Natural Disaster Sales Tax Relief
If your primary residence is damaged or destroyed due to a natural disaster occurring in Tennessee, you may be entitled to a refund of Tennessee sales and use tax paid on major appliances, residential furniture, or residential building supplies purchased after the disaster. For more information, see Important Notice 12-15 and Tenn. Code Ann. § 67-6-396.
Who qualifies for sales tax refunds?
Only people who receive financial assistance from the Federal Emergency Management Agency (FEMA) for the repair, replacement, or construction of their primary home that was damaged or destroyed in a natural disaster may qualify for a refund. In order to receive a refund, that affected person must file a claim with the Department of Revenue.
When should claims be filed?
A claim can be filed up to one year from the date on the FEMA decision letter. A claimant should wait until he or she has made all purchases before filing a claim for refund. Receipts and invoices should be compiled and tracked so that all eligible items purchased after the date of the disaster from all retailers can be submitted at one time.
What items qualify for the sales tax refund?
The Tennessee sales tax paid on eligible items can be refunded. Eligible items are major appliances purchased for $3,200 or less, residential furniture purchased for $3,200 or less, and residential building supplies purchased for $500 or less.
To be eligible, major appliances and residential furniture must be purchased to replace damaged or destroyed items used in the individual’s primary residence. Residential building supplies must be used for the purposes of restoration, repair, replacement, or rebuilding the individual’s primary residence. You can view a detailed list of eligible and ineligible items here.
Is there a limit on the amount of sales tax that can be refunded?
The maximum amount of refund available to any one residence is $2,500.
Can you include sales tax paid by a contractor in the claim?
People filing a claim for refund may also include the Tennessee sales or use tax paid by their contractor on eligible items purchased and used to making repairs to their home. Affected individuals should ask their contractor to provide them with an invoice listing the items purchased and the amount of Tennessee sales tax the contractor paid on those purchases.
What are the steps for claiming a refund of sales tax?
A person can file only one claim for a primary residence. The claim should include all Tennessee sales and use tax paid, up to $2,500, to all retailers for any eligible items. The refund claim should only include eligible items purchased after the date of the disaster. To file a claim for refund, follow these steps:
1. Gather a copy of your FEMA decision letter and all of your receipts and invoices showing payment of Tennessee sales tax on eligible items. Include contractor invoices, if applicable, and any other payment documents if store receipts are not available.
2. You can file your claim for refund electronically in TNTAP by clicking on the File a Natural Disaster Claim for Refund link under the Additional Services heading.
3. However, if you do not want to use the Department’s website, you can also mail the completed Natural Disaster Claim for Refund of Sales Tax form and a copy of your FEMA decision letter to:
ATTN: Natural Disaster Refund Claim
Tennessee Department of Revenue
Andrew Jackson State Office Building
Nashville, TN 37242
Note: Remember to retain the original FEMA decision letter for your records.
4. Keep all receipts and invoices for a period of three years from December 31 of the year in which the claim for refund was filed. Do not send receipts and invoices with the claim for refund. If needed, the Department will request the receipts and invoices.
If a corporation owns rental cabins that were damaged or destroyed in the Sevier County wildfires, can the corporation get a tax refund for items purchased to repair the cabins or replace damaged items in the cabins?
No. Tennessee law allows a refund to individuals for Tennessee sales tax paid on items purchased to repair or replace their primary and/or secondary residence and items in their residence(s) damaged or destroyed as a result of the Sevier County wildfires. Your primary residence is the main place where you live.