On September 28, 2016, the Department assessed the Taxpayer, as a successor in business for the tax periods from December 31, 2014 through July 31, 2016. On December 19, 2016, the Taxpayer filed a formal protest with the Department. On or about August 1, 2016, the Taxpayer, who is a landlord, took over operations of a restaurant that was rented by a tenant that had become delinquent on rent, taxes, and other business expenses. The Taxpayer retained all of the employees that were employed by the prior owner and assumed possession of perishable and non-perishable items from the prior owner. The issue to be determined during this hearing is if the tax liability from the prior owner of the restaurant transfers to the Taxpayer after the default and eviction. Both the prior owner and the taxpayer are limited liability companies (LLC) with a shared member. The property that is transferred or acquired by a LLC is property belonging to the LLC and not of the LLC’s members. For the purpose of this hearing, the Hearing Officer notes that the LLC’s shall be treated as separate and district entities apart from their members. During the hearing, the Hearing Officer went through the eight factors that are used to determine if a business is a successor. These eight factors are presented in Regulation 18.104.22.168(A) NMAC. The Hearing Officer determined that six of the eight factors established that the Taxpayer was a successor in business. However, the time frame that the Department could go back would be limited based on Section 7-1-63(C), NMSA 1978. The Hearing Officer determined that the Taxpayer’s liability may be capped by an amount that is equal to the full value of the transferred tangible and intangible property based on the facts in this protest. The Department is ordered to abate part of the tax assessed. For the forgoing reasons, the Taxpayer’s protest is partially granted and partially denied.