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BTLG Table of Contents > Sales and Use Tax Annotations > O > 395.0000 Occasional Sales > Annotation 395.1900

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

Annotation 395.1900

(i) Transfers and Contributions to New Corporation or Partnership

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395.1900 Incorporation of Sole Proprietorship. The transfer of a sole proprietorship's assets and liabilities in return for all the capital stock of a commencing corporation was not taxable because the transaction was an occasional sale under section 6006.5(a), if the assets sold were not held or used by the sole proprietor in the course of an activity for which a seller's permit was required and if the sale was not one of a series sufficient in number, scope, and character to constitute an activity for which a seller's permit was required, or under section 6006.5(b) if the assets sold were held or used by the sole proprietor in the course of an activity for which a seller's permit was required, because all the assets were transferred and because the ownership of the assets remained the same as that which existed before the transfer. 10/8/69.