Overall, this is another service provider that could have used competent counsel. The idea that they could not produce evidence that a customer was connected to a waterline is such a tiny hurdle to stumble on. Public records of water meters exist. Part of the problem is just knowing what is needed and where to find it is a skill in and of itself.
The taxpayer bringing up that he feels the Comptroller is inconsistent in it's determinations for grease traps and venthoods are inconsistent, I do feel as well, doesn't win a hearing.
202503029H
SOAH DOCKET NO. 304-25-03416
CPA HEARING NO. 118,727
RE: **************
TAXPAYER NO: **************
AUDIT OFFICE: **************
AUDIT PERIOD: September 1, 2016 THROUGH March 31, 2020
Sales And Use Tax/RDT
BEFORE THE COMPTROLLER OF PUBLIC ACCOUNTS
OF THE STATE OF TEXAS
GLENN HEGAR
Texas Comptroller of Public Accounts
HEITH TREADWELL
Representing Respondent
INDIVIDUAL A
Representing Petitioner
COMPTROLLER’S DECISION
This decision is considered final on April 22, 2025, unless a motion for rehearing is timely filed; this date of finality is calculated based on the Administrative Procedure Act (APA).[1] The failure to timely file a motion for rehearing may result in adverse legal consequences.
Administrative Law Judge (ALJ) Kathy Pickup of the State Office of Administrative Hearings (SOAH) issued a Proposal for Decision (PFD) that includes Findings of Fact and Conclusions of Law. SOAH served the PFD on each party and each party was given an opportunity to file exceptions and replies with SOAH in accordance with SOAH’s rules of procedure. The ALJ recommended that the Comptroller adopt the PFD as written.
After review and consideration, IT IS ORDERED that the PFD is adopted as changed.[2]
The result from this Decision is Attachment A. The ALJ’s recommendation letter is Attachment B. The PFD as changed is Attachment C. Attachments A, B, and C are incorporated by reference.
Attachment A reflects a liability.[3]
The total sum of the tax, penalty, and interest is due and payable 20 days after a comptroller’s decision becomes final.[4] If such sum is not timely paid, an additional penalty of 10 percent of the taxes due will accrue.
SIGNED on this 28th day of March 2025
GLENN HEGAR
Comptroller of Public Accounts
By: Lisa Craven
Deputy Comptroller
Attachment A, Texas Notification of Hearing Results
Attachment B, ALJ’s recommendation letter
Attachment C, Proposal for Decision as changed
ATTACHMENT C
SOAH Docket No. 304-25-03416
Before the State Office of Administrative Hearings
TCPA Hearing No. 118,727
Proposal for Decision
************** (Petitioner) was audited by the Tax Division (Staff) of the Texas Comptroller of Public Accounts (Comptroller) for sales and use tax compliance and assessed tax, a 10% penalty on tax collected but not remitted, and interest. All other penalty was waived. Petitioner does not contest that the vent hoods are improvements to real property or that its vent hood cleaning services are performed on real property, but contends that its services qualify as nontaxable periodic and scheduled real property maintenance as defined in Texas Administrative Code § 3.357(a)(7), and that its grease trap services qualify as repair, remodeling, maintenance, and restoration of tangible personal property (TPP) as defined by Texas Administrative Code § 3.292, and are not a real property service as defined by Texas Administrative Code § 3.356. Petitioner also contends that the Comptroller has been inconsistent in his interpretation of vent hood maintenance, providing past rulings and guidance that conflicts with the determination that was delivered in Petitioner’s audit. Staff contends vent hood cleaning services are a taxable real property service, regardless of the frequency and regularity of its performance. In this Proposal for Decision, the Administrative Law Judge (ALJ) finds that the assessment should be affirmed except as agreed by Staff.
