Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2014
 

Sales and Use Tax Annotations


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395.0000 OCCASIONAL SALES—SALE OF A BUSINESS—BUSINESS REORGANIZATION—Regulation 1595

Annotation 395.0100

(b) ACTIVITIES REQUIRING PERMIT—PROPERTY HELD OR USED IN

395.0100 Assumption of Contingent Liabilities. A transferor, required to hold a California Seller's Permit, transfers less than 80% of the tangible personal property held or used in the course of said activities. Contingent liabilities, such as Deferred Taxes, Early Retirement Program and Warranty Liability, that have been accrued for financial statement purposes, were included in the transfer.

Since it is probable that future events will occur confirming the fact of the contingent liabilities, and the liabilities were accrued in accordance with generally accepted accounting principles, the transferee's assumption of the liabilities is consideration given for the assets that are transferred. 8/5/93.