Tax For Political Subdivisons Page 40
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42INSTRUCTIONS FOR COMPLETING FORM ST-28B
When gas, water, or electricity is furnished through one meter
processes. The following uses of electricity, gas, or water are
for both taxable and exempt purposes, the purchaser is
not exempt from sales tax: shipping, repairing, servicing,
responsible for determining the percentage of use exempt from
maintaining, cleaning the equipment and the physical plant, and
sales tax. The sample worksheet provided below will help you
storing.
to determine the percent of electricity, gas, or water that qualifies
INGREDIENT OR COMPONENT PART: An example of
for exemption. If you have questions about this form, contact
electricity, gas, or water which becomes an ingredient or
our Taxpayer Assistance Center, Kansas Department of
component part and qualifies for exemption is “water” that is
st
Revenue, 915 SW Harrison St., 1
Floor, Topeka, KS, 66625
part of the ingredient in a beverage which is bottled and sold to
0001, or call (785) 368-8222.
a retailer for resale.
AGRICULTURAL: Electricity and gas for agricultural use is
RESIDENTIAL: If the electricity, gas, or water you consume is
exempt from the state sales tax but not exempt from the local
for residential use only, you do not need to file this form. The
taxes. Agricultural use does not include commercial operations
utility company automatically exempts you from paying state
such as processing food or dairy products, off-farm grain storage
sales tax (city and county sales tax still applies). However, if
and marketing, lumbering, or use by a stockyard, slaughter
the electricity, gas, or water you consume is partly for residential
house, floral shop, or turf farm.
purposes and partly for commercial use, you must determine
CERTAIN NONPROFIT CORPORATIONS: Sales of electricity,
the percent of usage that is residential and file copies of your
gas, or water to properties which are exempt from property
worksheets and this completed form with your utility company
taxation under K.S.A. 79-201b Second through Sixth are exempt
and the Department of Revenue. Utilities consumed in
from state and local sales tax. Once the property is determined
commercial common areas such as an office, lounge, hallway,
to be exempt, copies of the “order” from the Board of Tax Appeals
laundry facility, storage area, swimming pool, etc., do not qualify
and this completed exemption certificate (ST-28B) must be
for exemption.
provided to the utility company and the Kansas Department of
HOW MUCH OF MY UTILITY USE QUALIFIES FOR
Revenue.
EXEMPTION? You will probably need several sheets of paper
CONSUMABLES: The portion of electricity, gas, or water you
as worksheets. If your facility is serviced by more than one
use that meets the following requirements is exempt from state
meter, you need to complete a separate chart to determine the
and local taxes: 1) essential or necessary to the process; 2)
percent of usage for each meter. If the facility is heated and
used in the actual process at the location during the production
air-conditioned by a central unit, you may use the square footage
activity; 3) immediately consumed or dissipated in the process;
method to arrive at the residential percent of consumption for
and, 4) used in the production, manufacturing, processing,
heating and cooling. You may need the assistance of a plumber
mining, drilling, refining, or compounding of tangible personal
or electrician to complete the formulas. Refer to the following
property or the treatment of by-products or wastes of any above
example and steps to determine your exempt percent.
COLUMN 1
COLUMN 2
COLUMN 3
COLUMN 4
COLUMN 5
COLUMN 6
Estimated
Number of Days
Usage Per Year
����
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�����
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Rating of
Hours of
the Device is
stated in kWh,
Type of Device
Device
Use Per Day
Load Factor
Used Per Year
BTU, or Gallons
20 - light bulbs
T
40 watts
10
1.00
324
2,592 kWh
1 - production machinery
E
500 watts
10
.50
255
637.5 kWh
1. At the top of each page, place the headers as noted in the
2. Indicate beside each type of device an “E” for exempt or a “T”
example and complete the following information per column:
for taxable.
COLUMN 1—List each device that is pulling the utility.
3. Multiply the quantity in column 1 by column 2 by column 3 by
COLUMN 2—Rating of each device.
column 4 by column 5 to arrive at the sum for column 6.
COLUMN 3—Estimate the number of hours of use per day
(i.e., on average, twenty 40 watt light bulbs are on ten
4. Add the usage per year (column 6) for all of the devices you
hours per day, therefore, enter “10”).
have indicated as “exempt” then add all of the usage per
COLUMN 4—Determine and enter load factor (i.e., when a
year (column 6) for all the devices that you have indicated as
light bulb is on it pulls the full rate of 100% power but a
being “taxable.” Adding the exempt and taxable usage should
burner on the stove on “low” may only pull 30% load factor).
equal the total consumption per year as shown on your utility
COLUMN 5—Number of days the device is used per year.
bills for the last 12 months.
COLUMN 6—Determine usage per year stated in kilowatt-
hours (kWh), BTU, or gallons.
5. Divide the total number of exempt kWh by the total number
1000 watts = 1 kWh
of kWh consumed in the last 12 months. This is the percent
Horsepower = .746 X H.P. = watts
of usage that is exempt from tax. Enter this amount on line 5
Ten 100-watt bulbs burning 1 hour will use 1 kWh
on the front of this form (ST-28B).
1,000,000 BTU in 1 MCF
The instructions provided are intended to help consumers of electricity, gas, or water complete this form.
In case of discrepancies, the applicable law prevails.
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