CHAPTER Rev 700 MEALS AND RENTALS TAX

PART Rev 701 DEFINITIONS

REVISION NOTE:

Document #6690, effective 2-21-98, made extensive changes to the wording, format, structure, and numbering of rules in Part Rev 701. Several sections in part Rev 701 have been renumbered but not readopted, therefore, the effective date for these sections did not change.

Rev 701.01 "Caterer" means a person or persons engaged in providing a catered meal or meals including, but not limited to, a personal chef.

Source. (See Revision Note at part heading for Rev 701) #6690, eff 2-21-98; ss by #6750, eff 5-19-98, EXPIRED: 5-19-06

New. #8653, eff 6-8-06

Rev 701.02 "Catered meal" means a meal prepared or served by a person or persons engaged, as part of the regular course of business, in providing meals at various locations, such as but not limited to the serving of meals at:

(a) Special events;

(b) Banquets;

(d) Picnics;

(e) Bazaars;

(f) Field days;

(g) Outings;

(h) Barbecues;

(i) Mobile catering or vending trucks; or

(j) Private homes.

Source. (See Revision Note at part heading for Rev 701) #6690, eff 2-21-98; ss by #6750, eff 5-19-98, EXPIRED: 5-19-06

New. #8653, eff 6-8-06

Rev 701.03 "Confirmation number" means a unique number assigned by the department to a telefile or E-file transaction that identifies the electronic data submission.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92 (See Revision Note at part heading for Rev 701); ss by #6750, eff 5-19-98; ss by #7505, eff 6-19-01, ss by #8653, eff 6-8-06

Rev 701.04 “E-file” means the use of a computer to electronically transfer data to the department including authorization for the department to debit the operator’s specified account for an operator specified amount.

Rev 701.05 "Electronic authorization" means a digital signature comprised of the operator's license number and personal identification number.

Source. (See Revision Note at part heading for Rev 701) #6690, eff 2-21-98; ss by #6750, eff 5-19-98, EXPIRED: 5-19-06

New. #8653, eff 6-8-06

Rev 701.06 "Electronic data submission" means a E-file or telefile of electronic information transmitted to the department.

Source. (See Revision Note at part heading for Rev 701) #6690, eff 2-21-98; ss by #6750, eff 5-19-98, EXPIRED: 5-19-06

New. #8653, eff 6-8-06

Rev 701.07 "Furnishings and accommodations" means the personal property or facilities used or provided for use in conjunction with the renting of sleeping accommodations, such as but not limited to, the use of:

(a) Pools, beaches or other sites associated with swimming or boating;

(b) In-room television or radio;

(d) Restaurants, lounges or other facilities providing any forms of entertainment.

Source. (See Revision Note at part heading for Rev 701) #6690, eff 2-21-98; ss by #6750, eff 5-19-98, EXPIRED: 5-19-06

New. #8653, eff 6-8-06

Rev 701.08 "Hotel", means “hotel” as defined in RSA 78-A:3, III, and includes an adult summer or recreational camp which offers sleeping accommodations to the public.

Source. (See Revision Note at part heading for Rev 701) #6690, eff 2-21-98; ss by #6750, eff 5-19-98, EXPIRED: 5-19-06

New. #8653, eff 6-8-06

Rev 701.09 "Institution" means a federal, state, or county prison, reformatory, or mental hospital having confined residents unless the context indicates otherwise.

New. #8653, eff 6-8-06

Rev 701.10 "Meal" means “meal” as defined in RSA 78-A:3, X(a) and:

(a) Includes any food or food products, including, but not limited to:

(1) Sandwiches of any kind whether prepared or packaged on or off the premises;

(2) Beverages in unsealed containers including any alcoholic, malt, or vinous beverage;

(3) Food items from salad bars;

(4) Heated foods including, but not limited to, seafood, meats, soups, stews or chowders;

(5) Party platters or arrangements, including, but not limited to:

a. Vegetable;

b. Meat;

c. Dessert;

d. Bakery;

e. Fruit;

f. Hors d'oeuvres; or

(6) Prepared, ready-to-eat products whether or not such products have been warmed or cooled to a preferred temperature; and

(b) Does not include:

(1) Food or food products, wholly packaged off the premises of the operator and sold in their original unopened container, including, but not limited to, items such as:

a. Potato chips;

b. Corn chips;

c. Crackers and cheese;

d. Pastries;

e. Candy;

f. Gum;

g. Breath mints;

h. Cough drops; or

i. Antacid lozenges;

(2) Canned, bottled, or packaged ready-to-drink beverages wholly packaged off the premises of the operator and sold in their original unopened container unless required to be opened by the New Hampshire liquor commission pursuant to RSA 178:20, RSA 178:21, RSA 178:22, including, but not limited to, such items as:

a. Carbonated beverages; or

b. Fruit drinks; and

(3) Pre-packaged ready-to-eat refrigerated or frozen desserts or novelties, wholly packaged off the premises of the operator and sold in their original container, including, but not limited to, items such as ice cream or frozen yogurt in:

a. Cups;

b. Cones; or

c. Sticks.

New. #8653, eff 6-8-06

Rev 701.11 "Non-profit organization" means an organization listed and approved under Section 501(c), (3), (4), (7), (8), (10), and (19) of the Internal Revenue Code, provided such organization has not been issued a liquor license by the New Hampshire liquor commission.

Source. #5912, eff 10-14-94 (See Revision Note at part heading for Rev 701); ss by #6750, eff 5-19-98, EXPIRED: 5-19-06

New. #8653, eff 6-8-06

Rev 701.12 "Occupant" means “occupant” as defined in RSA 78-A:3, V, and includes a person who pays for sleeping accommodations even though he or she does not use them.

Source. (See Revision Note at part heading for Rev 701) #6690, eff 2-21-98; ss and moved by #6750, eff 5-19-98 (from Rev 701.11), EXPIRED: 5-19-06

New. #8653, eff 6-8-06

Rev 701.13 "Operator" means “operator” as defined in RSA 78-A:3, IV, and includes a person:

(a) Offering sleeping accommodations for rent to the public including owners of private homes who offer sleeping accommodations for rent to the public;

(b) Charging for a taxable meal;

(d) Who acts in the capacity of an agent for an owner in renting sleeping accommodations, a motor vehicle or providing taxable meals.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss by #5912, eff 10-14-94 (See Revision Note at part heading for Rev 701) ; ss and moved by #6750, eff 5-19-98 (from Rev 701.13); moved by #6870 (from Rev 701.14), eff 10-20-98, EXPIRES: 10-20-06, ss by #8653, eff 6-8-06

Rev 701.14 “Personal chef” means any person who prepares a taxable meal or meals for another person or persons using any food or beverage products purchased by the personal chef.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92 (See Revision Note at part heading for Rev 701); ss and moved by #6750, eff 5-19-98 (from Rev 701.14); moved by #6870 (from Rev 701.15), eff 10-20-98, EXPIRES:
10-20-06; ss by #8653, eff 6-8-06

Rev 701.15 “Personal Identification Number (PIN)” means the personal identification number selected by each operator for each licensed operation that elects to use either E-file or telefile.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92 (See Revision Note at part heading for Rev 701); ss and moved by #6750, eff 5-19-98 (from Rev 701.15); moved by #6870 (from Rev 701.16), eff 10-20-98l ss by #8653, eff
6-8-06

Rev 701.16 “Premises”, as referenced in RSA 78-A:3, X (a) and Rev 701.25 means, when referring to a convenience store, gas station or supermarket, the portion of such establishment where meals are offered, known industry-wide as “retail floor space”.

Source. (See Revision Note at part heading for Rev 701) #6690, eff 2-21-98; ss and moved by #6750, eff 5-19-98 (from Rev 701.16); moved by #6870 (from Rev 701.17); ss by #7505, eff 6-19-01; ss by #8653, eff 6-8-06

Rev 701.17 "Qualified educational organization" means an organization operated for educational purposes and is exempt from federal income taxes under section 501(c)(3) of the Internal Revenue Code.

