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442.0000 Publishers—Regulation 1543

Annotation 442.0870

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442.0870 Transfer of Text and Artwork. A taxpayer was a writer of educational periodicals. The taxpayer entered into an agreement with a producer to compile and coordinate research, information, original artwork, photographs and mechanical art necessary for production of a series of related illustrated books. The agreement specifically provided that the taxpayer was not responsible for color separations, stripping or printing. The taxpayer was authorized to hire artists and to make purchases as necessary. The agreement provided that the publisher would own all original artwork and photography commissioned by the taxpayer, and that the petitioner would act as agent of the publisher in making purchases of art.

Since the taxpayer was an agent of the publisher in obtaining artwork, he is not regarded as selling artwork to the publisher. Also, under Regulation 1543, the transfer of manuscripts is not taxable. Accordingly, tax did not apply to any charges made by the taxpayer to the publisher. 7/12/94.