WILLIAM DONALD SCHAEFER, Governor                         Ch. 589

(ii) a sale of tangible personal property if the buyer intends to:

1.       resell the tangible personal property in the form that the
buyer receives or is to receive the property;

2.       use or incorporate the tangible personal property in a
production activity as a material or part of other tangible personal property to be
produced for sale;

3.       consume the tangible personal property directly and
predominantly in a production activity by destroying, using up, or wearing out the
property, other than through obsolescence, to the extent that the property cannot be
rendered fit for further use in a production activity, if the consumption occurs within 1
year after the property is first used in a production activity; or

4.       transfer the tangible personal property as a part of a taxable
service transaction; or

(iii) a sale of a taxable service if the buyer intends to resell the taxable
service in the form that the buyer receives or is to receive the service.

(k) (1) "Use" means an exercise of a right or power to use, consume, possess, or
store that is acquired by a sale for use of:

(i) tangible personal property; or

(ii) a taxable service.

(2)     "Use" includes an exercise of a right or power to use, consume, possess,
or store that is acquired by a sale for use of tangible personal property:

(i) for use or resale in the form of real estate by a builder, contractor,
or landowner; or

(ii) except as provided in paragraph (3)(i) of this subsection, as
facilities, tools, tooling, machinery, or equipment, including dies, molds, and patterns,
even if the buyer intends to transfer title to the property before or after that use.

(3)     "Use" does not include:

(i) a transfer of title to tangible personal property after its use as
facilities, tools, tooling, machinery, or equipment, including dies, molds, and patterns, if:

1.       at the time of purchase, the buyer is obligated, under the
terms of a written contract, to make the transfer; and

2.       the transfer is made for the same or greater consideration to
the person for whom the buyer manufactures goods or performs work;

(ii) an exercise of a right or power over tangible personal property
acquired by a sale for use if the buyer intends to:

1. resell the tangible personal property in the form that the
buyer receives or is to receive the property;

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