Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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Annotation 295.0200


295.0200 Customer-Furnished Equipment Included in Sales Contract. If a customer delivers the bill of sale for equipment owned by him to a dealer who sells new equipment to the customer under a sales contract, and the proceeds from the finance company in excess of the price of the new equipment are remitted to the customer, the sales tax applies only to the price of the new equipment. The customer's property included in the sales contract provides the finance company with additional security and it is not in any realistic sense sold by the dealer to the customer. Since the sales contract, as reported to the finance company, is sought to be disregarded, the dealer should keep sufficient documentary evidence to show the actual facts. 12/26/58.