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Asset transfers

We have a business thaat operates from locations in CA, FL and Canada.From time to time we will ship some of our expensive test equipment from one location to another to be used on engineering projects for customer designs. These projects may last from a week to six months. because of the insurance and cost of shipment, we dont ship the test equipment back to its home location immediately, but keep it where last used until it is needed again, and then it it is shipped to that location.

For the equipment purchase initially in CA or Canada, we have paid the sales or use tax. Is anyone aware of any tax issues that could arise from segregation of owneship and use in other states on loaned assets that have already been subject to tax in the home state? 

Answers

Topic Expert
Barrett Peterson
Title: Senior Manager, Actg Stnds & Analysis
Company: TTX
(Senior Manager, Actg Stnds & Analysis, TTX) |

The principal issues you may encounter are custom duties for cross-border moves like those between Canada and the U.S., and nexus issues arising from use in states in which you currently do not have a physical presence.

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