Did a weekly broker bulletin listing real estate offered for exchange qualify as an exempt newspaper or periodical?

Plain-English summary

A redacted organization of real-estate brokers interested in exchanging property issued a weekly Exchange Bulletin. Associate Tax Counsel answered its absent December 1, 1965 letter.

Members paid $60 per year for the bulletin and could publish 20 lines of exchange listings in each issue.

California classified the bulletin as an advertising medium used to notify member brokers about available exchange property. It did not qualify as a newspaper or periodical, so California sales to brokers were taxable.

Source and live-annotation limits

The official 385.1600 PDF does not include the December 1 request, organization or member identities, Exchange Bulletin or any issue, property or listing, publication or delivery schedule, subscription agreement or payment, evidence of the 20-line entitlement, price allocation, invoices, California sales or uses, returns, exemption documentation, tax calculations or payments, audit, assessment, claim, appeal, or later outcome. The organization, brokers, properties, transactions, and amounts beyond the stated subscription price are redacted or unidentified.

The source prints memberbrokers without a space. The original-text section preserves that form. The live annotation preserves the title, real-estate exchange listings, advertising-medium conclusion, section 6362, date, and nonperiodical result. It omits the request, organization E and its members, weekly schedule, $60 annual subscription, 20 listing lines per issue, California-broker sales and taxable result, missing records, redactions, source form, and absent outcome.

What this means for you

Broker organizations, listing publishers, and tax professionals

A regular weekly schedule did not establish periodical treatment where staff found that the publication functioned as member advertising. Preserve every issue and listing, publication and delivery schedule, membership and subscription terms, listing entitlements, price allocations, invoices and sales, returns, exemption documents, tax calculations, and payments.

Common questions

Q: How often was the bulletin issued?

A: Weekly.

Q: What did the $60 annual subscription include?

A: The bulletin and 20 lines of property-exchange listings in each issue.

Q: Why was it taxable?

A: California treated it as an advertising medium rather than a newspaper or periodical.

Q: Did the live annotation include the subscription arrangement?

A: No. The supporting opinion states the $60 annual price and 20-line listing entitlement.

Citations and references

• Former California Revenue and Taxation Code § 6362
• December 1 request, bulletin and issues, listings, memberships, subscriptions, California sales, tax records, and outcome — described or implicated but not documented

Verbatim support

From the official Associate Tax Counsel opinion:

Members of "E" may subscribe to the bulletin for $60 per year and they are entitled to the publication of 20 lines of listings of real estate for exchange in each issue.

The Exchange Bulletin is an advertising medium published for the purpose of notifying memberbrokers of property available for exchange.

Accordingly, sales of the Exchange Bulletin to brokers in this state are subject to sales tax.

Source

• Annotated Legal Opinions collection: CDTFA Annotated Legal Opinions
• Annotation page: Annotation 385.1600
• Original supporting opinion: 385.1600 PDF

Original ruling text

385.1600

STATE OF CALIFORNIA

STATE BOARD OF EQUALIZATION

December 15, 1965

Gentlemen:
This is in reply to your letter of December 1, 1965 regarding the Exchange Bulletin, a publication issued weekly by "E", an organization of real estate brokers interested in exchanging real estate. The bulletin contains listings of real estate which brokers offer for exchange. Members of "E" may subscribe to the bulletin for $60 per year and they are entitled to the publication of 20 lines of listings of real estate for exchange in each issue. The Exchange Bulletin is an advertising medium published for the purpose of notifying memberbrokers of property available for exchange. Under such circumstances, it is our opinion that the Exchange Bulletin does not qualify as a newspaper or periodical under Section 6362 of the Revenue and Taxation Code. Accordingly, sales of the Exchange Bulletin to brokers in this state are subject to sales tax.

Sincerely yours,

George A. Trigueros
Associate Tax Counsel

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