Residential Wood Heating Fuel Exemption

November 28, 2023


New York exempts retail sales of wood used for residential heating purposes from the state sales tax. The law also permits local governments (municipalities and counties) to grant an exemption from local sales taxes. If a city with a population of 1 million or more chooses to grant the local exemption, it must enact a specific resolution that appears in the state law. Local sales tax rates in New York range from 1.5% to more than 4% in addition to the general state sales tax rate of 4%. For buildings with both residential and non-residential units where more than 25% of the space is used for non-residential purposes, an allocation must be made between the amount of fuel used for residential purposes and that used for non-residential purposes.  The non-residential portion remains subject to the state sales tax.

This exemption also applies to natural gas, propane (sold in containers of 100 pounds or more), electricity, steam, fuel oil (except diesel motor fuel), and coal.

The New York Department of Taxation and Finance publishes a variety of sales tax reports detailing local tax rates and exemptions, including those for residential energy services. The residential energy services sales tax list (Publication 718-R) is updated frequently.

Program Overview

Implementing Sector: State
Category: Financial Incentive
State: New York
Incentive Type: Sales Tax Incentive
Web Site:
Administrator: New York State Department of Taxation and Finance
Start Date:
Eligible Renewable/Other Technologies:
  • Biomass
Incentive Amount: 100% exemption


Name: NYCL Tax § 1105-A
Date Enacted: 1978


Name: Taxpayer Assistance - Sales Tax Information Center
Organization: New York State Department of Taxation and Fin
Address: W.A. Harriman Campus
Albany NY 12227
Phone: (518) 485-2889

This information is sourced from DSIRE; the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University.