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2017 Tennessee Code
Title 67 - Taxes and Licenses
Chapter 6 - Sales and Use Taxes
Part 3 - Exemptions
§ 67-6-394. Credit for sales tax due on a transaction accommodation fee included in a sale or lease.
Universal Citation: TN Code § 67-6-394 (2017)
- (a) A credit shall be granted, in the manner provided in subsection (b), for the amount of the sales tax due on a transaction accommodation fee included in the sales price of a sale or the gross proceeds of a lease.
- (b) The credit shall apply such that sales tax is owed on the sales price or gross proceeds, less the transaction accommodation fee associated with such sale or lease.
- (c) For purposes of this section, the following definitions shall apply:
- (1) "Full-time employee" means a permanent, rather than seasonal or part-time, employee who is normally scheduled to work at least thirty-seven and one half (37.5) hours per week, and receives minimal healthcare, as described in title 56, chapter 7, part 22;
- (2) "Qualified motor vehicle manufacturer" means a producer, as defined in § 55-17-123(b)(2), that has made the required capital investment within the investment period necessary to qualify for the credit provided in § 67-4-2109(b)(2)(B)(i), or one of its related business entities;
- (3) (A) "Related business entity" means a business entity:
- (i) In which the qualified motor vehicle manufacturer, directly or indirectly, has more than thirty-five percent (35%) ownership interest;
- (ii) That, directly or indirectly, has more than thirty-five percent (35%) ownership interest in the qualified motor vehicle manufacturer; or
- (iii) In which a person described in subdivision (c)(3)(A)(ii), directly or indirectly, has more than thirty-five percent (35%) ownership interest;
- (B) For purposes of this subdivision (c)(3), a noncorporate entity is more than thirty-five percent (35%) owned, if, upon liquidation, more than thirty-five percent (35%) of the assets of the noncorporate entity, directly or indirectly, accrue to the entity having the ownership interest; and
- (4) "Transaction accommodation fee" means the standard charge made by a franchised motor vehicle dealer to a qualified motor vehicle manufacturer in consideration for selling or leasing a motor vehicle produced by the qualified manufacturer to one (1) of the qualified manufacturer's full-time employees. Records documenting the amount of the standard transaction accommodation fee shall be maintained by the dealer in accordance with § 67-6-523.
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