I. Notice, Jurisdiction, and Procedural History
Staff referred this case to the State Office of Administrative Hearings (SOAH) and, on November 4, 2024, ALJ Kathy Pickup issued an Order Scheduling the Hearing on the Merits and Setting Pre-Hearing Requirements, establishing the date, time, and location of the hearing. On November 5, 2024, Staff issued a Notice of Hearing to Petitioner. The Notice was amended on February 14, 2025, to include an additional contention as requested by Petitioner. Heith Treadwell represented Staff, and Petitioner was represented by its president, INDIVIDUAL A. The hearing convened on February 26, 2025, and the contested case record closed March 4, 2025, after the parties filed their respective exhibits offered and admitted at the hearing.
There are no issues of notice or jurisdiction; therefore, those matters are set out in the Findings of Fact and Conclusions of Law without further discussion.
II. Reasons for Decision
A. Evidence
Petitioner presented the testimony of INDIVIDUAL A, Petitioner’s president, and offered the following evidentiary exhibits:
Exhaust System Diagrams;
National Fire Protection Association (NFPA) Guidelines and International Fire Code Excerpts;
CITY Health Code Section 228.185;
American National Standard and American Society of Heating, Refrigerating, and Air- Conditioning Engineers (ASHRAE) Excerpts;
Safeguarding Against Commercial Kitchen Fires;
Microbial Corrosion Explained;
Description of Water Blasting;
TCEQ Standards;
CITY Water System Code of Ordinances; and
Photo of COMPANY Grease Trap.
Staff presented the testimony of auditor Michelle Olivas and offered the following evidentiary exhibits:
Hearing Request Receipt;
Texas Notification of Audit Results;
Penalty & Interest Waiver Worksheet;
Audit Report;
Audit Plan;
Independent Audit Review Report; and
Contested Items Spreadsheet.
The parties’ exhibits were admitted into evidence without objection.
B. Agreed Adjustments
Staff agreed to waive interest for the period of April 1, 2023, through March 31, 2024.
C. Material Facts and issues Presented
Petitioner provides various services, through vendors or sub-contractors, to food service, hospitality, and hospital customers. Petitioner’s website states vendors take care of the actual service that they specialize in, and Petitioner takes care of the management, logistics, and systems. Staff audited Petitioner for compliance with Texas sales and use tax law for the period September 1, 2016, through March 31, 2020. Petitioner provided sales journals, sales invoices, general ledgers, federal income tax returns, depreciation schedules, financial statements, and bank statements.
The auditor determined sales tax collected was greater than sales tax reported by reviewing Petitioner’s general ledger account and reconciling amounts reported to the State. Errors for tax collected but not remitted are scheduled in Exam 100. The auditor also assessed tax on nontaxed sales of kitchen vent hood cleaning and grease trap clearing, finding these were taxable real property services, and scheduled disallowed deductions in Exam 200. Credits were allowed for error tax collected from customers in which a credit memo acceptance form was received. Credits for tax refunded are scheduled in Exam 201. One asset was acquired during the audit period and the invoice for this asset was not provided. Adjustments for taxable purchases of assets are scheduled in Exam 300. Petitioner requested an Independent Audit Review (IAR), and a conference was held on October 30, 2020. On December 4, 2020, an IAR report was issued. The IAR considered all of Petitioner’s contentions and recommended no changes to the audit.
On February 1, 2021, Staff issued an audit report and Texas Notification of Audit Results assessing tax, penalty on tax collected but not remitted, and interest. After receiving the assessment, Petitioner requested a redetermination hearing. Staff did not agree to adjust the assessment and referred the matter to SOAH.
D. ALJ Analysis and Recommendation
Texas imposes a tax on each sale of a taxable item in this state. Tex. Tax Code § 151.051. The term taxable item includes tangible personal property and taxable services. Id. § 151.010. When tax is imposed on tangible personal property, the taxing entity’s prima facie burden of proof is easily met because, unless an exemption applies, all sales of tangible personal property in this state are taxable. See Comptroller’s Decision No. 116,506 (2020). However, only those services enumerated in Texas Tax Code § 151.0101 are subject to tax. Therefore, in a contested case hearing, Staff must establish, prima facie, not only that a service was sold but that the service is taxable. See, e.g., Comptroller’s Decision No. 102,386 (2014). Once Staff’s initial burden is met, Petitioner bears the burden to establish by a preponderance of the evidence that the service is not taxable, or by clear and convincing evidence that the service is exempt. 34 Tex. Admin. Code § 1.26(c), (e); see also Comptroller’s Decision No. 100,933 (2009).
