Laws, Regulations and Annotations

Search

BTLG Table of Contents > Sales and Use Tax Annotations > A > 100.0000 Advertising Agencies, Commercial Artists And Designers > Annotation 100.0158

Sales and Use Tax Annotations

A    B    C    D    E    F    G    H    I    J    L    M    N    O    P    R    S    T    U    V    W    X   

---

A

---

100.0000 Advertising Agencies, Commercial Artists and Designers—Regulation 1540

Annotation 100.0158

(c) Preliminary and Finished Art

---

100.0158 Packaging Design Transfer. A taxpayer designed packaging for various types of products. By agreement with its clients, the taxpayer developed and presented to its clients a selection of preliminary package design concepts which were done at the taxpayer's expense and at no cost to the clients. Upon acceptance of the design by the client, the client obtained the exclusive right, title and ownership interest to the design concepts prepared by the taxpayer. At all times it was contemplated the taxpayer would transfer title to the design concepts to the client. The client's true object was the obtaining of the preliminary design package. The transactions were therefore retail sales of tangible personal property. Even if the design package is viewed as preliminary art, tax applies because title to the design packages was passed to the clients. 2/15/95.