Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2017
Sales and Use Tax Annotations
(a) IN GENERAL—DEFINITION
495.0240 Erroneous Entries Transferring Equipment. When entries in a company's books erroneously transferred the company's equipment to another entity, resulting in a sale by mistake, sales tax was due on the transfer despite the mistake because the transferee claimed depreciation of the equipment in the transferee's State and Federal income tax returns. The claim of depreciation constituted an exercise of ownership over the equipment. The transfer could not be considered a nullity and the sales tax could not be cancelled unless the transferee's State and Federal income tax returns were amended to exclude any claim of ownership over the equipment through depreciation deductions and to restore the equipment to where the equipment would have been before the erroneous transfer. 3/17/70.