Source. (See Revision Note at part heading for Rev 701) #6690, eff 2-21-98; ss and moved by #6750, eff 5-19-98 (from Rev 701.17); moved by #6870 (from Rev 701.18), eff 10-20-98; ss by #8653, eff 6-8-06

Rev 701.18 "Rent" means “rent” as defined in RSA 78-A:3, VIII, and includes:

(a) Any amount for which an occupant is liable as a result of occupancy without any deductions; and

(b) Any and all charges for services, facilities, or furnishings and accommodations customarily and ordinarily furnished by a hotel to occupants without charge in addition to that normally made for the room or rooms occupied by such person.

Source. (See Revision Note at part heading for Rev 701) originally #5912, eff 10-14-94; ss and moved by #6750, eff 5-19-98 (from Rev 701.18); ss by #6807, INTERIM, eff 7-21-98, EXPIRES: 11-18-98; ss and moved by #6870, eff
10-20-98 (from Rev 701.19); ss by #7505, eff 6-19-01; ss by #8653, eff 6-8-06

Rev 701.19 "Restaurant", means “restaurant” as defined in RSA 78-A:3, X(b) and:

(a) Includes installations of a permanent or temporary nature which are used in conjunction with the preparation or serving of meals such as, but not limited to:

(1) Tables;

(2) Counters;

(3) Bars;

(4) Concession stands;

(5) Booths at fairs, parks or other locations; or

(6) Other similar facilities where meals are served; and

(b) Does not include the portion of a business establishment such as within a convenience store, gas station, or supermarket that is not engaged in preparing or serving a meal.

Source. (See Revision Note at part heading for Rev 701) originally #5912, eff 10-14-94; ss and moved by #6750, eff 5-19-98 (from Rev 701.18); ss by #6807, INTERIM, eff 7-21-98, EXPIRES: 11-18-98; ss and moved by #6870, eff 10-20-98 (from Rev 701.19); ss by #8653, eff 6-8-06

Rev 701.20 "School" means “school” as defined in RSA 78-A:3, IX, and includes any educational organization whether public or private, provided its earnings do not inure to the benefit of any individuals.

Source. (See Revision Note at part heading for Rev 701) originally #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 701.19); moved by #6870 (from Rev 701.20), eff 10-20-98; ss by #8653, eff 6-8-06

Rev 701.21 "Seasonal business" means a business which operates and receives taxable receipts on a regular basis only during a particular season of the year, for a consecutive period of less than 12 months, such as, but not limited to:

(a) The skiing and winter sports season;

(b) Fall foliage season, and

Source. (See Revision Note at part heading for Rev 701) originally #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 701.20); moved by #6870 (from Rev 701.21), eff 10-20-98, ss by #8653, eff 6-8-06

Rev 701.22 “Services", as referenced in the definition of "occupancy" in RSA 78-A:3, VI, means:

(a) The provision of services customarily and ordinarily related to the occupancy and use of sleeping accommodations and facilities, such as, but not limited to:

(1) Maid and porter;

(2) Towel and linen;

(3) Doorman, bellhop, and concierge;

(4) Elevator services; and

(5) Data port connections; and

(b) Does not include services not customarily and ordinarily related to the occupancy and use of sleeping accommodations and facilities when a separately stated charge is made, including, but not limited to:

(1) Parking;

(2) Telephone connection fees and charges;

(3) Data port connection fees and charges;

(4) Secretarial or commercial assistance;

(5) Purchase of theater, sports, or amusement tickets; or

(6) Parcel checking and delivery.

Source. (See Revision Note at part heading for Rev 701) #6690, eff 2-21-98; ss and moved by #6750, eff 5-19-98 (from Rev 701.21); moved by #6870 (from Rev 701.22), eff 10-20-98, ss by #8653, eff 6-8-06

Rev 701.23 “Signature” means:

(a) The handwritten endorsement by an individual; or

(b) The operator’s license number combined with the operator’s PIN for electronic data submission.

Source. (See Revision Note at part heading for Rev 701) originally #5399, eff 5-21-92 ; ss by #6750, eff 5-19-98; moved by #6870 (from Rev 701.23), eff 10-20-98, ss by #8653, eff 6-8-06

Rev 701.24 “Telefile” means the use of a telephone key pad to electronically transfer data to the department.

Source. (See Revision Note at part heading for Rev 701) originally #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 701.23); moved by #6870 (from Rev 701.24), eff 10-20-98; ss by #8653, eff 6-8-06

Rev 701.25 "Wholly packaged off the premises", as referenced in RSA 78-A:3, X(a), means mechanically or hermetically sealed, unopened containers or packages such as, but not limited to, those that are subject to the inspection requirements of the Standards of Weights and Measures as provided in RSA 438, in a facility other than where the item is being sold.

Source. (See Revision Note at part heading for Rev 701) originally #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 701.24); moved by #6870 (from Rev 701.25), eff 10-20-98; ss by #8653, eff 6-8-06

PART Rev 702 COMPUTATION OF TAXABLE MEALS AND RENTALS

Rev 702.01 Inclusive Tax Calculation. When the tax is included in the price of taxable meals, occupancies or motor vehicle rentals, the tax shall be equal to 7.41% of such charge.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss by #5912, eff 10-14-94; ss by #6750, eff 5-19-06, EXPIRED: 5-19-06

New. #8653, eff 6-8-06

Rev 702.02 Meals Prepared and Sold by Non-Profit Organizations Other Than Educational Organizations. Meals prepared and sold by a non-profit organization, which is required to obtain a liquor license from the New Hampshire liquor commission, other than a one day license pursuant to RSA 178:22, V (l), for 3 or fewer days per year, shall be taxable:

(a) With or without the sale of alcoholic beverages; and

(b) Regardless of the purchaser, including but not limited to members, officers and guests.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 702.01); ss by #8653, eff 6-8-06

Rev 702.03 Catered Meals Served at Non-Profit Organizations.

(a) Meals sold by qualified non-profit organizations, as provided in RSA 78-A:3, X(c)(1), (2), and (7), shall be exempt from tax.

(b) Meals purchased by non-profit organizations shall not be exempt from tax except as provided in Rev 702.19.

(c) Meals served or furnished by a caterer or other food service operator under contract to an educational organization, at an educational institution, shall not be subject to tax provided the meals are served or furnished only to:

(1) Students regularly attending the institution, or employees, faculty members, or administrative officers of the institution;

(2) Volunteers providing service to the organization, sponsored through the organization, or in contract with the organization; or

(3) Any other persons involved in an activity which is related to an educational purpose, as defined in RSA 78-A:3, X(c)(2)(D), such as but not limited to:

a. Adult education;

b. Professional continuing education seminar attendees; and

c. The conduct of alumni, student or athletic functions or events of their specific institution.

(d) Meals served or furnished by a caterer at any non-profit educational organization which constitute non-educational social functions such as weddings or parties shall be taxable.

Rev 702.04 Catering Charges.

(a) All items, products, or services customarily associated with the preparation or service of a taxable meal shall be taxable even when a separate charge is made.

(b) The items referred to in (a), above, shall include, but not be limited to:

(1) All dishes of every kind including china;

(2) Flatware;

(3) Silverware;

(4) Linens;

(5) Napkins;

(6) Paper products;

(7) Bar set-ups;

(8) Tables or chairs provided by the operator;

(9) Sterno ovens; or

(10) Heating or refrigeration equipment.

(d) The cost of preparation and service personnel shall be taxable except when it is unrelated to the taxable meal, such as but not limited to, valet parking, photography, or the charge meets the non-taxable requirements outlined in Rev 702.11.

(e) Items, such as tent rentals or decorations, not customarily associated with the preparation and service of a taxable meal that are optional and separately stated, shall not be taxable.

(f) Any charges included in the price of the meal shall not be allocated as nontaxable items after the event.

Rev 702.05 Furnished Meals.

(a) Meals furnished by an operator to its employees for which the employee is required to pay a charge either by the cost being withheld from the employee’s wages or by actual payment, shall be subject to tax based on the amount deducted or paid by the employee.

