Publication 256, Lumber Products and Engineered Wood Products
- Assessment Table
- Consumers and Construction Contractors
- Additional Information
Beginning January 1, 2013, purchases of lumber products and engineered wood products for use in California are subject to a one percent (1%) assessment based on the selling price of the products. This publication provides information to retailers in applying the assessment to your sales of specific materials, how to properly charge your customer and how to report and pay the Board of Equalization (BOE). This publication also provides information on how to report and pay on purchases of these materials from out of state.
You can report your purchase(s) on our website at www.boe.ca.gov by selecting New Registration, and then select Pay use tax and/or the lumber products assessment on one time purchase. Once you have registered, you may pay any amounts due by filing your return. You can also register to report amounts due in person at any of our field offices.
Retailers of lumber products and engineered wood products are required to:
- Collect the 1% assessment on sales of lumber products and engineered wood products to California consumers.
- State the amount of the 1% assessment as a separate item on your sales receipt. The separately stated amount is not subject to sales or use tax. The assessment may be designated on the sales receipt as “lumber products assessment,” “LPA,” “lumber assessment,” “lumber fee,” or “lumber.”
- File electronically and pay the assessment to the BOE on your sales and use tax return.
Reporting and paying the assessment
Retailers of lumber products and engineered wood products are required by law to electronically report and pay the assessment to us. We automatically update the electronic filing status of retailers that we are able to identify as selling lumber products and engineered wood products to include an assessment schedule as part of your sales and use tax return.
If you are a retailer of lumber products and engineered wood products and your account has not been updated to include the assessment schedule with your sales and use tax return, please call our Customer Service Center at 1-800-400-7115.
If your account was updated to include the assessment schedule and you are not a retailer of lumber products and engineered wood products, please contact our Customer Service Center at 1-800-400-7115.
If you are one of the 2 percent of retailers that do not currently electronically file your return, our registration program provides you with a more convenient method of filing. You may register to file your return and pay the assessment on our website at www.boe.ca.gov by selecting New Registration, and then select Pay use tax and/or the lumber products assessment on one time purchase. Once you have registered, you can pay any use tax due by filing your return. You can also register to report use tax in person at any of our field offices.
Sales not subject to the assessment
In general, the assessment is not due on the following sales:
- Sales for resale. In a sale for resale, the purchaser is not regarded as purchasing the lumber product or engineered wood product for their own use in this state.
- Sales in interstate commerce. Sales made by a retailer in California but shipped directly to customers outside of California.
- Sales to the U.S. government.
- Sales involving Native American Indians follow the same rules as the sales and use tax law. Please see Regulation 1616, Federal Areas, and publication 146, Sales to American Indians and Sales in Indian Country.
Reimbursement for startup costs
If you were in business selling lumber products and engineered wood products prior to January 1, 2013, you may offset your reported assessment amounts for certain costs incurred to begin collecting the assessment. You may retain $250 per business location as reimbursement for one-time startup costs associated with the collection of the assessment. Please see Regulation 2000, Retailer Reimbursement Retention, for guidance on the reimbursable costs.
A business location means a location registered under your seller's permit as of January 1, 2013, where retail sales of lumber products or engineered wood products are made.
Beginning January 1, 2014, lumber retailers that were in business selling lumber products or engineered wood products before January 1, 2013, may retain an additional $485 per business location as reimbursement for their start-up costs. Please see Regulation 2001, Additional Allowed Retailer Reimbursement Retention.
To claim the additional start-up cost, beginning with returns due on or after January 1, 2014, enter your allowable additional reimbursement cost ($485 per business location) on your lumber schedule in the “Reimbursement Cost Offset” box. Remember, you may only enter a reimbursement amount up to your total reported lumber products assessment per each return. Any remaining allowable reimbursement cost must be taken on subsequent returns as an offset to reported lumber products assessment amounts, including any allowable start-ups costs you may have remaining from 2013 ($250 per business location).
If you are eligible for the additional $485 in start-up costs but closed out your business or no longer sell lumber products or engineered wood products subject to the 1 percent (1%) assessment, you may file a claim for refund for lumber products assessment amounts paid in 2013 up to $485 per business location. You may only claim a refund up to the lumber products assessment amounts paid in 2013. You may use a BOE-101, Claim for Refund or Credit, to file a claim for refund (see publication 117, Filing a Claim for Refund).
Note: This publication summarizes the law and applicable regulations in effect when the publication was written, as noted above. However, changes in the law or in regulations may have occurred since that time. If there is a conflict between the text in this publication and the law, decisions will be based on the law and not on this publication.
The Board of Forestry and Fire Protection (BOF) is responsible for determining the products that are subject to the lumber products assessment. See the Board of Forestry, Emergency Regulation to Implement Lumber Products Assessment. The BOF is required to annually update their regulation.
