Texas Comptroller Affirms Excise, Sales Tax Assessment Against Business Successor for Fraudulent Business Acquisition

The Texas Comptroller of Public Accounts Nov. 6, 2023 affirmed an Administrative Law Judge’s (ALJ) decision holding Taxpayer liable for sales and use and excise tax as a successor to a company that operated a sexually oriented business. Taxpayer operated the business at the same location as its predecessor using the predecessor’s business name and inventory. Taxpayer requested a redetermination. The ALJ found: 1) Taxpayer didn’t obtain a receipt from the comptroller showing that the predecessor’s tax liabilities had been paid; 2) the predecessor’s tax liability was final and unpaid when the assessment against Taxpayer was made; 3) Taxpayer didn’t ...