Laws, Regulations & Annotations

Business Taxes Law Guide – Revision 2018

Sales and Use Tax Annotations

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545.0000 "TAX-PAID PURCHASES RESOLD"—Regulation 1701

Annotation 545.0010

545.0010 Brokerage Sales of Vehicles. An automobile broker, who is a licensed dealer under section 285 of the Vehicle Code, is in the business of finding cars for customers at franchised dealers and then selling them to its customers. On occasion, dealers require the broker to pay sales tax and register the vehicle in the name of the broker.

Under this scenario, the broker may take a "tax-paid purchase resold" deduction if it makes no use of the vehicle prior to selling it to its customer. 11/25/91.