Fabrication Labor

The sales and use tax applies to charges for the fabrication or assembly of tangible personal property by special order. Fabrication or assembly labor charges are taxable even if the customer provides the materials. For this reason, the charges for bringing a new item to its finished state are taxable. A "new item" means new insofar as the ultimate consumer is concerned. The creation of a new item includes the assembly of a piece of property for the first time but does not include charges for the reassembly of an item disassembled for shipping purposes.

On the other hand, charges for repairing or restoring an existing item of tangible personal property to its original condition are not subject to tax. A charge for reconfiguring or enhancing existing tangible personal property, unless it results in the creation of a new and different item of tangible personal property, is also not taxable.

Fabrication Labor Information

Fabrication Labor Charges

Installation Labor