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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 395.2044
(i) Transfers and Contributions to New Corporation or Partnership
395.2044 Transfer of Unexpired Portion of Lease. Assets are being transferred to a commencing corporation solely in exchange for the first issue of stock. No transferor debt is being assumed by the commencing corporation, except that the unexpired portion of certain real property leases are being assigned to the commencing corporation to enable it to conduct business on those premises.
Although the assumption of contingent liabilities is consideration for the transfer of tangible personal property, where the transferee incurs a liability which will arise after the transfer and is for benefits received by the transferee after the transfer, there has been no transfer of liabilities within the meaning of Regulation 1595(b)(4). 3/1/94.