Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2014
Sales and Use Tax Annotations
100.0000 ADVERTISING AGENCIES, COMMERCIAL ARTISTS AND DESIGNERS—Regulation 1540
(c) PRELIMINARY AND FINISHED ART
100.0160 Preliminary Art. A company enters one or more concepts into a computer and gives the client a laser print proof of the layout(s). Whichever layout is chosen is refined and proofed (with laser print-outs) until it is "perfect". At that time, the company obtains signed final approval to have it printed on a high resolution printer. When a designer uses a computer to prepare art, the designer must abide by the provisions of the regulation in order to consider any part of the charge nontaxable preliminary art. The designer produces a rough design in physical form which could be identified as preliminary art when the "laser print proof" of the layout is produced. The taxpayer should have the client initial and date approval of that design or have other similar evidence to show that the proofs were produced prior to the date of the contract or approval for finished art. 12/14/92.