Utah State Tax Commission
Withholding Tax Workshop
- Section 7 – Closing or Changing License
If a business moves, changes its name, or ceases to do business, the owners need to notify the Tax Commission so the license can be updated. A Notice of Change form, TC-96C is available in the withholding tax coupon booklet.
This form can be used to conveniently report any of the following changes, or to correct inaccuracies in your identification number, name or address as shown on the booklet.
- Change in mailing address
- Change in business address
- Change in business name
- Business discontinued or ceased paying wages
- Other (attach explanation)
If you sell a business or change the ownership status, you must close the existing license and apply for a new license. The existing tax number is not transferable, the new owner/entity cannot use the number or report withholding taxes on the coupons of the previous owner/entity. The following conditions require application for a new license number:
- Business is sold
- The ownership status changes or the Federal ID number changes
- from a sole proprietorship to a partnership or corporation
- from a partnership to a corporation or a sole proprietorship
- from a corporation to a sole proprietorship or partnership
If you purchase a business you need to be aware of an area of the tax code called "Successor Liability." Under successor liability if the seller of a business does not file returns and pay the taxes due, the buyer can be held liable for the seller's unpaid taxes. To protect yourself from this liability you need to:
- Review the seller's tax records
- Place into an escrow account enough funds from the purchase price to cover all unpaid taxes
- Only release the escrow funds when the seller provides you with copy of a tax clearance letter from the Utah State Tax Commission stating that all returns have been filed and no taxes are due
