Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2017
Sales and Use Tax Annotations
395.0000 OCCASIONAL SALES—SALE OF A BUSINESS—BUSINESS REORGANIZATION—Regulation 1595
(f) SALE OF A BUSINESS GENERALLY
395.1253 Service Business. A taxpayer sold substantially all of its assets to a nonrelated entity. Prior to the sale of assets, the taxpayer operated a business which stored records, documents, and other boxed papers for its clients. The taxpayer made a monthly charge per box for storage. The taxpayer made limited sales of storage boxes to its clients and held a seller's permit for this activity. Approximately 99 percent of its revenue was from its storage business.
The storage business itself was a service business. Its customers could rent a storage place without purchasing boxes and purchasers of boxes never receive a reduced storage rate. Under the specific facts in this case, the taxpayer operated a service enterprise and made separate and incidental sales as discussed in Regulation 1595(a)(5)(A). Accordingly, only the sale of assets used in conjunction with the sale of boxes is subject to tax. 11/9/93.