(b) In accordance with RSA 78-A:3, X(c)(2), meals furnished by a qualified educational organization to an employee, faculty member, administrative officer, or volunteer providing service to the organization, sponsored through the organization, or in contract with the organization, shall not be subject to tax regardless of the cost or payment method.

Source. #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss by #5912, eff 10-14-94; ss and moved by #6750, eff 5-19-98 (from Rev 702.04); ss by #8653, eff
6-8-06

Rev 702.06 Hospitals. If a cafeteria or restaurant is operated on hospital property and the meals sold are available to the public, all non-patients meals sold shall be subject to tax unless such meals are furnished by a non-profit organization.

Source. #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss by #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 702.07 Medical Facilities. If a restaurant is operated on the premises of a medical facility specified in RSA 78-A:3, X(c)(4) and meals are sold to persons other than patients and employees, then all non-patient and non-employee meals sold shall be subject to tax unless such meals are furnished by an organization exempt under RSA 78-A:3, X(c)(1) or (7).

Source. #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 702.05); ss by #8653, eff 6-8-06

Rev 702.08 Schools and Students.

(a) Meals served by an operator which is a qualified educational organization or an agent under contract with such organization, to students on or off school premises, in conjunction with an educational purpose, shall not be taxable.

(b) Meals, served to students by operators other than those referenced in (a), above, shall be subject to tax.

(1) Meals delivered to students on or off school premises; and

(2) Meals served to students for social functions on or off school premises.

(d) Meals served by an operator, which is a qualified educational organization or an agent under contract with such organization to members of the faculty, employees, administrative officers or to any non-student organization pursuant to an activity which is related to an educational purpose, as defined in RSA 78-A:3, VI(b)(2)(D), shall not be subject to tax.

(e) Meals served by an operator which is a qualified educational organization or an agent under contract with such organization to any individual or group receiving instruction or training on school premises shall not be subject to tax provided the instruction or training:

(1) Fulfills an educational purpose, as defined in RSA 78-A:3, VI(b)(2)(D); and

(2) Is sponsored by:

a. An organization exempt from federal income taxation under section 501(c) of the Internal Revenue Code; or

b. The federal or state government or an instrumentality thereof.

(f) Meals served by an operator to any individual or group receiving instruction or training sponsored by a qualified educational organization shall not be subject to tax.

(g) Meals served by an operator which is a qualified educational organization or an agent under contract with such organization to any individual or group on school premises for a non-educational purpose, including but not limited to weddings and parties, shall be subject to tax.

Source. #4061, eff 5-29-86; ss by #5399, eff 5-21-92; amd by #5912, eff 10-14-94 ss and moved by #6750, eff 5-19-98 (from Rev 702.06); ss by #8653, eff 6-8-06 (formerly Rev 702.07)

Rev 702.09 Institutions. Meals served on the premises of, and to the residents or employees of, the institution shall not be subject to tax.

Source. #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 702.07); ss by #7613, eff 12-19-01; ss by #8653, eff 6-8-06 (formerly Rev 702.08)

Rev 702.10 State and Federal Government.

(a) When an instrumentality of the state of New Hampshire, a New Hampshire county or municipality, or the federal government enters into a contract with an operator to provide meals, rooms, or rentals such items shall not be taxable if:

(1) The charge is:

a. An ordinary and necessary expense of that governmental instrumentality and the activity does not constitute entertainment, amusement, or recreation; and

b. Incidental to the governmental instrumentality's statutorily authorized duties;

(2) An affidavit of government business filed with the operator stating the official business and certifying direct payment shall be made by the government instrumentality; and

(3) The charge is paid for with one of the following:

a. A check from the treasurer, state of New Hampshire;

b. A check from the U.S. Treasury;

c. A check from a New Hampshire county or municipality treasurer; or

d. A U.S. government or state of New Hampshire issued credit card in the employee's name where the charge is paid directly by the government or state and not by employee reimbursement.

(b) Meals, rooms, or rentals charges incurred by a customer possessing a valid diplomatic tax exemption card issued by the United States Department of State shall not be taxable when an instrumentality of the state of New Hampshire, a New Hampshire county or municipality, or the federal government enters into a contract with an operator to provide meals, rooms, or rentals.

(c) Nothing herein shall be construed to grant an exemption to individuals even when they present certificates claiming exemptions, for any charges:

(1) Incurred outside of the individuals’ capacity as agents for the governmental unit; or

(2) Paid for from a per diem allowance given to the individual by the governmental unit.

Source. #4061, eff 5-29-86; ss by #5399, eff 5-21-92; amd by #5912, eff 10-14-94; ss and moved by #6750, eff 5-19-98 (from Rev 702.08); ss by #8653, eff 6-8-06 (formerly Rev 702.09)

Rev 702.11 Taxable Rent.

(a) Property for which taxable rent shall be received includes any type of shelter that provides sleeping accommodations such as, but not limited to, furnished:

(1) Houses;

(2) Cottages;

(3) Apartments;

(4) Camps or lodges of any kind;

(5) Chalets;

(6) Rooms; or

(7) Dormitories.

(b) Rents received for locations in a hotel, including, but not limited to, a convention hall, dining room, store, office, or any other space shall be taxable unless the requirements of permanent residency under Rev 702.13, are met.

(c) The amount representing the equivalent rent when a hotel employee receives a portion of his or her remuneration in the form of occupancy within the hotel shall not be subject to tax.

(d) Hotel rooms furnished by an operator to its employees who receive a fixed salary or wages and for which the employee is required to pay a charge, either by the cost being withheld from their wages or by actual payment, shall be subject to tax based on the amount deducted or paid by the employee.

(e) The charge for rent for occupancy in any summer camp operated for children shall:

(1) Not be taxable if operated exclusively for children whether such occupancy be that of a child, parent, guardian, or an employee; and

(2) Be taxable if rental accommodations are open to the public but only to the extent of the rent received from the public who are not children enrolled in the camp, their parents or camp employees.

(f) Rent paid by a student shall:

(1) Not be taxable for any occupancy necessitated by his or her attendance at a school, no part of the earnings of which inure to the benefit of any individual; and

(2) Be subject to tax if a student rents a room temporarily for himself or a guest to attend a social, athletic or other non-educational function.

(g) The rent received by non-profit organizations shall be subject to tax if sleeping accommodations are available to the public.

(h) A hotel owned by a non-profit organization, at which a person may rent a room in the same manner as a commercial hotel, shall collect the appropriate tax on the rent received.

(i) Members of a non-profit organization staying at a hotel that is open to the public shall be subject to tax.

Source. #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 702.09); ss by ##8653, eff 6-8-06 (formerly Rev 702.10)

Rev 702.12 Exceptions to Taxable Rent.

(a) A camping area providing only tent or trailer sites shall not be subject to tax.

(b) If, in a camping area, there is available for rent a building or other structure, including a tent, which provides sleeping accommodations, such as, but not limited to, beds, cots, mattresses, and bunks, the rent from such accommodations shall be subject to tax.

(c) The charge for the use of a camping or travel trailer or similar equipment rented from an agent, dealer, or other person shall:

(1) Not be taxable as rent for sleeping accommodations when rented for the purpose of being transported from place to place by a motor vehicle for camping; and

(2) Be taxable when it is not moved over the road but is used for sleeping accommodations at the place where rented.

Source. #5399, eff 5-21-92; ss by #5912, eff 10-14-94; ss and moved by #6750, eff 5-19-98 (from Rev 702.02); ss by #8653, eff 6-8-06 (formerly Rev 702.11)

Rev 702.13 Computation of Permanent Residency.

(a) In determining whether or not a person is a permanent resident, as defined in RSA 78-A:3, VII, computation of the period of occupancy shall begin with the first day such person occupies any room in a hotel.

(b) If the period during which the accommodations are to be rented is not known, or anticipated to be less than 185 consecutive days, the tax shall be collected when the rent is paid.

(c) If there is a signed lease, or any other similar document, between the operator and the occupant for a period of 185 or more consecutive days, the operator shall not be required to collect tax from the occupant. If the occupancy does not continue for 185 or more consecutive days, the operator shall be responsible for the payment of the tax on the total amount of rent paid.

