Under the Noodles & Company agreement, who is responsible for tax liabilities allocated to the buyer?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
You will promptly pay all federal, state and local taxes arising out of the operation of your business. We will not be liable for these or any other taxes and you herby do and will indemnify us for any such taxes that may be assessed or levied against us which arise or result from your business. You shall reimburse us for any sales tax, gross receipts tax, use tax or other tax or assessment imposed by any taxing authority in the state where the Restaurant is located on any fees or other amounts payable to us under this Agreement. Such taxes are distinguishable from income taxes imposed on us by the jurisdiction in which the Restaurant is located. Such income taxes are our responsibility.
Source: Item 23 — RECEIPT (FDD pages 99–350)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, the franchisee is responsible for all taxes arising from the operation of their business. Noodles & Company will not be liable for any federal, state, or local taxes related to the franchisee's business.
Specifically, the franchisee must indemnify Noodles & Company for any taxes assessed or levied against them that arise from the franchisee's business. This includes reimbursing Noodles & Company for any sales tax, gross receipts tax, use tax, or other assessments imposed by taxing authorities on fees or other amounts payable to Noodles & Company under the Franchise Agreement.
The document clarifies that these taxes are distinct from income taxes imposed on Noodles & Company, which remain the responsibility of Noodles & Company. This section of the agreement ensures that franchisees understand their tax obligations and protects Noodles & Company from liabilities related to the franchisee's operations.