Texas Codes

Tex. Tax Code § 321.002 (2026)

Definitions

✓ current as of May 2026

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Sec. 321.002. DEFINITIONS. (a) In this chapter:

(1) "Additional municipal sales and use tax" means only the additional tax authorized by Section 321.101(b).

(2) "Municipality" includes any incorporated city, town, or village.

(3)(A) "Place of business of the retailer" means an established outlet, office, or location operated by the retailer or the retailer's agent or employee for the purpose of receiving orders for taxable items and includes any location at which three or more orders are received by the retailer during a calendar year. A warehouse, storage yard, or manufacturing plant is not a "place of business of the retailer" unless at least three orders are received by the retailer during the calendar year at the warehouse, storage yard, or manufacturing plant.

(B) An outlet, office, facility, or any location that contracts with a retail or commercial business to process for that business invoices, purchase orders, bills of lading, or other equivalent records onto which sales tax is added, including an office operated for the purpose of buying and selling taxable goods to be used or consumed by the retail or commercial business, is not a "place of business of the retailer" if the comptroller determines that the outlet, office, facility, or location functions or exists to avoid the tax legally due under this chapter or exists solely to rebate a portion of the tax imposed by this chapter to the contracting business. An outlet, office, facility, or location does not exist to avoid the tax legally due under this chapter or solely to rebate a portion of the tax imposed by this chapter if the outlet, office, facility, or location provides significant business services, beyond processing invoices, to the contracting business, including logistics management, purchasing, inventory control, or other vital business services.

(C) Notwithstanding any other provision of this subdivision, a kiosk is not a "place of business of the retailer." In this subdivision, "kiosk" means a small stand-alone area or structure that:

(i) is used solely to display merchandise or to submit orders for taxable items from a data entry device, or both;

(ii) is located entirely within a location that is a place of business of another retailer, such as a department store or shopping mall; and

(iii) at which taxable items are not available for immediate delivery to a customer.

(b) Words used in this chapter and defined by Chapter 151 have the meanings assigned by Chapter 151.

Added by Acts 1987, 70th Leg., ch. 191, Sec. 1, eff. Sept. 1, 1987. Amended by Acts 2003, 78th Leg., ch. 1155, Sec. 1, eff. Sept. 1, 2003.

Amended by:

Acts 2009, 81st Leg., R.S., Ch. 1360 (S.B. 636), Sec. 4, eff. September 1, 2009.

Acts 2011, 82nd Leg., R.S., Ch. 942 (H.B. 590), Sec. 1, eff. September 1, 2011.

Acts 2013, 83rd Leg., R.S., Ch. 1361 (S.B. 1533), Sec. 1, eff. September 1, 2013.

Notes of Decisions

Cited in 8 cases (5 in the last 5 years), 2009–2025 · leading case: Combs v. City of Webster, 311 S.W.3d 85 (Tex. App. 2010).

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Combs v. City of Webster, 311 S.W.3d 85 (Tex. App. 2010). · cites it 2× “See Tex. Tax Code Ann. § 321.002 (a)(3). However, the statute plainly states that the definition of place of business "includes any location at which three or more orders are received by the retailer during a calendar year.”

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). · cites it 9× “Tex. Tax Code § 321.002(a)(3)(A). The statute further deﬁnes what a place of business of the retailer is not.”

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). · cites it 9× “Tex. Tax Code § 321.002(a)(3). The Legislature has never deﬁned the terms “receives,” “order,” “employee,” or “agent” in the statutory scheme.”

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). · cites it 5× “Tab B C — Texas Tax Code § 321.002 . . . . . . . . .”

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). “Tex. Tax Code § 321.002(a)(3)(A). The Comptroller has never asserted that that definition is ambiguous or deficient, and yet, subsection (a)(18) of Rule 3.”

Susan Combs, in Her Off. Capacity as Comptroller of Pub. Accounts for the State of Texas v. City of Webster, Webster Econ. Dev. Corp., City of Denton, City of Humble, City of Lewisville, City of Mesquite, City of North Richland Hills, City of Plano, City of Waco, Denton Cnty. Transp. Auth. (Tex. App. 2009). “See Tex. Tax Code Ann. § 321.002 (a)(3). However, the statute plainly states that the definition of place of business "includes any location at which three or more orders are received by the retailer during a calendar year.”

Susan Combs, in Her Off. Capacity as Comptroller of Pub. Accounts for the State of Texas v. City of Webster, Webster Econ. Dev. Corp., City of Denton, City of Humble, City of Lewisville, City of Mesquite, City of North Richland Hills, City of Plano, City of Waco, Denton Cnty. Transp. Auth. (Tex. App. 2009). “See Tex. Tax Code Ann. § 321.002 (a)(3). However, the statute plainly states that the definition of place of business “includes any location at which three or more orders are received by the retailer during a calendar year.”

— Tex. Tax Code § 321.002(a)(3) — 1 case

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). “Tex. Tax Code § 321.002(a)(3). The Legislature has never deﬁned the terms “receives,” “order,” “employee,” or “agent” in the statutory scheme.”

— Tex. Tax Code § 321.002(a)(3)(A) — 5 cases

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). “Tex. Tax Code § 321.002(a)(3)(A). The statute further deﬁnes what a place of business of the retailer is not.”

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). “Tex. Tax Code § 321.002(a)(3). The Legislature has never deﬁned the terms “receives,” “order,” “employee,” or “agent” in the statutory scheme.”

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). “Tab B C — Texas Tax Code § 321.002 . . . . . . . . .”

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). “Tex. Tax Code § 321.002(a)(3)(A). The Comptroller has never asserted that that definition is ambiguous or deficient, and yet, subsection (a)(18) of Rule 3.”

— Tex. Tax Code § 321.002(a)(3)(B) — 2 cases

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). “Tab B C — Texas Tax Code § 321.002 . . . . . . . . .”

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). “Tex. Tax Code § 321.002(a)(3)(A). The statute further deﬁnes what a place of business of the retailer is not.”

— Tex. Tax Code § 321.002(a)(3)(C) — 1 case

City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; & City of Farmer's Branch, Texas // Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas v. Kelly Hancock, in His Off. Capacity as Acting Comptroller of Pub. Accounts of the State of Texas // City of Coppell, Texas; City of Humble, Texas; City of DeSoto, Texas; City of Carrollton, Texas; City of Farmer's Branch, Texas; & City of Round Rock, Texas (Tex. App. 2025). “Tex. Tax Code § 321.002(a)(3)(A). The statute further deﬁnes what a place of business of the retailer is not.”

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