(d) The operator shall refund to the occupant any tax collected prior to the 185th day if the rental period continues for 185 or more consecutive days.

(e) If any portion of such tax has been remitted to the state, it shall be returned to the operator through the issuance of a notice of credit or refund to the operator upon written request by the operator, in conformity with (f) and (g) below, received within the statute of limitations provided in RSA 21-J:29, I(b), pursuant to RSA 21-J:28-a.

(f) The request in (e) above shall be submitted to:

New Hampshire Department of Revenue Administration

Audit Division

PO Box 457

Concord, NH, 03302-0457.

(g) The request pursuant to (e), above, shall include:

(1) Verification that the tax has been refunded to the occupant, such as but not limited to:

a. Copies of both sides of the canceled check; or

b. A signed statement from the tenant attesting to the refund received;

(2) Documentation supporting the original remittance of such tax to N.H.; and

(3) Proof of the period of occupancy which documents the beginning date of occupancy through the date permanent residency was achieved, such as, but not limited to:

a. Copies of the original registration card; or

b. Copies of the original rental agreement with any amendments made to the original agreement.

(h) The operator shall continue to retain the original documentation relating to permanent residents in accordance with the provisions of Rev 706.

(i) The operator may use the credit issued pursuant to (e), above, to reduce the operator’s liability on any return filed subsequent to the receipt of the notice of credit by the operator.

Source. #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 702.10); ss by #8653, eff 6-8-06 (formerly Rev 702.12)

Rev 702.14 Non-Taxable Charges.

(a) Items, exclusive of gratuities, not customarily associated with a taxable room or with the preparation and service of a taxable meal shall not be taxable if:

(1) It is possible to purchase the taxable room or meal without the additional charge; and

(2) The charges are not for items, products or services customarily associated with the preparation or services of a taxable meal or taxable room.

(b) The burden shall rest with the operator to establish a system of control and accounting pursuant to RSA 78-A:19 and Rev 706.01 for non-taxable charges which:

(1) Correctly and accurately reflects the actual charges made;

(2) Separately accounts for such non-taxable charges from other taxable receipts in the books and records of the operator; and

(3) Allocates the taxable and non-taxable charges as if the charges had been made separately in an arm's length transaction.

(c) If, through the setting of taxable and non-taxable charges, the proper tax has not been reported, then the department shall rely on its authority under RSA 78-A:11 to assess the tax liability.

Source. #5399, eff 5-21-92; amd by #5912, eff 10-14-94; ss and moved by #6750, eff 5-19-98 (from Rev 702.11); ss by #8653, eff 6-8-06 (formerly Rev 702.13)

Rev 702.15 Admission Charges.

(a) Admission charges collected by an operator shall not be taxable if:

(1) The charge is made for admission only; and

(2) The charge does not include any free or discounted meals, rooms or both.

(b) Free or discounted products routinely available when an admission charge is not made, shall not make an admission charge taxable.

Source. #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 702.12); ss by #8653, eff 6-8-06 (formerly Rev 702.14)

Rev 702.16 Free Coupons, Discounts, Complementary Sales, and Other Free Promotional Items.

(a) When an operator gives a free promotional coupon, gift certificate, or other document for no consideration, and the document is redeemed, the tax shall be computed on the actual amount paid for the taxable meal or rental, excluding the face value of the coupon or the amount discounted, as illustrated below:

2 for 1	20% Discount

$10.00 Dinner	$10.00 Dinner
$10.00 2^nd Dinner	($2.00) discount
$20.00 Total Meals	$8.00 Total Meal
($10.00) Free Dinner	.64 tax at 8%
$10.00 Total	$8.64 Total Paid
.80 tax at 8%
$10.80 Amount Paid

Tax Due = .80	Tax Due = .64

(b) All supporting source documents, such as, but not limited to, cash register tapes, guest checks, and registration cards, shall show the tax calculation, unless tax is included in the charge made for the meal or room.

(c) Donated goods and services, including meals, gift certificates, sleeping accommodations, and complementary sales, shall not be taxable, provided no consideration was given for the goods and services.

(d) Barter transactions, such as, but not limited to, meals exchanged for advertising, shall be taxable to the extent of the usual and customary charge for such taxable meal or room rental exchanged.

Source. #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 702.13); ss by #8653, eff 6-8-06 (formerly Rev 702.15)

Rev 702.17 Coupons, Gift Certificates and Meal Tickets Purchased from an Operator.

(a) Gift certificates, coupons, or other documents purchased from an operator for the purpose of future redemption for value, products, or services shall not be taxable when purchased.

(b) When purchased coupons or gift certificates are redeemed:

(1) The portion of the charge attributable to taxable meals or taxable rooms shall be taxable to the customer; and

(2) The tax shall be applied on a basis equivalent to sales made with traditional payment methods without regard to the original purchase price of the coupon or gift certificate.

(c) If the taxable meal or room has no stated value, such as, but not limited to, a meal ticket sold for redemption of a fixed number of cafeteria style dinners, the meal ticket or other document shall be taxed at the time of purchase for the actual amount paid for the ticket.

Source. #5399, eff 5-21-92; amd by #5912, eff 10-14-94; ss and moved by #6750, eff 5-19-98 (from Rev 702.15); ss by #8653, eff 6-8-06 (formerly Rev 702.16)

Rev 702.18 Bakery Sales.

(a) A “bakery”, for the purpose of this section, means an establishment selling primarily baked goods.

(b) A bakery shall meet the definition of a restaurant as provided in RSA 78-A:3, X(b) and Rev 701.19 if it sells taxable meals, as defined in RSA 78-A:3, X(c).

(1) Multiple items sold for an aggregate price of 35 cents or less in a single transaction as provided in RSA 78-A:6;

(2) Items that are wholly packaged off the premises and are sold in their original unopened container, except sandwiches as provided in RSA 78-A:3, X(a), such as, but not limited to, canned soda and vending type prepackaged coffee cake;

(3) All single serving bakery products sold in a quantity of 6 or more, such as, but not limited to, donuts, cookies, brownies, or bagels; or

(4) Whole, multiple serving bakery products, such as, but not limited, to cakes, pies, or bread.

(d) The method or location of payment shall not affect the taxability of a product.

(e) A bakery that does not meet the definition of a restaurant pursuant to RSA 78-A:3, X(b) and Rev 701.19 shall not be subject to the provisions of RSA 78-A.

(f) Establishments known as convenient stores, gas stations or supermarkets, as those terms are used in RSA 78-A:3, X(b), shall not be considered bakeries for the purposes of this section.

Source. #5912, eff 10-14-94; ss and moved by #6750, eff 5-19-98 (from Rev 702.16); ss by #8653, eff 6-8-06 (formerly Rev 702.17)

Rev 702.19 Sales For Resale. Operators providing meals for resale shall not be responsible for collecting the tax provided that:

(a) The sale is to another operator and the seller's documentation indicates the purchaser’s meal and rentals tax license number;

(b) The sale is to a non-profit organization; or

(c) The operator clearly states on the invoice that the tax has not been collected and its collection shall be the responsibility of the purchaser.

Source. #6750, eff 5-19-98 (from Rev 702.17); amd by #6870, eff 10-20-98; ss by #8653, eff 6-8-06 (formerly Rev 702.18)

Rev 702.20 Meal Delivery Services Businesses.

(a) A meal delivery service business shall be an operator for purposes of the meals and rentals tax if:

(1) The consumer purchases a taxable meal directly from the meal delivery service business; and

(2) The price paid by the consumer to the meal delivery service business for the meal includes its purchase and delivery to the consumer.

(b) In instances where the meal delivery services business is a meals and rental tax operator, the meals sold by a restaurant to the meal delivery service business shall be sales for resale as provided under Rev 702.19.

(c) In instances where a meal delivery services business merely provides a delivery service to a restaurant for a fee, and such fee is separately stated to the consumer, the restaurant shall be responsible for the collection of the meals tax from the consumer on the cost of the meal.