In general, lumber products and engineered wood products subject to the assessment are building products usually used in construction in which wood is at least 10 percent (10%) of total content. For example, all dimensions and grades of lumber, roofing, (shakes and wooden shingles), siding, lath, plywood, particle board, fiberboard, oriented strand board, I-joists, laminated veneer lumber, veneer-based sheeting material, and inorganic-bonded and wood thermoplastic composites, including plastic lumber and decking.
Based on guidance provided by the BOF the lumber products assessment does not apply to products where labor has added ‘significant value’’ to them, such as:
- decorative products such as wainscoting, paneling, molding or baseboards that have added profiling, patterns, chamfering or other craftsmanship.
However, the addition of any value to a lumber product does not automatically result in a product not subject to the assessment. Many lumber products undergo additional processing before being used, but are still subject to the assessment; for example, lumber that is graded and planed. In addition, engineered wood products, which are subject to the assessment, have been, by definition, processed or manufactured from raw materials. Thus, it is important to consult the BOF’s Emergency Regulations when trying to determine if a product is subject to the Lumber Products Assessment.
The Board of Forestry provides additional information on its website in a document entitled Guidance for classifying products under the Lumber Assessment. This document is intended to provide guidance in determining the products that are subject to the Lumber Products Assessment and does not have the same effect of the law. In instances where there is an inconsistency between the guidance and the law, the law is controlling.
|Subject to Assessment||Not Subject to Assessment|
|Solid Wood Products|
Fencing (poles, solid board)
Roofing (shakes and wooden shingles)
Siding (beveled shingles, board and batten, log, tongue and grove, treated wood)
Engineered Wood Products
Laminated strand lumber
Laminated strand lumber with painted finish
Laminated veneer lumber
Oriented strand board
Oriented strand lumber
Parallel strand lumber
Veneer-based sheeting material
Inorganic-bonded and wood thermoplastic composites
Cement-bonded composite materials
Ceramic-bonded composite materials
Gypsum-bonded composite materials (fiber reinforced gypsum)
Wood thermoplastic composite materials including plastic lumber and decking
LP Smartside products
|Bark or cork products
Carvings and craft products
Cooperage and treatment materials (including staves, storage
vessels, and oak chips for wine, beer or sprits)
Indoor finished flooring products such as hardwood (solid or engineered)
Millwork (window casings, baseboards)
Plywood hole covers
Pre-constructed fencing sections
Pre-constructed railing sections
Sporting goods and equipment
Tools, tool handles
The Board of Forestry and Fire Protection (BOF) is required to annually update the regulations pertaining to lumber products and engineered wood products, to identify the types of products subject to the assessment. For more information about products subject to the assessment, visit the BOF website at http://bof.fire.ca.gov.
Consumers and Construction Contractors
If you purchase lumber products and engineered wood products for use in California and do not pay the 1 percent (1%) assessment to a California retailer or you purchase these products from outside of California for use in this state, you are required to report and pay the assessment directly to the BOE.
Construction contractors who purchase lumber products and engineered wood products that will be consumed in the performance of a construction contract in California must pay the assessment either to the retailer upon purchase or directly to the BOE.
When you purchase lumber products and engineered wood products for resale, you are responsible for collecting the assessment at the time of sale and reporting and paying the amounts due to the BOE.
If you purchase lumber and engineered wood products to produce items to sell at retail (for example, lumber products to make prefabricated cabinets), you may purchase the products for resale and their purchase is not subject to the assessment.
In addition, the subsequent sale of products that you have manufactured, assembled, processed or produced from the lumber products and engineered wood products is not subject to the assessment (see Definitions and Assessment Table, for products not subject to the assessment).
How a consumer can pay the 1 percent (1%) assessment to the BOE
If you are a consumer of lumber products and engineered wood products and do not currently hold a seller’s permit, you may register with us to report and pay the 1% assessment online at our website at www.boe.ca.gov by selecting New Registration, and then select Pay use tax and/or the lumber products assessment on one time purchase. Once you have registered, you can pay any use tax due by filing your return. You can also register to report use tax in person at any of our field offices. Please contact our Customer Service Center for assistance at 1-800-400-7115.
For additional information about construction contractors, see publication 9, Construction and Building Contractors.
For additional information, go online at www.boe.ca.gov to view our frequently asked questions (FAQ’s) regarding the lumber products and engineered wood products assessment. Or if you have questions regarding the assessment, please call 1-800-400-7115 (TTY:711), Monday through Friday 8:00 a.m. to 5:00 p.m. (Pacific time), excluding state holidays, to speak to a customer service representative.
California Code of Regulations, Title 14
1667.2 Timber Regulation and Forest Restoration Fund
1667.4 Assessed Lumber Products
1667.5 Requests for Review
1667.6 Annual Update of Regulation
California Code of Regulations, Title 18
2000 Retailer Reimbursement Retention
2001 Additional Allowed Retailer Reimbursement Retention
Sales and Use Tax Regulation
1616 Federal Areas
9 Construction and Building Contractors
117 Filing a Claim for Refund
146 Sales to American Indians and Sales in Indian Country
159 Online Filing Guide