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Burial Vaults in Missouri

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It has long been said that death and taxes are the only true certainties. In a recent letter ruling, Missouri combined the two certainties into one, by taking the position that burial vaults are subject to Missouri sales tax. While the ruling seems correct and somewhat obvious, it highlights the confusing aspects of sales tax rules dealing with real vs tangible property, fixtures, and who is on the hook for state sales and use tax.


As a starting point, a letter ruling request is a tool that can be used by a taxpayer to determine the taxability of a transaction from a state’s point of view. Despite often looking at a transaction through the lens of taxability, a taxpayer can at least look at the state’s thought process to better understand whether a particular item or transaction is subject to sales tax. Further, the letter ruling can often be challenged through the administrative appeal process if the taxpayer disagrees with its findings.

In most states, a taxpayer can anonymously inquire as to whether a particular transaction is subject to sales tax. Because an anonymous ruling is not binding on the department of revenue or state agency or the taxpayer, it can serve as a feeler to determine how the agency might rule.

Most states also offer a formal letter ruling, in which the taxpayer must disclose its name and supporting documentation surrounding the subject transaction. The ruling is binding on the taxpayer and the agency for a period of time. Obtaining a binding ruling can serve as an insurance policy if the taxpayer is later audited so that the agency cannot later change its position.


In LR 8123, the funeral home inquired about the sales tax implications of its purchase of burial vaults. When a customer purchases a vault, the vault is ordered from a supplier, who delivers it to the cemetery on the day of the funeral. As part of the purchase, the Vault company installs the 3,000-pound vault into the ground and later covers it in dirt.

The funeral home first asked whether the vault was subject to tax. The Missouri Department of Revenue concisely responded that the vault is tangible personal property and upon its transfer is subject to Missouri sales and use tax.

But who should be paying the tax? The funeral home who purchased the vault? Or the consumer who purchased the installed vault from the funeral home?

Generally, the final purchaser of tangible personal property is liable for the sales tax. However, if the purchaser contracts for a real property improvement or fixture, the installer is considered the last person to own the property in its tangible state, and therefore, is liable for the sales or use tax.

With that predicate in mind, the Missouri Department of Revenue determined the customer contracted with the funeral home for an installed vault. And, because the vault was a real estate fixture, the customer was buying improved real property, not tangible personal property. Resultingly, the funeral home was considered the contractor for sales and use tax purposes and the last one to own the vaults in its tangible state. Therefore, the funeral home is required to pay sales tax on the purchase of its vaults.


The recent Missouri ruling highlights how the simple rules of state sales and use tax can get convoluted depending on the nature of the transaction. If you or your client provide the installation of property into land and/or buildings, they could be liable for the sales tax. Additionally, the recent ruling serves as a reminder that a letter ruling can be a valuable tool in the sales and use tax practitioners belt.

If you have questions or need advice on how sales tax applies to your business, contact us, and get advice from a state sales tax expert.

At Sales Tax Helper, not only do we represent companies during state sales tax audits and appeals, but we also provide important consulting services for you or your client’s businesses to prevent the audit in the first place. Schedule a free consultation here.

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