Source. #6750, eff 5-19-98, EXPIRED: 5-19-06

New. #8653, eff 6-8-06 (formerly Rev 702.19)

PART Rev 703 LICENSING AND RESPONSIBILITIES OF OPERATORS

Rev 703.01 Requirement For License.

(a) Every individual or entity intending to sell meals, rent motor vehicles, or rent rooms shall apply for an operator’s license and be issued one by the department prior to the opening of business.

(b) Persons shall obtain a Form CD-3, "Application for Meals and Rentals Tax Operator’s License", by:

(1) Accessing www.nh.gov/revenue/forms online, if available;

(2) Calling the division at (603) 271-3701; or

(3) Writing to:

NH Department of Revenue Administration

Collection Division

PO Box 454

Concord, NH 03302-0454.

(d) A caterer shall obtain:

(1) A separate operator's license for each fixed location where taxable meals are regularly served; and

(2) A single separate operator's license for the occasional serving of meals at special events, such as but not limited to:

a. Banquets;

b. Receptions;

c. Picnics;

d. Bazaars;

e. Fairs;

f. Field days;

g. Outings;

h. Barbecues; or

i. Private homes.

(e) Any person in the business of renting motor vehicles shall obtain a separate operator's license for each fixed location where vehicles are rented.

(f) Mobile catering and vending truck operators shall:

(1) Obtain a single operator's license covering the overall business rather than an individual operator's license for each mobile vending truck they operate;

(2) Display their operator’s license number on the outside of each vehicle; and

(3) Display a reprint provided by the department of revenue administration of their license in each vehicle.

(g) A meals and rentals tax operator’s license shall not be transferable.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss by #6690, eff 2-21-98; ss by #6750, eff 5-19-98; ss by #7505, eff 6-19-01; ss by #8653, eff 6-8-06

Rev 703.02 Discontinuance. When an operator discontinues business, the operator shall return the license to the department of revenue administration.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 703.03); ss by #8653, eff 6-8-06

Rev 703.03 Employee Cafeteria Operators. Employers operating cafeterias, where taxable meals are sold, shall obtain an operator's license.

Rev 703.04 Personal Identification Number (PIN). When an operator receives a PIN notification from the department of revenue administration, the operator shall not disclose the PIN to any employee of the department.

Source. #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss and moved by #6750, eff 5-19-98 (from Rev 703.05); ss by #8653, eff 6-8-06

Rev 703.05 Changing a PIN.

(a) If a change in PIN is required because an operator has lost his or her PIN and been locked out of the system after making 3 attempts to enter the system, the operator shall request the PIN be reset by calling the department of revenue administration at (603)271-2191.

(b) The operator shall provide specific information from the operator’s records, such as a prior filed return confirmation number or a dollar amount of a prior return, that can be used for verification by the department of revenue administration.

Source. #6690, eff 2-21-98; ss by #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 703.06 Credit Card and In-House Charges. Operators who accept credit cards or in house charges may demand and collect the tax imposed under RSA 78-A in cash at the time the bill is signed by the patron.

Source. #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 703.07 Non-Payments. An operator shall not be responsible, except as provided in Rev 703.09, for the remittance of any tax due as a result of non-collection of:

(a) A bad check;

(b) A credit card charge not honored by the issuing bank; or

Source. #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 703.08 Collection Agency Recoveries. An operator shall:

(a) Be responsible for the payment of the tax collected from a person by a debt collection agency; and

(b) Not deduct commissions or costs paid to the collection agency from the amount of taxes collected and remitted to the state.

Source. #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 703.09 Loss Due to Theft. An operator shall make remittance to the state for the amount collected even if tax money is stolen from an operator.

Source. #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 703.10 Transfer of Customers to Another Operator.

(a) When a hotel operator arranges for guests to be housed at another hotel, but collects the rent from such guests, the operator who arranges for the occupancies shall be responsible for the collection and remittance of the entire tax.

(b) When a motor vehicle rental operator arranges for, or obtains a rental vehicle through another operator but collects the rent from such customers, the operator who arranges for the vehicles shall be responsible for the collection and remittance of the entire tax.

Source. #6750, eff 5-19-98; ss by #7505, eff 6-19-01; ss by #8653, eff 6-8-06

PART Rev 704 RETURNS AND ELECTRONIC FILING REQUIREMENTS

Rev 704.01 Participation in E-File or Telefile.

(a) In accordance with RSA 78-A:8, I and II, all operators shall file tax returns by electronic data submission and remit taxes through an electronic funds transfer, as defined in Rev 2501.08, except when the operator:

(1) Is filing:

a. A final return; or

b. A scheduled estimate ordered by the department of revenue administration;

(2) Has been authorized to file Form DP-14 as provided in Rev 704.07; or

(3) Has elected not to use the E-file as defined in Rev 701.04, or telefile method of filing and paying the tax, by complying with the provisions of Rev 704.07(b) through (e).

(b) Failure to comply with the requirements of this section shall result in the forfeiture, pursuant to RSA 78-A:8,V, of an operator’s commission which would otherwise be allowed in RSA 78-A:7, III.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss by #5912, eff 10-14-94; ss and moved by #6690, eff 2-21-98 (see Rev 704.03); ss by #6750, eff 5-19-98; ss by #6807, INTERIM, eff 7-21-98, EXPIRES: 11-18-98; ss by #6870, eff 10-20-98; ss by #8653, eff 6-8-06

Rev 704.02 Required Accounts. For the purposes of remitting taxes, all operators using the E-file or telefile, as defined in Rev 2501.15, methods of filing and payment of the tax shall name an existing account, or establish a new account with a financial institution which is capable of participating in an automated clearing house transaction.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; amd by #5912, eff 10-14-94; ss and moved by #6690, eff 2-21-98 (see Rev 704.04); ss by #6750, eff 5-19-98; ss by #6870, eff 10-20-98; ss by #8653, eff 6-8-06

Rev 704.03 Permission to File Quarterly Returns.

(a) An operator may request permission from the department of revenue administration to file calendar quarterly meals and rentals tax returns for calendar quarters ending March, June, September, and December.

(b) Such request shall:

(1) Be made in writing to

New Hampshire Department of Revenue Administration

Collection Division

PO Box 454

Concord, NH 03302-0454; and

(2) Certify:

a. The business is an operational, year-round business;

b. The business has been in operation for a full year prior to the request;

c. The business is in full compliance with all provisions of RSA 78-A; and

d. The average meals and rental tax liability of the business is less than $100.00 per month for the calendar quarter immediately preceding the submission of the request.

(1) Meets the requirements in (b), above;

(2) Has a history of timely filing and payment of tax; and

(3) Has no outstanding tax liability at the time of the request.

(d) The due date, pursuant to RSA 78-A:8, III, of a quarterly filing shall be the 15th day of the month following the end of each calendar quarter, beginning with the first quarter after receipt of the department or revenue administration’s approval.

(e) The operator shall commence monthly filings beginning with the first month of the next calendar quarter if, during any subsequent calendar quarter, the average tax liability exceeds $100.00 per month.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; amd by #5912, eff 10-14-94 (renumbered by #6690, eff 2-21-98 from Rev 704.01); ss and moved by #6750, eff 5-19-98 (from Rev 704.07); ss by #8653, eff 6-8-06

Rev 704.04 Seasonal Operators.

(a) An operator seeking to file as a seasonal business shall request in writing, permission to make less than 12 monthly meals and rentals tax returns and remittances per year by writing to:

New Hampshire Department of Revenue Administration

Collection Division

PO Box 454

Concord, NH 03302-0454.

(b) Requests to file as a seasonal operator shall be granted provided the operator:

(1) Has not requested a season that consists of non-consecutive months;

(2) Does not have 2 or more seasons such as, but not limited to June through October, and December through April;

(3) Has a history of timely filing and payment of tax; and

(4) Has no outstanding tax liability at the time of request.