Texas Tax Code § 151.0101(a)(5) includes the repair, remodeling, maintenance, and restoration of tangible personal property as a taxable service. In addition, taxable real property services are defined by statute to include building or grounds cleaning, janitorial, or custodial services. Tex. Tax Code §§ 151.0048(a)(4), .0101 (a)(11). Taxable real property services include activities of keeping the inside and outside premises of a building clean, orderly, and functional, including performing minor adjustments, maintenance, or repairs. 34 Tex. Admin. Code § 3.356(a)(7).
1. Vent Hoods
Vent hood cleaning services are considered taxable real property service. See, e.g., Comptroller’s Decision Nos. 118,260 (2025) [ENDNOTE 5], 42,854 (2004) (vent hood cleaning is a taxable building cleaning or janitorial service under Rule 3.356); see also State Tax Automated Research (STAR) Document Nos. 9110L1135D04 (October 10, 1991) and 9905450L (May 27, 1999). As stated in Comptroller’s Decision No. 42,854:
…in specifically responding to taxpayer inquiries concerning the proper tax treatment to be afforded cleaning of vent hoods, the Tax Policy Division has on more than one occasion, indeed has consistently, stated its unequivocal position that vent hood cleaning is a taxable building cleaning or janitorial service under Rule 3.356, not real property repair and restoration as defined in Rule 3.357. See e.g., Accessions [ENDNOTE 6] 9110L1135D04 (October 10, 1991) and 9905450L (May 27, 1999). Of significance is that Rule 3.356(a)(7) identifies chimney and duct cleaning as examples of taxable building cleaning, the requirements for and characteristics of which are identical to vent hood cleaning. Indeed, attachment to the building ductwork has been a basis for determining that vent hoods are improvements to realty.
The Decision goes on to state:
…the cleaning of vent hoods, like the specialized cleaning activities related to chemical plants, refineries and oil storage tanks, has been the subject of its own consistent tax treatment by the Tax Policy Division under Rule 3.356 since at least 1991 and nothing in Comptroller's Decision 34,644 (2002) indicates that such Decision represents any abandonment or overruling of that treatment. Moreover, nothing presented by Claimant indicates any error in the Tax Policy’s interpretation.
The ALJ finds that the evidence in the record establishes, prima facie, the vent hood cleaning services at issue are taxable.
Petitioner contends its services qualify as nontaxable scheduled and periodic maintenance. See 34 Tex. Admin. Code § 3.357. However, Texas Administrative Code § 3.357(a)(7) explicitly excludes taxable real property services from the definition of maintenance.
Petitioner also provided a description of water blasting, another service it performs. As a general proposition, power washing of improvements to realty has consistently been considered to be building or grounds cleaning, a taxable real property service under Texas Administrative Code § 3.356(a)(7). See STAR Document Nos. 9202L1155B07 (February 13, 1992), 9205L1172D01 (May 18, 1992) and 200006386L (June 7, 2000).
Petitioner provided a number of exhibits to support its position that its services were “required by statute, ordinance, order, rule, or regulation of any commission, agency, court, or political, governmental, or quasigovernmental entity in order to protect the environment or to conserve energy.” However, cites to regulatory requirements are not relevant as the services are limited to TPP for the services to be exempt. Tex. Tax Code § 151.338(a)(1), STAR Document No. 8909L0958A14 (September 11, 1989).
