I live in Illinois, but I buy some materials from WENSCO in Iowa, who never charges sales tax, and from Standard in St. Louis, MO who always charges me sales tax. ( I don't have a tax exempt agreement with either one of them!
When I buy products over the internet I never pay sales tax. Bought a Wacom Table and a ink jet printer...never paid a sales tax with those items.
So, What gives? I have asked my suppliers to explain and they don't seem to have an answer.
Also, I am being taxed by one supplier on a SERVICE AGREEMENT and I don't think I have ever in my life had to pay tax for a "service plan" on anything I buy here in Illinois, (like at Best Buy).
What is your experience on this subject. Thanks!
If you are a "merchant" here at Letterville, do you charge sales tax for out of state buyers? Whats the law?
------------------ Draper The Signmaker Bloomington Illinois USA Stop in and visit a while! 309-828-7110 signman@davesworld.net Raptorman or Draper_Dave on mIRC chat
[This message has been edited by Dave Draper (edited February 20, 2001).]
Posts: 2883 | From: Bloomington Illinois USA | Registered: Nov 1998
| IP: Logged |
posted
some companies have sale tax charges in your state....if they have a distribution center in your state......if they have only one center and its out of state they do not charge sales tax....ex. ameriban..they charge sales tax, but have a warehouse in fl even thou the # you call is in kansas...gregory...has only the warehouse in illonis so i get stuff from them without tax charged...
------------------ joe pribish-A SIGN MINT 2811 longleaf Dr. pensacola, fl 32526 850-944-5060 BEWARE THE TRUTH.....YOU MAY NOT LIKE WHAT YOU FIND
Posts: 11582 | From: pensacola, fl. usa | Registered: Nov 1998
| IP: Logged |
OP's right. And, you really should get a federal tax ID number so they don't have to charge you a sales tax regardless of where you live. It just makes good business sense.
Posts: 10691 | From: Wilson, NC, USA | Registered: Nov 1998
| IP: Logged |
Dana Aaron
unregistered
posted
Just a little word of warning on purchasing equipment out of state and not being charged sales tax for your state...
I had something come up - I bought my plotter and sign program out of TX and my computer out of CA, so I didn't pay sales tax on either one.
When it came time to submit my MN sales and use tax... well, my accountant let me know if I was going to depreciate the equipment on my biz taxes, I had to remit the MN sales tax amount on the equipment I purchased out of state!! Geez, just what I needed in February was to come up with an extra several hundred bucks!!
He also said that it worked that way on items purchased in a state that charged less % sales tax. For example... If I had gone out of state to buy a computer, and paid 4% sales tax, and MN sales tax is 6.5% - I would then have to remit 2.5% tax (the difference) when submitting my sales & use tax payment.
Better check with your accountant as to what the deal is in your state. And I don't know how this works with materials purchased out of state, since materials purchased in state that you don't pay sales tax on, later on, if you use it for yourself, you have to pay use tax on.
geeez... can't they make this any more confusing?? I guess this is the one thing I don't miss about my sign shop!!
posted
Out of State companies should not be charging you sales tax, unless like OP said and they have a branch in your state.
If they only have the one location and they are charging sales tax on out of state sales, chances are they dont even know they dont have to charge the taxes. Missouri sends out new tax rules at a minimum of once per year, plus they have updates throughout the year and send them out whenever they change something. I started my business two years ago while living in St Louis, but I always ordered everything from signwarehouse.com cause it's more convenient... if I dont have to leave the house, I wont. =)
------------------ Mike Pipes -----trapped in a box with a computer and a slice of cheese-----
Posts: 145 | From: Lake Havasu City, AZ | Registered: Dec 2000
| IP: Logged |
posted
Dave, OP is right about sales tax if they have a distributor/warehouse in your state. Dana is right about paying taxes on equipment and supplies bought out of state, there's a line on your sales tax form about 'items bought out of state for your use'. If you ever get audited they'll go back several years and make you come up with those 'back taxes' (the voice of experience here), cost me a few grand to find out the hard way! You are subject to sales tax on all items that are not billed to or used up on one particular job. A quart of lettering paint is taxable unless you use the whole quart on a taxable job! They figure if you only use a spoonful on lettering a truck door or office door (which is not taxable because it is considered personal property) then you own them tax on the materials involved so you pay it up front when you purchase the paint. I know each state has different laws but that's the way it is in Tennessee. It's getting to where you need a full time tax attorney to decipher all the rhetoric fro the tax man.
------------------ Larry
Elliott Design McLemoresville, Tn.
If you can't find the time to do it right, where gonna find the time to do it over?
Posts: 486 | From: McLemoresville, TN. USA | Registered: Nov 1998
| IP: Logged |
posted
When My Accountant needs a sign, he comes to me, When I need to pay taxes, I go to him. Everything I buy I use Master Card, My Accountant! Priceless Bill
------------------ Bill & Barbara Biggs Art's Sign Service, Inc. Clute, Texas, USA Home of The Great Texas Mosquito Festival Proud Third year Supporter of the Letterheads Website MailTo:twobeesusa@netscape.net
Posts: 1020 | From: Lake Jackson,Tx | Registered: Nov 1998
| IP: Logged |
I stopped in at Standard this afternoon on my lunch break (this office is about 15 minutes away) and they have alot of cool stuff there.. pretty good sized place..
They switched to FDC vinyls, but it's still Avery films, just a different converter and a lower price. When I saw the full line of Avery films in the color chart I was just floored.. they make so much cool stuff!
------------------ Mike Pipes -----trapped in a box with a computer and a slice of cheese-----
Posts: 145 | From: Lake Havasu City, AZ | Registered: Dec 2000
| IP: Logged |
Printer-friendly view of this topic