(c) In the event that the status of a business changes from a seasonal business to a year-round operation, the operator shall:

(1) Notify the collection division, in writing, of such change;

(2) Specify the effective date of the change; and

(3) Make a return and remittance as provided in RSA 78-A:8.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; amd by #5912, eff 10-14-94 (renumbered by #6690, eff 2-21-98 from Rev 704.02); ss and moved by #6750, eff 5-19-98 (from Rev 704.08); ss by #8653, eff 6-8-06

Rev 704.05 Consolidated Returns.

(a) Any operator who files 2 or more returns each month for a single legal entity may request, in writing, to enter into an agreement with the department of revenue administration to file on a consolidated basis.

(b) The request shall be:

(1) Accompanied by an agreement signed and dated by the operator, stating the conditions described in (d) below; and

(2) Submitted to:

New Hampshire Department of Revenue Administration

Collection Division

PO Box 454

Concord, NH 03302-0454.

(1) Operator’s designation of one license number to be the master license number;

(2) Business name and license number for each member; and

(3) Address for each member.

(d) An operator filing a consolidated return shall:

(1) Abide by the requirements contained in Rev 704;

(2) Notify the department of revenue administration, in writing, of any additions or deletions to the consolidated group within 10 days of any change;

(3) Continue to use the designated master license number unless written approval, pursuant to (e) below, has been granted to change the designation;

(4) Keep records readily available that show activity by month for each individual license;

(5) Permit the department of revenue administration to make all assessments against and collect from the master license for any member of the consolidated group when the records required in (4) are not made available; and

(6) Resume filing separate returns for each license number when notified by the department of revenue administration that the operator failed to comply with the provisions of (1) through (5) above.

(e) Provided the operator meets the requirements in (b), (c), and (d), above, permission shall be granted for filing on a consolidated basis.

(f) Interest, penalties, or both, allowed by RSA 21-J, shall be applied if either the consolidated return or the payment is delinquent.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; amd by #5912, eff 10-14-94 (renumbered by #6690, eff 2-21-98 from Rev 704.04); ss and moved by #6750, eff 5-19-98 (from Rev 704.10); moved by #6870 (from Rev 704.06); ss by #8653, eff 6-8-06

Rev 704.06 Extension of Time for Filing Returns.

(a) An operator shall submit a written request for an extension of time to file a return by providing:

(1) The reason for the extension;

(2) The operator's federal identification number;

(3) The operator’s meals and rentals tax license number;

(4) An explanation, with supporting documentation, of factors beyond the control of the operator that will create the delay in filing the return, if applicable; and

(5) Payment of 100% of the tax determined to be due.

(b) The request shall be submitted, on or before the due date of the meals and rentals tax return, to:

New Hampshire Department of Revenue Administration

Collection Division

PO Box 454

Concord, NH 03302-0454

(1) The information required in (a) (1) through (a) (4) is not complete;

(2) The tax determined to be due has not been paid in full as required in (a) (5) above;

(3) The request was not timely filed as required in (b) above; or

(4) The delay factor(s) in (a) (4) above does not support that filing was beyond the operator’s control.

(d) Upon receipt of a letter granting the shortest extension time practicable based on the operator’s circumstances, the operator shall comply with the time limits specified therein.

Source. #2690, eff 4-20-84; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; amd by #5912, eff 10-14-94; ss and moved by #6690, eff 2-21-98 (from Rev 704.05); ss and moved by #6750, eff 5-19-98 (from Rev 704.11); moved by #6870 (from Rev 704.07); ss by #8653, eff 6-8-06

Rev 704.07 Acceptable Tax Submission.

(a) Operators shall file monthly returns and remit payment through electronic data submission and electronic funds transfer, as defined in Rev 2501.08, and pursuant to RSA 78-A:8, I and II, except as described in (b) through (e) below.

(b) Form DP-14, “Meals and Rentals Tax Return”, shall be filed for final returns.

(d) An operator may obtain additional copies of Form DP-14 by:

(1) Photocopying Form DP-14, provided in the meals and rentals tax booklet;

(2) Online at www.nh.gov/revenue/forms, if available;

(3) Calling the department of revenue administration’s forms line at (603) 271-2192; or

(4) Writing to:

New Hampshire Department of Revenue Administration

Document Processing Division

PO Box 637

Concord, NH 03302-0637

(e) Tax forms or documents sent by electronic mail or by facsimile shall not be accepted as properly filed documents.

PART Rev 705 PAYMENT OF TAX

Rev 705.01 Mandated Payments.

(a) An operator ordered by the department of revenue administration not to commingle tax funds, shall deposit all tax monies in a bank account in the name of the department in accordance with RSA 78-A:7, II at intervals to be determined by the department at the time of the order.

(b) When, as a result of an administrative hearing, an operator has been ordered to file scheduled estimated payments, the operator shall:

(1) Complete and file form CD-99-ES, “Scheduled Estimated Meals and Rentals Tax”, as described in Rev 708.05; and

(2) Include the required payment.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; amd by Interim #4786, eff 3-21-90; ss by #4889, eff 7-31-90; ss by #5399, eff 5-21-92; ss by #6750, eff 5-19-98; ss by #7505, eff 6-19-01; ss by #8653, eff 6-8-06

Rev 705.02 Conversion of State Funds. Taxes collected shall be the property of the state of New Hampshire and conversion of them to the use of the operator or any other person shall constitute an offense subject to criminal penalty as described in RSA 21-J:39.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; ss by #3181, eff 1-22-86; ss by #4061, eff 5-29-86; ss by #5399, eff 5-21-92; ss by #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 705.03 Use of United States Currency.

(a) The tax shall be calculated and imposed on the consumer using the US dollar as the appropriate currency.

(b) Operators shall remit all taxes collected to the department of revenue administration using the US dollar as the basis for calculating their liability.

(c) Operators shall not remit any foreign currency to the department of revenue administration in payment of their meals and rentals liability for tax, interest or penalties.

Source. #5912, eff 10-14-94; ss by #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 705.04 Payment Procedures for Partial Payments.

(a) Electronic fund transfers for partial payments shall be applied in accordance with the provisions of Rev 2903.05.

(b) Electronic fund transfers for partial payments shall be debited to the operator’s account under the following schedule:

(1) Transfers on timely returns shall be debited on the next business day following the return due date pursuant to RSA 78-A:8, III; and

(2) Transfers on late or amended returns shall be debited on the next business day following the electronic data submission.

Source. #6690, eff 2-21-98; ss by #6750, eff 5-19-98; amd by #6870, eff 10-20-98; ss by #8653, eff 6-8-06

Rev 705.05 Refusal to Pay Tax. If any person liable for tax imposed by RSA 78-A refuses to pay it upon request, the operator shall promptly notify the department of revenue administration in writing that such an offense has occurred.

Source. #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 705.06 Over Collection of Tax by Operators.

(a) Operators over-collecting tax, by any method other than rounding, shall pay the tax over to the state unless verification such as, but not limited to, canceled checks is shown that the tax was returned to the person who originally paid the tax.

(b) Any portion of the tax in (a) above, that is remitted to the state shall be returned to the operator when:

(1) Verification such as, but not limited to, canceled checks is shown that the tax was returned to the person who originally paid the tax; and

(2) Documentation provided supports the original remission of the tax to the State of New Hampshire.

Source. #6750, eff 5-19-98; ss by #8653, eff 6-8-06

PART Rev 706 ADMINISTRATION

Rev 706.01 Taxpayer Records and Information.

(a) Under the authority of RSA 78-A:19, the following information shall be maintained:

(1) Cash receipts;

(2) Sales;

(3) Cash disbursements;

(4) Purchases;

(5) General ledger;

(6) Payroll records;

(7) Complete cash register tapes including the summary and final register reading information;

(8) Guest checks and registration cards;

(9) Rental agreements;

(10) Bank statements with all enclosures for all business and personal accounts;

(11) The meals and rentals tax worksheet required for those operators using telefile;

(12) A printed copy of each of the returns as submitted through the E-file system; and

(13) Any other source documents required to support entries in any accounting records.

(b) The records enumerated in (a), above, may be in a worksheet format provided that such worksheets shall be the basis for the preparation of any financial statements and federal or state tax returns.

