Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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410.0000 PERMITS—Regulation 1699

Annotation 410.0198


410.0198 Predecessor Liability. A husband and wife were co-owners of a coffee service that sold cups and spoons. A determination was issued for the period of January 1, 1982 through January 15, 1983. The wife stated that she had no personal liability for the debts. Documentation submitted by the wife disclosed that she and her husband were separated on September 22, 1980 and filed for divorce proceedings, on December 11, 1980. On March 10, 1981, as part of the divorce proceeding, the court ordered the business transferred to the husband personally. The actual transfer of the business was accomplished on November 6, 1981. The notice of partnership dissolution was not published until March 30, 1982, which was also the date of the final decree of divorce. The seller's permit was revoked on September 24, 1981, for failure to pay a delinquent liability. The husband paid the delinquency plus a reinstatement fee on November 17,1981, and the permit was reinstated. The husband signed the reinstatement application as "co-owner," so the Board's records continued to show the entity as a husband/wife co-ownership.

While the permit was inactive, the wife had transferred her interest in the business to her husband. Eleven days later, the husband reinstated the permit. There is nothing in the record to indicate that the wife had actual or constructive knowledge that the husband reinstated the predecessor permit rather than obtaining a new permit in his own name. Lacking such knowledge, the wife cannot be held liable as a predecessor. 4/13/89.