Even if Petitioner’s services were determined to not be real property services, Petitioner failed to demonstrate the services are excluded maintenance on real property which require a showing of scheduled, periodic work to operational and functional improvements to realty that is necessary to sustain or support safe, efficient, continuous operations, or to prevent the decline, failure, lapse, or deterioration of the improvement. See 34 Tex. Admin. Code § 3.357(a)(7). Petitioner did not provide any contracts, service agreements, or maintenance schedules for any of the scheduled transactions. Bare assertions in pleadings are insufficient to demonstrate error in the audit or satisfy the burden of proof. See Baker v. Bullock, 529 S.W.2d 279 (Tex. Civ. App.—Austin 1975, writ ref’d n.r.e.); Comptroller’s Decision Nos. 118,156 (2022) and 114,880 (2019).
The ALJ finds Petitioner has not met its burden to prove that its vent hood cleaning services qualify as nontaxable real property maintenance and finds that the vent hood services provided by Petitioner are taxable real property services.
2. Grease Traps
Although the IAR report states “No issue to resolve. Taxpayer agrees that its grease trap cleaning is taxable,” the Notice of Hearing stated Petitioner was contending that services provided on commercial kitchen grease traps should be recognized as repair, remodeling, maintenance, and restoration of TPP as defined by Texas Administrative Code § 3.292 and not a real property service as defined by Texas Administrative Code § 3.356.
Labor to repair, remodel, maintain, or restore tangible personal property is exempt if: (A) the repair, remodeling, maintenance, or restoration is required by statute, ordinance, order, rule, or regulation of any commission, agency, court, or political, governmental, or quasi-governmental entity in order to protect the environment or to conserve energy; and (B) the charge for the labor is itemized separately from the charge for materials furnished. 34 Tex. Admin. Code § 3.292(h)(1), (2).
Services to remove grease from a kitchen exhaust systems every 60 to 90 days is taxable as a real property service under section (a)(7)(1) of Rule 3.356, [ENDNOTE 7] just as the daily sweeping or cleaning or the floors are to prevent breeding of germs. STAR Document No. 8909L0958A14. The sales tax law exempts services to repair, restore, remodel, or maintain tangible personal property if they are required by statute, ordinance, rule, or regulation of any commission, agency court, or political, governmental, or quasi-governmental entity to protect the environment or to conserve energy. This provision does not apply to the services to remove grease from kitchen exhaust systems because these systems are considered improvements to realty. Id.
Comptroller Decision No. 42,854 (2004) held that because restaurant wastes are within the definition of “garbage,” which in turn is a “municipal solid waste,” and because Texas Administrative Code § 3.356(a)(3)(E) excludes “garbage” and “municipal solid waste” from the definition of “industrial solid waste,” disposal of restaurant wastes are not excluded from sales tax under Texas Tax Code § 151.0048. See Comptroller Decision No. 43,231 (2005).
Charges to clean grease traps which are not connected to the sewer line (i.e., an enclosed system) are taxable. The charges for cleaning the tank, transporting the materials, and the dumping fee are all taxable. Because these charges are taxable under Texas Administrative Code § 3.356 (real property service), there is no exemption even if the services are scheduled and periodic. See STAR Document No. 8909L0959B01 (September 24, 1989), see also Comptroller’s Decision No. 30,461 (1994). Petitioner did not provide any evidence, other than Ms. INDIVIDUAL A’s testimony, that the grease traps Petitioner serviced were connected to the sewer line. A taxpayer cannot satisfy its burden of proof with uncorroborated testimony on the ultimate issue to be proven. See Tex. Tax Code § 151.025; 34 Tex. Admin. Code § 3.281(b); see also, e.g., Comptroller’s Decision No. 117,668 (2022). Petitioner has not shown, by clear and convincing evidence, that the exemption applies, and the contention should be denied.
3. Inconsistent Comptroller Decisions
Petitioner contends the Comptroller has been inconsistent in his interpretation of vent hood maintenance, providing past rulings and guidance that conflicts with the determination that was delivered in Petitioner’s audit. Petitioner’s contention does not present a justiciable issue for the ALJ to consider as it fails to identify a contested issue in relation to the collection, receipt, administration, and enforcement of a tax. See Tex. Tax Code § 111.00455.
The audit should be affirmed except as agreed by Staff.