(d) Every operator shall provide the commissioner, or his authorized representatives with:

(1) Records; and

(2) Access to key company personnel for interviews, upon request.

(e) If the department of revenue administration determines that the records maintained by the operator are not adequate for the purposes of making an accounting to the state for tax collection liability, it shall:

(1) Determine a tax liability based on any and all available records pursuant to RSA 78-A:11 including physical observation by department of revenue administration personnel of actual sales; and

(2) Deny the operator commission available under RSA 78-A:7, III.

(f) The operator shall maintain separate and distinct records that clearly define taxable versus non-taxable sales.

(g) If such separate records are not maintained, the department of revenue administration shall presume all receipts are taxable unless evidence is presented as to the purchase and sale of nontaxable items.

(h) Evidence, as required by (f), above, shall include:

(1) Vendor invoices showing the purchase price paid by the operator, for the nontaxable items purchased during the audit period;

(2) The beginning and ending inventory amounts for each nontaxable item sold; and

(3) Operator's pricing policies regarding the markup of purchase prices to arrive at the selling price.

(i) The sales value of the nontaxable items purchased and sold based on the evidence provided in (h) above shall be deducted from the total gross receipts of the operator.

(j) Operators using computer systems capable of recreating, upon request, source documents such as, but not limited to, individual guest checks, sales invoices, rental agreements or registration cards shall not be required to maintain the original hard copy of the source document.

(k) Operators using computers incapable of recreating an individual transaction shall maintain the original hard copies.

Source. #2205, eff 12-12-82; ss by #2504, eff 10-12-83; rpld by #3181, eff 1-22-86; ss by #5399, eff 5-21-92; ss by #5912, eff 10-14-94; amd by #6690, eff 2-21-98; ss by #6750, eff 5-19-98; ss by #7505, eff 6-19-01; ss by #8653, eff 6-8-06

Rev 706.02 Confidentiality of Department Records.

(a) All documents and information shall be confidential and shall only be disclosed in conformity with the provisions of RSA 21-J:14.

(b) The department of revenue administration shall only make a disclosure or allow a representative to act on behalf of the operator if:

(1) A properly executed power of attorney form is on file with the department;

(2) The operator authorizes the specific disclosure or actions to be performed by the representative in a letter to the department; or

(3) An authorized employee of the operator is physically present when such disclosure or action is occurring.

(c) For purposes of administering the tax laws of the state, as assigned by statute and pursuant to the federal social security act, 42 USCS sec. 405 (c) (2) (C) (i), operators shall provide their federal identification number or numbers on all tax returns and related documents.

(d) The person having been designated as the power of attorney shall make all records available.

Source. #5912, eff 10-14-94; ss by #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 706.03 Pre-Assessment Conference.

(a) The purpose of an informal pre-assessment conference shall be to discuss the audit findings with the department of revenue administration’s audit division management personnel in an effort to reach an agreement on the issues of fact, audit results, or both.

(b) At the conclusion of an audit when the facts and circumstances of the audit review indicate to the department that an informal pre-assessment conference would benefit both the state and the operator, the department of revenue administration’s audit division shall provide an informal pre-assessment conference for the operator, or his representative.

(c) The department of revenue administration’s audit division shall notify the operator or the authorized representative by mail of:

(1) The date, time and location for the conference; and

(2) The advance information that the operator or the authorized representatives shall be required to provide the audit division.

(d) The information required by (c)(2), above, shall include:

(1) The name, address and identification number of the operator;

(2) An outline of the areas of agreement and disagreement;

(3) Documentation in support of the operator’s position such as:

a. Citations of supporting case law;

b. Statutory or regulatory provisions; and

c. Documents or correspondence from unrelated parties;

(4) Responses to any outstanding questions raised by the auditor during the audit; and

(5) The names of the individuals who shall participate in the conference on behalf of the operator.

(e) Upon completing a review of material provided during the pre-assessment conference, the department of revenue administration’s audit division shall issue a tax notice, notice of refund or no change letter which shall begin the period for formal appeal to the commissioner under RSA 21-J:28-b and Rev 200.

Source. #5912, eff 10-14-94; ss by #6750, eff 5-19-98; ss by #8653, eff 6-8-06

PART Rev 707 APPLICATION OF PENALTIES

Rev 707.01 Substantial Understatement of Tax.

(a) The department shall assess the 25% penalty for understatement of tax provided by RSA 21-J:33-a on returns where the understatement exceeds the greater of 10% of the correct tax liability or $5,000 unless the operator meets one of the following exceptions:

(1) The operator adequately disclosed the relevant facts regarding the tax treatment of the item generating the understatement; or

(2) The operator had substantial authority for its tax treatment of such item.

(b) An operator shall adequately disclose the tax treatment of an item on the return by filing, on or before the due date of the return, a written statement with:

New Hampshire Department of Revenue Administration

Audit Division

PO Box 457

Concord, NH 03302-0457

(1) The operator’s license number;

(2) The tax period affected;

(3) A prominent caption identifying the statement as a disclosure of the tax treatment for the substantial underpayment penalty provided in RSA 21-J:33-a;

(4) Identify clearly the item for which the disclosure is made;

(5) The dollar amount of the item; and

(6) A statement containing those facts affecting the tax treatment of the item that reasonably will apprise the department of the nature of the potential controversy or a concise description of the legal issues presented by the facts in question.

(d) In determining whether an operator has substantial authority, the department shall consider the following as being authoritative sources:

(1) For items applying specifically to the application of the meals and rooms tax:

a. Meals and rooms tax law and any other New Hampshire statutes that have a bearing on the tax statutes;

b. Department rules in effect during that tax period;

c. Declaratory rulings requested by and issued to the operator during that tax period for that item;

d. Technical information releases issued by the department;

e. Superior court and board of tax and land appeals decisions;

f. Federal District Court and First Circuit Court of Appeals decisions;

g. United States and New Hampshire supreme court decisions;

h. Legislative committee reports specifying legislative intent; and

i. Written advice from the department issued to the operator about the tax treatment of the item in question; and

(2) For items in arriving at gross receipts before any state required adjustments:

a. Internal Revenue Code and other statutory provisions;

b. Temporary and final U.S. Department of the Treasury regulations;

c. Federal or state court cases;

d. Internal Revenue Service or U.S. Department of the Treasury administrative pronouncements including revenue rulings and revenue procedures;

e. Tax treaties and related regulations, as well as the U.S. Department of the Treasury's or other U.S. government explanation of such treaties;

f. Congressional intent as reflected in Committee Reports, joint explanatory statements of managers included in the conference committee reports and floor statements made by a bill's managers prior to enactment;

g. Controlling precedent of the United States Court of Appeals to which the operator has a right of appeal;

h. Technical advice memoranda, rulings or determination letters issued by the Internal Revenue Service to the operator or in which the operator is named;

i. An affirmative statement in an Internal Revenue Service revenue agent's report with respect to the operator's prior taxable periods; and

j. Any other source which was accepted by the Internal Revenue Service as substantial authority.

(e) An operator shall have substantial authority for the tax treatment of an item only if the weight of the authorities supporting the treatment of the item by the operator is substantially in relation to the weight of the authorities supporting the position of the department.

(f) The following shall not be considered authoritative sources:

(1) Opinions reached by tax professionals;

(2) Tax publication opinions or narrative statements; and

(3) Articles contained in any professional or tax periodicals.

(g) The existence of substantial authority for a particular item shall be determined as of the date the return containing the item was filed or as of the last day of the taxable period to which the return relates, whichever is later.

(h) The penalty shall be applied to the net understatement determined by reducing the understatement as defined in RSA 21-J:33-a, III by the portion of the understatement for which the operator had substantial authority or had adequately disclosed the position taken in the written statement provided for in (b).

Source. #5912, eff 10-14-94; ss by #6690, eff 2-21-98; ss by #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 707.02 Understatement of Taxpayer's Liability by Tax Preparer.

(a) For purposes of RSA 21-J:33-b, I, "substantial portion" means any instance where the efforts of the tax preparer have affected more than 25% of the operator's tax liability.

