Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2013
Sales and Use Tax Annotations
395.0000 OCCASIONAL SALES—SALE OF A BUSINESS—BUSINESS REORGANIZATION—Regulation 1595
(k) DISSOLUTION; LIQUIDATION; DISTRIBUTION OF ASSETS
395.2325 New Partnership. A partnership and an unrelated person form a new partnership. The old partnership contributes the assets of the partnership and the unrelated person contributes other assets to the new partnership. The new partnership assumes the liabilities of the old partnership. The assumption of liabilities constitutes consideration for the assets transferred and tax applies.
Should the individual partners of the old partnership claim that the partnership assets were first distributed to them as individuals and were then contributed to the new partnership, and at the same time maintain that the new partnership is assuming the old partnership liabilities, tax would still apply. The Board would not recognize that a dissolution has occurred since a dissolution would require that the partnership liabilities be paid. 3/8/60.