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BTLG Table of Contents > Sales and Use Tax Annotations > S > 495.0000 Sale > Annotation 495.0736.850

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S

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495.0000 Sale

Annotation 495.0736.850

(d) Transfers Between Related Legal Entities

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495.0736.850 Transfer of Depreciable Assets to Subsidiary—No Consideration. A Parent Company plans to transfer some depreciable assets (furniture, fixtures, machinery and equipment) to its wholly owned subsidiary. The Parent has paid sales tax reimbursement or use tax when purchasing this property. The Parent will receive no consideration from the subsidiary for the property. A transfer of tangible personal property for which no consideration is given for the property is not a sale or purchase. Therefore, no sales or use tax would apply to the transaction if no consideration, such as assumption of Parent's liability by the subsidiary, an intercompany debt, the cancellation of indebtedness, or Parent's receipt of additional shares in the subsidiary, is provided by the subsidiary in exchange for obtaining ownership in the property. 5/9/96.