(b) An individual or company providing more than typing, reproducing or other mechanical assistance shall be deemed to be a tax preparer when the individual or company uses computer software which makes determinations about the applicability of tax laws or the characterization of income and the allowability of deductions or credits.

(c) The penalty provided in RSA 21-J:33-b, III, shall be assessed when any part of an understatement of tax is the result of a tax preparer's willful neglect or intentional disregard of the statute or departmental rules unless the operator shall have adequately disclosed the tax treatment of an item on the return in a written statement as provided in Rev 707.01(b).

(d) The penalty provided in RSA 21-J:33-b, IV shall be applied when any part of an understatement of tax is the result of a preparer's willful attempt to understate the operator's tax liability.

(e) A tax preparer shall be deemed to have made a willful attempt to understate a tax liability of an operator by:

(1) Disregarding or misstating information furnished by the operator or other person in an attempt to wrongfully reduce the tax liability; or

(2) Not making inquiries of the operator or other person when the information provided is incorrect or incomplete, and the preparer knows or should have known that the information was incorrect or incomplete.

(f) If, in an adjudicative proceeding or a judicial decision it is established that there was no understatement of liability and if previously paid by the preparer, then the penalty imposed by RSA 21-J:33-b shall be abated and refunded.

(g) The refund of the penalty shall be made without any consideration of any period of limitation for the issuance of a refund.

(h) A tax preparer shall be deemed to have acted with willful neglect or intentional disregard when the preparer fails:

(1) To comply with a statutory provision as interpreted in an opinion of the New Hampshire Supreme Court;

(2) To comply with a department rule prescribing the appropriate tax treatment of an item contained in the meals and rentals tax return; or

(3) To follow pertinent statutes, rules or court decisions that address the proper treatment of an item or issue.

Source. #5912, eff 10-14-94; amd by #6690, eff 2-21-98; ss by #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 707.03 Aiding and Abetting an Understatement of Tax Liability.

(a) The penalty provided in RSA 21-J:33-c shall be assessed against any person who aids, assists in, procures or advises in the preparation of any return or other document in connection with the meals and rooms tax or departmental rules if:

(1) The person knows that the information provided will be used in the preparation of any material document; and

(2) The person knows that if used, the information will result in an understatement of tax liability.

(b) The penalty shall not be assessed in instances where the operator adequately disclosed the relevant facts regarding the tax treatment of the item in the manner provided in Rev 707.01(b) and (c).

(c) If in an adjudicative proceeding or a judicial decision it is established that there was no understatement of liability and if previously paid by the preparer, then the penalty imposed by RSA 21-J:33-c shall be abated and refunded.

(d) The refund of the penalty shall be made without any consideration of any period of limitation for the issuance of a refund.

Source. #5912, eff 10-14-94; ss by #6750, eff 5-19-98; ss by #8653, eff 6-9-06

PART Rev 708 MEALS AND ROOMS TAX FORMS

Rev 708.01 Availability of Forms. All forms may be obtained by:

forms, if available;

(b) Calling the department of revenue’s forms line at 603-271-2192; or

(c) Writing to:

New Hampshire Department of Revenue Administration

Document Processing Division

PO Box 637

Concord, New Hampshire 03302-0637

Source. #5912, eff 10-14-94; ss by #6750, eff 5-19-98; ss by #6870, eff 10-20-98; ss by #8653, eff 6-8-06

Rev 708.02 Form DP-14 WS, New Hampshire Meals and Rentals Tax Worksheet.

(a) Form DP-14 WS, “New Hampshire Meals and Rentals Tax Worksheet”, available in the publication of the New Hampshire meals and rentals tax booklet mailed to all licensed operators annually, or as referenced in Rev 708.01, shall be used by an operator to calculate its meals and rentals tax liability.

(b) The operator shall maintain the completed meals and rentals tax worksheets for a minimum of 3 years from whichever of the following is the later date:

(1) The original due date of the first return listed on the worksheet; or

(2) The date the first returned was filed.

(1) Meals and beverages tax receipt calculations providing:

a. Net receipts or net sales for the period excluding tax; and

b. Gross receipts or gross sales for the period including tax;

(2) Receipts from room rentals providing:

a. Total rental receipts;

b. Total permanent resident receipts; and

c. Total taxable rental receipts;

(3) Receipts from motor vehicle rentals;

(4) Commissions as provided by RSA 78:A-8, II;

(5) Deductions, such as:

a. Payments made in advance of the due date for the current tax period; or

b. Credit for which the operator has received a credit memo from the department;

(6) Additions, such as:

a. Interest on tax due not timely paid as provided by RSA 21-J:28;

b. Penalty on tax due not timely paid as provided by RSA 21-J:33; and

c. Penalty on a tax return due not timely filed as provided by RSA 21-J:31; and

(7) Total meals and rentals receipts which are exempt from tax as provided by Rev 702.

Source. #5912, eff 10-14-94; ss by #6690, eff 2-21-98; ss by #6750, eff 5-19-98; ss by #8653, eff 6-8-06

Rev 708.03 Form DP-14, Meals and Rentals Tax Return.

(a) Operators shall complete and file Form DP-14, “Meals and Rentals Tax Return”, with the department in accordance with the provisions of Rev 704.07(b)-(e) by providing:

(1) The business name;

(2) The license number as it appears on the operator’s license issued by the department;

(3) The tax period and due date;

(4) If applicable, an indication that the return is an amended return;

(5) If a final return, an indication of:

a. Whether:

1. The business is being discontinued;

2. There is a change in organization; or

3. The business is being sold; and

b. The last day of business;

(6) The tax excluded and included receipts from the sale of meals and beverages;

(7) The room rental receipts;

(8) Permanent resident receipts;

(9) An indication of the rooms rental tax rate used;

(10) Motor vehicle rental receipts;

(11) An indication of the of the motor vehicle rental tax rate used;

(12) A deduction for any allowable commission, or original return payment, credit memo, or estimated payments;

(13) Interest;

(14) Penalty amount for failure to pay;

(15) Penalty amount for failure to file;

(16) Tax exempt meals and rentals receipts;

(17) A statement declaring:

“Under penalties of perjury, I declare that I have examined the form and to the best of my belief it is true correct and complete. If prepared by a person other than the taxpayer, this declaration is based on all information of which the preparer has knowledge.”; and

(18) Operator’s:

a. Signature and date; and

b. Telephone number; or

(19) Tax preparer’s:

a. Name;

b. Tax identification number; and

c. Address.

(b) A payment to the state of New Hampshire for the total due shall:

(1) Accompany the return; or

(2) Be made electronically.

(c) An operator shall use the Form DP-14 WS, “New Hampshire Meals and Rentals Tax Return” worksheet, described in Rev 708.02 above, to calculate its meals and rentals tax liability.

(d) Final returns shall be filed in hardcopy, not electronically.

(e) Commissions on final returns shall not be forfeited solely due to the return being paper.

(f) An operator shall maintain a copy of Form DP-14, “New Hampshire Meals and Rentals Tax Return” as filed for 3 years.

Source. #5912, eff 10-14-94; ss by #6690, eff 2-21-98; ss by #6750, eff 5-19-98; ss by #7505, eff 6-19-01; ss by #8653, eff 6-8-06

Rev 708.04 Form CD-3, Application for Meals and Rentals Tax Operator's License.

(a) Form CD-3, "Application for Meals and Rentals Tax Operators License", shall be completed and filed by any person applying for a meals and rentals tax license.

(b) A separate Form CD-3 shall be submitted for each license required under Rev 703.01.

(1) The business name;

(2) Entity name;

(3) Physical and mailing address, if different;

(4) The type of organization, as one of the following:

a. Corporation;

b. Partnership;

c. Fiduciary;

d. Proprietorship;

e. Non-profit organization; or

f. Limited liability company;

(5) Federal identification number, or social security numbers, pursuant to RSA 21-J:27-a, Rev 2902.01, Rev 2902.02, and Rev 2902.03, of the business and each individual listed in (b) below;

(6)