Form Pub. Ks-1526 - Kansas Business Taxes For Motor Vehicle Transactions Page 28
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44K.A.R. 92-19-30. Motor vehicles or trailers; isolated or
(g) K.S.A. 79-3603(o), and amendments thereto, which imposes
occasional sale. (a)(1) An isolated or occasional sale of motor
sales tax on isolated or occasional sale of trailers and motor
vehicle or trailer is a sale made between private individuals or
vehicles, excepts the following transfers or sales from the tax
other entities who, at the time of the sale, are not retailers registered
imposition on these isolated or occasional sales:
to collect and remit sales or use tax on the sale of such a vehicle or
(1) Transfers by an individual to a corporation solely in exchange
trailer.
for stock in the corporation;
(2) Kansas motor vehicle dealers and trailer dealers are retailers
(2) transfers from one corporation to another corporation when
and cannot make isolated or occasional sales of vehicles or trailers.
done as part of the transfer of all the corporate assets; and
These dealers shall collect sales tax at the time of the sale on each
(3) sales of automobiles, light trucks, trailers or motorcycles
taxable retail sale of a motor vehicle or trailer.
between immediate family members.
(b)(1) Unless a sale is one that is excepted from the imposition
(h) “Immediate family member” is any person in a class that is
of sales tax by K.S.A. 79-3603(o) or exempted from tax under K.S.A.
defined by statute to mean lineal ascendants and descendants
79-3606, and amendments thereto, sales tax shall be levied on the
and their spouses. Since a person may have lineal ascendants
isolated or occasional sale of a motor vehicle or trailer. Tax on the
and descendants and may also be the spouse of someone who
isolated or occasional sale of a motor vehicle or trailer shall be
has lineal ascendants and descendants, this class includes the
paid to the county treasurer when the purchaser or other transferee
grandfather, grandmother, father, mother, son, daughter, and
applies for a certificate of title or a certificate of title and registration
adopted child of the person; the spouses of these ascendants and
or to the director of taxation, as provided in paragraph (c)(3).
descendants; the grandfather, grandmother, father, mother, son,
(2) When a person who has acquired a vehicle in an isolated or
daughter, and adopted child of the person’s spouse; and any other
occasional sales transaction applies for a certificate of title or
ascendants and descendants that are further removed, including
certificate of title and registration, the county treasurer shall collect
great-grandparents and great-grandchildren. The sale or transfer
the sales tax that is due along with a service fee of 50 cents, and
of an automobile, light truck, trailer or motorcycle between members
give the applicant a receipt for the tax and fee paid. A certificate of
of this class shall be exempt from sales tax.
title or certificate of title and registration shall not be issued until the
(i) Certain transfers of motor vehicles or trailers are not sales,
transferee pays the tax and applicable fee or proves to the
as defined in paragraph (f)(1), and shall not be taxed. These include
satisfaction of the county treasurer or the director of taxation that the
name changes, transfers by gift, and certain transfers made by
transfer is not taxable.
operation of law. The following rules shall apply to these transfers.
(c)(1) County treasurers shall be assisted by the director of
(1) A transfer shall be presumed to be a gift when the transferee
taxation or director of vehicles in determining whether or not a
is the spouse, mother, father, brother, sister, child, grandmother or
transaction is taxable or exempt. Refusal to issue a certificate of
grandfather, aunt, uncle, niece, or nephew of the transferor and
title or certificate of title and registration for a vehicle may be
money is not exchanged for the vehicle. A gift shall also be presumed
requested by the director of taxation or director of vehicles until
when these relatives trade or exchange vehicles and money is not
sales tax is paid. Sales tax shall be collected by a county treasurer
exchanged as part of the trade or exchange. However, if money is
if any doubt exists as to an applicant’s exemption claim. An applicant
exchanged for the vehicle, the transfer shall be taxable, unless the
who pays sales tax may file a refund claim with the director of
sale is exempted as set forth in subsection (h).
taxation if the applicant believes the tax has been erroneously
(2) A vehicle transfer by gift is not a sale and shall not be taxed.
collected by county treasurer or department of revenue.
To qualify as a gift, the vehicle shall be given without any
(2) Each determination made by a county treasurer to exempt an
consideration and with an intention on the part of the donor that the
isolated or occasional sale may be reviewed by the director of
transfer is a gift. When the relationship of the parties is not one of
taxation. Following this review, a sales tax assessment may be
the relationships set forth above in paragraph (i)(1), the transferee
issued to the vehicle registrant for any sales tax that is unpaid or
claiming the transfer is a gift shall submit proof of this claim to the
underpaid because of clerical error, misinformation, or other cause.
satisfaction of the county treasurer or director of taxation.
(3) Any sales tax that is finally determined to be due under an
(3) The change of an owner’s name on the title when there is no
assessment shall be paid to the director of taxation. Payment of
actual transfer of vehicle ownership to a different person or entity is
sales or use tax on isolated or occasional sales of motor vehicles
not a sale and shall not be taxed. However, the transfer of a motor
or trailers may be made to the director of taxation instead of the
vehicle or trailer from a corporation to an individual shall be taxed
county treasurer, as provided in paragraph (b)(1), to correct any
since there is a change of ownership from one legal entity to another.
other underpayment or as an accommodation to the taxpayer.
The vehicle transfer shall be presumed to be the corporation’s
(d) As a general rule, the base for computing the tax shall be the
payment of a wage, dividend, bonus, or other benefit to the officer,
actual selling price of the vehicle. However, the tax shall be
employee, shareholder, or other transferee.
computed on the fair market value of the vehicle by the county
(4) A transfer to an heir or legatee by will or pursuant to the
treasurer or the director of taxation under either of the following
inheritance or intestacy laws of a state is not a sale and shall not be
circumstances:
taxed. A certified copy of the probate court order making the
(1) The selling price of the vehicle is unknown; or
distribution shall be filed with the county treasurer.
(2) the stated selling price is not indicative of, and bears no
(5) The sale to a person who takes title to a vehicle with the
reasonable relationship to, the fair market value of the vehicle or the
intention of transferring it to the winner of a drawing or raffle shall
average retail value as shown in the latest publication of the national
be taxed. The subsequent transfer of the vehicle to the winner of a
automobile dealers’ association official used car guide book.
drawing or raffle is a gift from the donor to the winner and shall not
(e) The actual selling price shall be the base for computing the
be taxed. When a donor pays a motor vehicle dealer for a vehicle
tax on the sale of wrecked or damaged vehicles.
and the vehicle is transferred from the dealer directly to the winner
of a drawing or raffle, the gift is considered to be the payment made
(f)(1) “Sale” or “sales” means the exchange of property, a sale
for money, and every other transaction in which consideration is
for the automobile rather than the automobile itself, and the winner
given, whether conditional or otherwise.
shall be liable for the sales tax that is charged by the dealer on the
vehicle sale. Whenever a vehicle is won as a prize and sales tax
(2) “Vehicle” means motor vehicle or trailer.
has not been paid by either the vehicle donor or vehicle winner to
(3) “Transferor” means the seller, donor, or other person who
this state or another state, the winner shall pay Kansas sales or
sells, gives away, or otherwise parts with the vehicle.
use tax when the vehicle is registered with the county treasurer.
(4) “Transferee” means the purchaser, donee, or other person
(6) When the title to a vehicle is transferred to the holder of an
who purchases, is given, or otherwise acquires ownership of the
encumbrance as a result of repossession under the terms of a
vehicle.
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