Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2016
Sales and Use Tax Annotations
395.0000 OCCASIONAL SALES—SALE OF A BUSINESS—BUSINESS REORGANIZATION—Regulation 1595
(l) SALES BETWEEN PARENT AND SUBSIDIARIES
395.2493 Election Under Federal IRC 338. Under IRC 338, a corporation which makes a "qualified stock purchase" of a target subsidiary corporation may elect to have the target treated as if it (1) sold all of its assets at fair market value in a complete liquidation on the acquisition date and (2) as a new corporation bought all of its assets on the next day at a price determined by the purchasing corporation's basis in the target's stock.
The "deemed" sale of assets provided by IRC 338 does not constitute a "sale" for sales and use tax purposes since only stock certificates were sold. 3/7/86.