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  3. Dean Baldwin Painting Inc.

Dean Baldwin Painting Inc.



The Department conducted a field audit of the taxpayer, which is in the business of painting airplanes.  The auditor found that the taxpayer had not reported or had inappropriately deducted receipts from sixteen customers.  The Department subsequently assessed the taxpayer for additional gross receipts tax, penalty and interest.  The taxpayer protested, claiming that it was entitled to the deduction provided under § 7-9-57 for sales to out of state buyers.  The facts established, however, that all aircraft painted by the taxpayer were flown in and out of the taxpayer’s New Mexico facility by employees of the customer.  Based on this evidence, the hearing officer found that both delivery and initial use of the painted aircraft occurred in New Mexico.  The taxpayer’s protest was denied.