ALABAMA DEPARTMENT OF REVENUE
SALES, USE & BUSINESS TAX DIVISION
SALES & USE TAX RULE
810-6-1-.22. Barter, Exchange, Trade-In.
(1) Except as outlined in paragraph (2), the money value allowed for property
received and exchanged for other property constitutes payment or partial payment of the
purchase price and must be included in the measure of the sales or use tax.
(2) Exceptions to the general rule are:
- (a) The agreed value placed on automotive vehicles, truck trailers,
semitrailers, or house trailers taken in trade on sales of other automotive vehicles,
truck trailers, semitrailers, or house trailers. On so called "trade-ups" this allowance
shall not exceed the sales price of the vehicles sold by the dealer. (Sections
40-23-2(4) and 40-23-61(c))
- (b) Exchanges of cottonseed for cottonseed meal at or by gins. (Sections
40-23- 4(6) and 40-23-62(9))
- (c) The agreed value placed on any used part including tires of
an automotive vehicle, truck trailer, semitrailer, or house trailer
taken in trade as a credit or part payment on
the sale of a new, used or rebuilt part or tire, for an automotive vehicle,
truck trailer, semitrailer or house trailer; provided, however, this provision
shall not include batteries. (Section 40-23-2(1))
- (d) The agreed value placed on any machine, machinery, or equipment
used in planting, cultivating, and harvesting farm products or used in
connection with the production of agricultural produce or products, livestock
or poultry on farms taken in trade on the sale of other farm machines, machinery,
or equipment. (Section 40-23-37)
(3) Property received as a "trade-in" or received in barter or exchange
for other property is subject to tax, when resold, at the full resale price.
(Amended June 12, 1978, amended August 8, 1982, readopted through APA effective
October 1, 1982, amended April 3, 1987, amended July 9, 1998)
Numeric Index