Ohio § 5739.012

§ 5739.012.

(A) As used in this section: (1) “ Bundled transaction ” means the retail sale of two or more products, except real property and services

to real property, where the products are otherwise distinct and identifiable products

and are sold for one non-itemized price.  “Bundled transaction” does not include the sale of any products in which the sales

price varies, or is negotiable, based on the selection by the consumer of the products

included in the transaction. As used in division (A)(1) of this section: (a) “Distinct and identifiable products” does not include any of the following: (i) Packaging, including containers, boxes, sacks, bags, and bottles, and packaging materials,

including wrapping, labels, tags, and instruction guides that accompany the retail

sale of the products and are incidental or immaterial to the retail sale thereof; (ii) A product provided free of charge with the required purchase of another product.  A product is provided free of charge if the sales price of the product purchased

does not vary depending on the inclusion of the product provided free of charge. (iii) Items included in the definition of “price” under division (H) of section 5739.01 of the Revised Code . (b) “One non-itemized price” does not include a price that is separately identified by

product on binding sales or other supporting sales-related documents made available

to the consumer in paper or electronic form, including, but not limited to, an invoice,

bill of sale, receipt, contract, service agreement, lease agreement, periodic notice

of rates and services, rate card, or price list. (2) “ De minimis ” means the vendor's or seller's purchase price or sales price of taxable products

is ten per cent or less of the total purchase price or sales price of bundled products.  Vendors and sellers shall use either the purchase price or the sales price of the

products to determine if the taxable products are de minimis, and shall use the full

term of a service contract to determine if the taxable products are de minimis.  Vendors and sellers shall not use a combination of the purchase price and sales

price of the products to determine if the taxable products are de minimis. (B) A transaction that otherwise meets the definition of a bundled transaction is not

a bundled transaction if it is any of the following: (1) A retail sale of tangible personal property and a service where the tangible personal

property is essential to the use of the service, and is provided exclusively in connection

with the service, and the true object of the transaction is the service; (2) A retail sale of services where one service is provided that is essential to the

use or receipt of a second service, the first service is provided exclusively in connection

with the second service, and the true object of the transaction is the second service; (3) A transaction that includes taxable products and nontaxable products, and the purchase

price or sales price of the taxable products is de minimis; (4) A retail sale of exempt tangible personal property and taxable tangible personal

property where the transaction includes food and food ingredients, drugs, durable

medical equipment, mobility enhancing equipment, over-the-counter drugs, prosthetic

devices, or medical supplies, and the vendor's or seller's purchase price or sales

price of the taxable tangible personal property is fifty per cent or less of the total

purchase price or sales price of the bundled tangible personal property.  Vendors and sellers may not use a combination of the purchase price and sales price

of the tangible personal property when making the fifty per cent determination for

a transaction. (C) In the case of a bundled transaction that includes telecommunications service, ancillary

service, internet access, or audio or video programming service: (1) If the price is attributable to products that are taxable and products that are nontaxable,

the portion of the price attributable to the nontaxable products shall be subject

to tax unless the provider, by reasonable and verifiable standards, can identify the

portion from its books and records that are kept in the regular course of business

for other purposes, including, but not limited to, non-tax purposes. (2) If the price is attributable to products that are subject to tax at different tax

rates, the total price shall be treated as attributable to the products subject to

tax at the highest tax rate unless the provider can identify by reasonable and verifiable

standards the portion of the price attributable to the products subject to tax at

the lower rate from its books and records that are kept in the regular course of business

for other purposes, including, but not limited to, non-tax purposes. (D) In all other cases of bundled transactions, the taxability of the transaction shall

be determined by the true object of the consumer entering into the transaction.