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New York Extends Exemption to Certain Medical Equipment, Services


 Soon to be exempt in New York State.

Beginning July 1, 2014, a sales tax exemption is being extended to certain medical equipment and services that are currently subject to New York sales tax.

According to the New York State Department of Taxation and Finance, when medical equipment and supplies are “primarily and customarily used for medical purposes” and are not “generally useful in the absence of illness, injury, or physical incapacity,” they should be exempt from sales tax.

Thus starting July 2014, the following items will qualify as exempt medical equipment when purchased and used for medical purposes:

  • Bath chairs and seats;
  • Bath safety grab bars, handles, and rails;
  • Over-bed tables;
  • Prefabricated wheelchair ramps; and
  • Wheelchair trays.

The exception

The above items are not exempt from New York sales tax when purchased by paid providers of medical services that are not part of an approved sales tax exempt organization.

Prosthetic aids

Sales of prosthetic aids are always exempt from sales tax, even when purchased by paid providers of medical services. Prosthetic aids are not generally useful in the absence of illness, injury, or physical incapacity.

The NY Tax Department has determined that power lift chairs will qualify as prosthetic aids, beginning July 1, 2014. Likewise, component or replacement parts for medical equipment and prosthetic aids will also be exempt from sales tax.

However, “component or replacement parts sold to doctors and other paid providers of medical services that are not an approved sales tax exempt organization” are taxable.

Services to medical equipment and prosthetic aids

Effective July 1, 2014, services of “installing, maintaining, servicing and repairing exempt medical equipment and component parts of medical equipment are exempt from sales tax.”

However, such services performed for doctors and other paid providers are taxable (unless the paid providers are part of an approved sales tax exempt organization).

Type of payment

The type of payment used (personal insurance, employer-sponsored insurance, Medicaid or Medicare) does not impact the taxability of an item.

Sales tax rates, rules and regulations change, as do sales tax exemptions. Be prepared. Learn how an automated solution works.

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Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.