III. Findings of Fact
During the period at issue, ************** (Petitioner) provided various services, through vendors or sub-contractors, to food service, hospitality, and hospital customers.
Petitioner’s website states vendors take care of the actual service that they specialize in, and Petitioner takes care of the management, logistics, and systems.
Petitioner was audited by the Tax Division (Staff) of the Texas Comptroller of Public Accounts (Comptroller) for the audit period September 1, 2016, through March 31, 2020.
Petitioner provided sales journals, sales invoices, general ledgers, federal income tax returns, depreciation schedules, financial statements, and bank statements.
Petitioner does not contest that the vent hoods are improvements to real property, or that its vent hood cleaning services are performed on real property.
The auditor determined Petitioner’s vent hood cleaning services were taxable real property services.
The auditor determined sales tax collected was greater than sales tax reported by reviewing Petitioner’s general ledger account and reconciling amounts reported to the State. Errors for tax collected but not remitted are scheduled in Exam 100.
The auditor also assessed tax on nontaxed sales of kitchen vent hood cleaning as well as grease trap clearing, finding these were taxable real property services, and scheduled disallowed deductions in Exam 200.
Credits were allowed for error tax collected from customers in which a credit memo acceptance form was received. Credits for tax refunded are scheduled in Exam 201.
One asset was acquired during the audit period and the invoice for this asset was not provided. Adjustments for taxable purchases of assets are scheduled in Exam 300.
Petitioner requested an Independent Audit Review (IAR), and a conference was held on October 30, 2020.
On December 4, 2020, an IAR report was issued. The IAR considered all of Petitioner’s contentions and recommended no changes to the audit.
On February 1, 2021, Staff issued a Texas Notification of Audit Results assessing tax, penalty on tax collected but not remitted, and interest.
Petitioner timely requested redetermination.
Staff did not agree to adjust the assessment and referred the case to the State Office of Administrative Hearings (SOAH).
On November 4, 2024, Administrative Law Judge Kathy Pickup issued an Order Scheduling the Hearing on the Merits and Setting Pre-Hearing Requirements, establishing the date, time, and location of the hearing.
On November 5, 2024, Staff issued a Notice of Hearing to Petitioner. The notice contained a statement of the date, time, and location of the hearing; the nature of the hearing; a statement of the legal authority and jurisdiction under which the hearing was to be held; a reference to the particular sections of the statutes and rules involved; and a short, plain statement of the factual matters asserted, or an attachment that incorporated by reference the factual matters asserted in the complaint or petition filed with the state agency.
The Notice of Hearing was amended on February 14, 2025, to include an additional contention as requested by Petitioner.
On February 21, 2025, ALJ Kathy Pickup issued an Order Scheduling Hearing on the Merits and Converting to a Virtual Hearing.
The hearing convened on February 26, 2025.
The record closed on March 4, 2025, after the parties filed their respective exhibits offered and admitted at the hearing.
Staff agreed to waive interest for the period of April 1, 2023, through March 31, 2024.
IV. Conclusions of Law
The Comptroller has jurisdiction over this matter. Tex. Tax Code ch. 111.
SOAH has jurisdiction over matters related to the hearing in this matter, including the authority to issue a proposal for decision with findings of fact and conclusions of law. Tex. Gov’t Code ch. 2003.
Staff provided proper and timely notice of the hearing. Tex. Gov’t Code ch. 2001; Tex. Tax Code § 111.009.
Texas imposes a tax on each sale of a taxable item in this state. Tex. Tax Code § 151.051.
The term taxable item includes tangible personal property and taxable services. Tex. Tax Code § 151.010.
When tax is imposed on tangible personal property, the taxing entity’s prima facie burden of proof is easily met because, unless an exemption applies, all sales of tangible personal property in this state are taxable. See Comptroller’s Decision No. 116,506 (2020).
Only those services enumerated in Texas Tax Code § 151.0101 are subject to tax. Therefore, in a contested case hearing, Staff must establish, prima facie, not only that a service was sold but that the service is taxable. See, e.g., Comptroller’s Decision No. 102,386 (2014).
