Sales of Items at Public Auctions Generally do not Qualify for the Isolated or Occasional Sales and Use Tax Exemption in Utah

Utah Administrative Code
Tax Commission
Title R865. Auditing
Rule R865-19S. Sales and Use Tax
Current through August 5, 2012
R865-19S-38. Isolated or Occasional Sales and Use Tax Exemption Pursuant to Utah Code Ann. Section 59-12-104

(1) "Isolated or occasional sales and use tax exemption" means a sale that qualifies for the sales and use tax exemption for the sale of tangible personal property by a person:
(a) regardless of the number of sales of that tangible personal property by that person; and
(b) not regularly engaged in the business of selling that type of property.
(2)(a) Except as provided in Subsection (2)(b), sales made by officers of a court, pursuant to court orders, qualify for the isolated or occasional sales and use tax exemption.
(b) Sales made by trustees, receivers, or assignees in connection with the liquidation or conduct of a regularly established place of business do not qualify for the isolated or occasional sales and use tax exemption.
(c) Examples of sales made by officers of a court pursuant to court order, that qualify for the isolated or occasional sales and use tax exemption are sales made by sheriffs in foreclosing proceedings and sales of confiscated property.
(3) If a business regularly sells a type of property, sales of that type of property do not qualify for the isolated or occasional sales and use tax exemption, even if the primary purpose of the business is not the sale of that type of property. For example, the sale of repossessed radios or refrigerators by a finance company do not qualify for the isolated or occasional sales and use tax exemption.
(4)(a) Except as provided in Subsection (4)(b), sales of vehicles required to be titled or registered under the laws of this state do not qualify for the isolated or occasional sales and use tax exemption.
(b) The transfer of a vehicle where the ownership of the vehicle before and after the transfer is at least 80 percent the same qualifies for the isolated or occasional sales and use tax exemption.
(5) Sales that qualify for the isolated or occasional sales and use tax exemption include sales that occur as part of:
(a) the reorganization, sale, or liquidation of a business so long as those sales do not include items purchased exempt from sales tax as a sale for resale;
(b) a garage sale if:
(i) the person selling the items at the garage sale is not regularly engaged in selling that type of property; and
(ii) the items sold at the garage sale were not purchased exempt from sales tax as a sale for resale; and
(c) the sale of business assets that are:
(i) not purchased sales tax exempt by the business as a sale for resale; and
(ii) a type of property not regularly sold by the business.
(6) An example of a sale that qualifies for the sales and use tax exemption under Subsection (5)(a) is a sale, even if it is one of a series of sales, to liquidate the fixtures and equipment of a manufacturing company.
(7) Examples of sales that qualify for the sales and use tax exemption under Subsection (5)(c) include the sale by a:
(a) grocery store of its cash registers, shelves, and fixtures;
(b) law firm of its furniture; and
(c) manufacturer of its used manufacturing equipment.
(8) Sales of items at public auctions generally do not qualify for the isolated or occasional sales and use tax exemption.