Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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535.0000 SUCCESSOR'S LIABILITY—Regulation 1702

Annotation 535.0073.090

535.0073.090 Service Business. A taxpayer is engaged in a trucking business. He also has a truck selling business for which he has a Department of Motor Vehicles license and a seller's permit. He disposes of used trucks from the trucking business in this selling operation. Substantially all of the assets of the trucking business and the truck selling business are exchanged for first issue stock, the assumption of a liability, and a note.

The taxpayer has incurred a large tax liability primarily from ex-tax out-of-state truck purchases used in the trucking business. The assets of the trucking sales business, which are transferred involve $50,000 of the total consideration. Those of the trucking business represent $5.9 million of the purchase price. The successor corporation's successor liability is limited to the $50,000 related to the trucking business.

The purchase price related to the transfer of the service business is not subject to the successor liability provisions of sections 6811 and 6812. 3/16/90.