Once Staff’s initial burden is met, Petitioner bears the burden to establish by a preponderance of the evidence that the service is not taxable, or by clear and convincing evidence that the service is exempt. 34 Tex. Admin. Code § 1.26(c), (e); see also, Comptroller’s Decision No. 100,933 (2009).
Texas Tax Code § 151.0101(a)(5) includes the repair, remodeling, maintenance, and restoration of tangible personal property as a taxable service.
Taxable real property services are defined by statute to include building or grounds cleaning, janitorial, or custodial services. Tex. Tax Code §§ 151.0048(a)(4), .0101 (a)(11).
Taxable real property services include activities of keeping the inside and outside premises of a building clean, orderly, and functional, including performing minor adjustments, maintenance, or repairs. 34 Tex. Admin. Code § 3.356(a)(7).
Vent hood cleaning services are considered taxable real property service. See, e.g., Comptroller’s Decision Nos. 118,260 (2025), 42,854 (2004) (vent hood cleaning is a taxable building cleaning or janitorial service under Rule 3.356); see also State Tax Automated Research (STAR) Document Nos. 9110L1135D04 (October 10, 1991), 9905450L (May 27, 1999).
The evidence in the record establishes, prima facie, the vent hood cleaning services at issue are taxable.
The Tax Policy Division has on more than one occasion, indeed has consistently, stated its unequivocal position that vent hood cleaning is a taxable building cleaning or janitorial service under Rule 3.356, not real property repair and restoration as defined in Rule 3.357. Comptroller’s Decision No. 42,854 (2004); see also e.g., STAR Document Nos. 9110L1135D04 (October 10, 1991), 9905450L (May 27, 1999).
Maintenance on real property is a nontaxable service. 34 Tex. Admin. Code § 3.357(d)(2).
Texas Administrative Code § 3.357(a)(7) explicitly excludes taxable real property services from the definition of maintenance.
Power washing of improvements to realty has consistently been considered to be building or grounds cleaning, a taxable real property service under Texas Administrative Code § 3.356(a)(7). See STAR Document Nos. 9202L1155B07 (February 13, 1992), 9205L1172D01 (May 18, 1992), 200006386L (June 7, 2000).
Cites to regulatory requirements are not relevant as the services are limited to Tangible Personal Property for the services to be exempt. Tex. Tax Code § 151.338(a)(1), STAR Document No. 8909L0958A14 (September 11, 1989).
Excluded maintenance on real property requires a showing of scheduled, periodic work to operational and functional improvements to realty that is necessary to sustain or support safe, efficient, continuous operations, or to prevent the decline, failure, lapse, or deterioration of the improvement. See 34 Tex. Admin. Code § 3.357(a)(7).
Petitioner did not provide any contracts, service agreements, or maintenance schedules for any of the scheduled transactions. Bare assertions in pleadings are insufficient to demonstrate error in the audit or satisfy the burden of proof. See Baker v. Bullock, 529 S.W.2d 279 (Tex. Civ. App.—Austin 1975, writ ref’d n.r.e.); Comptroller’s Decision Nos. 118,156 (2022) and 114,880 (2019).
Petitioner has not met its burden to prove that its vent hood cleaning services qualify as nontaxable real property maintenance.
The vent hood services provided by Petitioner are taxable real property services.
Labor to repair, remodel, maintain, or restore tangible personal property is exempt if: (A) the repair, remodeling, maintenance, or restoration is required by statute, ordinance, order, rule, or regulation of any commission, agency, court, or political, governmental, or quasi-governmental entity in order to protect the environment or to conserve energy; and (B) the charge for the labor is itemized separately from the charge for materials furnished. 34 Tex. Admin. Code § 3.292(h)(1), (2).
Services to remove grease from a kitchen exhaust systems every 60 to 90 days is taxable as a real property service under section (a)(7)(1) of Texas Administrative Code § 3.356, just as the daily sweeping or cleaning or the floors are to prevent breeding of germs. STAR Document No. 8909L0958A14.
