Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2013
 

Sales and Use Tax Annotations


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

Annotation 395.1252

(f) SALE OF A BUSINESS GENERALLY

395.1252 Sales Price of Fixtures and Equipment. The buyer and seller signed an executory contract for the sale of the business. The agreed purchase price was placed in escrow and the buyer took possession of the business. Under these conditions, the sale of the business has occurred.

While the purchase price remained in escrow, the buyer filed a complaint in superior court seeking reformation of the contract and rescission, alleging that the equipment furnished was not suitable for use in the business and requesting that the court reduce the purchase price to reflect the true value of the business. It has been held that sales and use taxes are properly computed on the agreed upon sales price of tangible personal property and a subsequent "adjustment" of the sales price as part of a settlement of litigation does not entitle a taxpayer to a refund of any portion of the initially computed sales or use tax. 4/22/93.