(a) Sales exempt. A taxable item that is sold or purchased by way of an occasional sale is exempt from sales and use taxes, except as provided by subsection (i) of this section.
(b) Occasional sales by persons not in the business of selling, leasing, or renting.
(1) One or two sales of taxable items, other than an amusement service, during any 12-month period by a person who does not hold himself out as engaged (or who does not habitually engage) in the business of selling taxable items are occasional sales.
(2) The third sale of a taxable item in a 12-month period by a person not previously in the business of selling, leasing, or renting taxable items causes that person to become a retailer. Tax must be collected and reported on the third sale and all subsequent sales unless the sale qualifies for exemption under paragraph (4) of this subsection or subsection (d) or (e) of this section. If three or more sales are made in a 12-month period, then the person must obtain a permit. See §3.286 of this title (relating to Seller's and Purchaser's Responsibilities, including Nexus, Permits, Returns and Reporting Periods, and Collection and Exemption Rules). Example: A lump-sum contractor sells a backhoe in October, a typewriter in December and a crane in February. The contractor has not sold, leased or rented any construction equipment prior to the sale of the backhoe; therefore, the contractor can sell the backhoe and typewriter tax free as occasional sales. The sale of the crane is the third sale within 12 months from the sale of the back-hoe. The sale of the crane is not an occasional sale. The contractor must obtain a permit, collect tax on the sale of the crane and, until an intervening 12 months have passed between sales, all subsequent sales of taxable items.
(3) The sale of not more than ten admissions for amusement services during a 12-month period by a person who does not hold himself out as engaged (or who does not habitually engage) in the provision of amusement services are occasional sales.
(4) The sale of tangible personal property by an individual is an occasional sale if:
(A) the property was originally purchased by the individual or a member of the individual's family for either of their personal use;
(B) the individual does not hold a sales tax permit and is not required to hold a sales tax permit;
(C) the sale is not made through the use of an auctioneer, broker, or factor, other than an online auction; and
(D) the total receipts from such sales do not exceed $3,000 in a calendar year. If the total receipts from the individual's sales of such tangible personal property exceed $3,000 in a calendar year, the individual must obtain a sales tax permit and collect tax on all sales of taxable items in this state, beginning with the first sale which causes the total receipts to exceed $3,000.
(5) The exemption provided under subsection (b) of this section does not apply to a rental or lease of a taxable item.
