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Business Taxes Law Guide—Revision 2024

Sales and Use Tax Annotations


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395.0000 Occasional Sales—Sale of a Business—Business Reorganization—Regulation 1595

Annotation 395.0673

(c) Series of Sales—"Number, Scope and Character"


395.0673 Sale of Assets. A corporation, engaged in the business of selling computer hardware, computer software and computer services, made a close-out sale of its business assets. The corporation claimed that it had always been primarily engaged in the business of computer programming and that the hardware sales were initially intended only as a way to finance the acquisition of equipment for use in the programming business. Therefore, it believes that the computer hardware and software, used solely in the consulting or programming business, were assets not held or used in an activity requiring a seller's permit and the sale of these assets qualifies as an exempt occasional sale.

The corporation was engaged in the business of selling computer hardware and software and the final sale of assets was also computer hardware and software. The corporation had made a series of sales of computer hardware sufficient in number, scope and character to require the holding of a seller's permit. The close-out sale was merely another step in this series and does not qualify as an exempt occasional sale. Accordingly, the sale of the assets is taxable and it is not necessary to decide whether the company was primarily engaged in a separate consulting or programming activity. 6/6/91.