The sales tax law exempts services to repair, restore, remodel, or maintain tangible personal property if they are required by statute, ordinance, rule, or regulation of any commission, agency court, or political, governmental, or quasi-governmental entity to protect the environment or to conserve energy. This provision does not apply to the services to remove grease from kitchen exhaust systems because these systems are considered improvements to realty. STAR Document No. 8909L0958A14.
Because restaurant wastes are within the definition of “garbage,” which in turn is a “municipal solid waste,” and because Texas Administrative Code § 3.356(a)(3)(E) excludes “garbage” and “municipal solid waste” from the definition of “industrial solid waste,” disposal of restaurant wastes are not excluded from sales tax under Texas Tax Code § 151.0048. See Comptroller Decision Nos. 43,231 (2005), 42,854 (2004).
Charges to clean grease traps which are not connected to the sewer line (i.e., an enclosed system) are taxable. 34 Tex. Admin. Code § 3.356.
The charges for cleaning the tank, transporting the materials, and the dumping fee are all taxable. Because these charges are taxable under Texas Administrative Code § 3.356 (real property service), there is no exemption even if the services are scheduled and periodic. See STAR Document No. 8909L0959B01 (September 24, 1989), see also Comptroller’s Decision No. 30,461 (1994).
Petitioner did not provide any evidence, other than Ms. INDIVIDUAL A’s testimony, that the grease traps Petitioner serviced were connected to the sewer line.
A taxpayer cannot satisfy its burden of proof with uncorroborated testimony on the ultimate issue to be proven. See Tex. Tax Code § 151.025; 34 Tex. Admin. Code § 3.281(b); see also, e.g., Comptroller’s Decision No. 117,668 (2022).
Petitioner has not shown, by clear and convincing evidence, that the exemption applies, and the contention should be denied.
Petitioner’s contention that the Comptroller has been inconsistent in his interpretation of vent hood maintenance does not present a justiciable issue for the ALJ to consider as it fails to identify a contested issue in relation to the collection, receipt, administration, and enforcement of a tax. See Tex. Tax Code § 111.00455.
The audit should be affirmed except as agreed by Staff.
Signed March 5, 2025
Kathy Pickup
Presiding Administrative Law Judge
ENDNOTES
[1] The date calculated is 25 days after this decision is signed. See APA, Tex. Gov’t Code § 2001.146(a); S.B. 1095, Acts 2017, 85th Leg. For additional guidance, refer to the Frequently Asked Questions Related to Motions for Rehearing, found here: http://comptroller.texas.gov/taxes/publications/96-1789.pdf
[2] See Tex. Gov’t Code § 2003.101(e) and (f).
[3] At present, insufficient information is available to determine which items and amounts are disputed or undisputed for purposes of Tex. Tax Code, Ch. 112. In the absence of this information, the Comptroller will assume the entire amount of the assessment, as it appears in Comptroller’s Decision Attachment A, the Notification of Hearing Results, remains in dispute.
If Petitioner intends to sue the comptroller to dispute an amount of tax, penalty, or interest assessed in a deficiency redetermination or jeopardy determination under Tex. Tax Code, Ch. 111, Petitioner is required to file a motion for rehearing that “states the specific grounds of error and the disputed amounts associated with the grounds of error.” Tex. Tax Code § 112.201(a)(3). Petitioner should refer to Tex. Tax Code, Ch. 112, for further guidance regarding a suit after redetermination.
[4] See Tex. Tax Code § 111.0081(c).
[5] This hearing involved a company related to Petitioner, where the same argument was made regarding vent hood cleaning services. As in this hearing, Ms. INDIVIDUAL A was the only witness for the Petitioner in that hearing.
[6] Accessions are STAR Documents.
[7] See 20 TexReg 1749 (effective March 23, 1995).
ACCESSION NUMBER: 202503029H
SUPERSEDED: N
DOCUMENT TYPE: H
DATE: 2025-03-28
TAX TYPE: SALES
