1. (a) The sales and use tax does not apply to a casual and isolated sale by a person who regularly does not sell tangible personal property, a digital code, a digital product, or a taxable service if:

   1. (1) the sale price is less than $1,000; and
   2. (2) the sale is not made through an auctioneer or a dealer.

2. (b) The sales and use tax does not apply to a distribution of tangible personal property, a digital code, or a digital product by:

   1. (1) a corporation or joint-stock company to its stockholders as a liquidating distribution;
   2. (2) a partnership to a partner; or
   3. (3) a limited liability company to a member.

3. (c)

   1. (1) The sales and use tax does not apply to a transfer of tangible personal property, a digital code, or a digital product:

      1. (i) under a reorganization within the meaning of § 368(a) of the Internal Revenue Code;
      2. (ii) on organization of a corporation or joint-stock company, to the corporation or company principally in consideration for the issuance of its stock;
      3. (iii) to a partnership only as a contribution to its capital or in consideration for a partnership interest in the partnership; or
      4. (iv) to a limited liability company only as a capital contribution or in consideration for an interest in the limited liability company.

   2. (2) For a transfer that would qualify as a casual and isolated sale under subsection (a) of this section if the sale price limitation were disregarded, the amount of liability transferred to or assumed by a corporation, joint-stock company, partnership, or limited liability company shall be excluded from the consideration transferred by the corporation, joint-stock company, partnership, or limited liability company in exchange for the tangible personal property, digital code, or digital product to determine whether the transfer is made:

      1. (i) principally in consideration for the issuance of stock of a corporation or joint-stock company;
      2. (ii) only as a contribution to the capital of a partnership or in consideration for a partnership interest; or
      3. (iii) only as a capital contribution to a limited liability company or in consideration for an interest in a limited liability company.

Added by Acts 1988, c. 2, § 1, eff. Jan. 1, 1989. Amended by Acts 1992, c. 536; Acts 1994, c. 3, § 1, eff. Feb. 28, 1994; Acts 2021, c. 669, § 1, eff. May 30, 2021.

Formerly Art. 81, §§ 326, 326A, 375.