North Carolina shareholders were “engaged in business” with lease.

The shareholders of a corporation in North Carolina that purchased heavy equipment and then leased it back to the corporation were considered “engaged in business” because rent payments were taken and tangible personal property was maintained for the purpose of a lease or rental. It was important to this particular situation that the transactions only involved select customers. It was the regularity of the transactions that was at issue and prohibits them from being considered an “isolated or occasional sale”. (Administrative Decision No. 382, North Carolina Tax Review Board, June 4, 2002)

Posted on March 15, 2003