Tax Type
Retail Sales and Use Tax
Description
Occasional sales, including mergers; Sale of rug was occasional sale
Topic
Taxability of Persons and Transactions
Date Issued
05-07-1998
May 7, 1998
Re: § 58.1-1821 Application: Retail Sales and Use Tax
Dear
This is in response to your letter of February 20, 1998, in which you seek correction of a sales and use tax assessment issued to ******** (the "Taxpayer") for the period November 1991 through October 1997. I note that the entire audit assessment has been paid.
FACTS
The Taxpayer is a physician with an office in Virginia. The only contested transaction is the purchase of a rug. The rug was purchased by the Taxpayer directly from the administrator of an estate in West Virginia. The Taxpayer then transported the rug into Virginia for use in his office.
You maintain that this transaction represents an exempt occasional sale. In this regard, you indicate that the transaction is contemplated in the regulation set out in Title 23 of the Virginia Administrative Code (VAC) 10-210-6010 [formerly Virginia Regulation 630-10-108].
DETERMINATION
Code of Virginia § 58.1-609.10(2) provides an exemption from the Virginia sales and use tax for an occasional sale as defined in Code of Virginia § 58.1-602. That section defines an "occasional sale" as:
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A sale of tangible personal property not held or used by a seller in the course of an activity for which he is required to hold a certificate of registration, including the sale or exchange of all or substantially all the assets of any business and the reorganization or liquidation of any business, provided such sale or exchange is not one of a series of sales and exchanges sufficient in number, scope and character to constitute an activity requiring the holding of a certificate of registration.
The department addresses this statute in 23 VAC 10-210-6010 as it applies to sales by the administrator of an estate. The regulation indicates that a personal representative may sell the household goods and other personal effects of a decedent under the occasional sale exemption provided that an auctioneer is not engaged to sell the property.
The Taxpayer in the instant case purchased an item directly from the administrator of an estate. This purchase was made in connection with an exempt occasional sale pursuant to the Virginia statute and regulation noted above. Accordingly, this transaction will be removed from the assessment. Because the assessment has been paid in full, a refund will be issued to the Taxpayer as shown on the attached calculations.
Please contact******** in the department's Office of Tax Policy at ********* if you have any questions regarding this letter.
Sincerely,
Danny M. Payne
Tax Commissioner
OTP/13681I
Rulings of the Tax Commissioner