(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.

Terms Used In Tennessee Code 67-6-394

  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • Business: includes occasional and isolated sales or transactions of aircraft, vessels, or motor vehicles between corporations and their members or stockholders and also includes such transactions caused by the merger, consolidation, or reorganization of corporations. See Tennessee Code 67-6-102
  • Dealer: means every person, as used in this chapter, including Model 1, Model 2, and Model 3 sellers, where the context requires, who:
    (A) Manufactures or produces tangible personal property for sale at retail, for use, consumption, distribution, or for storage to be used or consumed in this state. See Tennessee Code 67-6-102
  • Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
  • Person: includes any individual, firm, co-partnership, joint venture, association, corporation, estate, trust, business trust, receiver, syndicate, any governmental agency whose services are essentially a private commercial concern, or other group or combination acting as a unit, in the plural as well as the singular number. See Tennessee Code 67-6-102
  • required capital investment: means an increase of a business investment in real property, tangible personal property or computer software owned or leased in the state, valued in accordance with generally accepted accounting principles. See Tennessee Code 67-6-102
  • Sale: includes the furnishing of any of the things or services taxable under this chapter. See Tennessee Code 67-6-102
  • Sales price: includes consideration received by the seller from third parties, if:
    (i) The seller actually receives consideration from a party other than the purchaser, and the consideration is directly related to a price reduction or discount on the sale. See Tennessee Code 67-6-102
(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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