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BTLG Table of Contents > Sales and Use Tax Annotations > O > 395.0000 Occasional Sales > Annotation 395.2058

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

Annotation 395.2058

(j) Mergers and Reorganizations

(1) Mergers

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395.2058 De Facto Merger. In a statutory merger, the transfer of property is by operation of law and is not regarded as a sale. Thus, no sales tax applies. (Regulation 1595(b)(3).) In a de facto merger, however, the property is not transferred by operation of law, but rather by contract in exchange for consideration. Such a transfer in a de facto merger is a sale and is subject to tax, unless prequalifying for exemption under sections 6281 or 6367. 6/24/65.