Ohio taxes on out of state purchase?

[crazyal]

The tractor is not for farm use is it? I know in VT farm equipment is exempt. If you do buy it out of state and you take a loan out on it there's a good cance the company loaning the money will file something with the town or state (since there is no title like a car). If so that's another paper record that could get you caught if you decide not to report it. Also some out of state stores will not collect taxes but still need to report the sale to your state, usually it's an agreement between states.

 

[tulenutn2o]

Can't answer for your state but just this year, California has added a new question to their tax form: (paraphrased) "Did you purchase anything out of state over the internet during this tax period and had delivered into California? If so, what is the value........"

Use a Bill Clinton line..........Define the meaning of "is":laughing:

 

[dave1949]

Maine has a check box and chart with suggested use tax to pay based upon your adjusted gross on the state income tax forms. Lot of people go to 'Live Free Or Die' NH to buy things where they don't collect sales tax. You will pay plenty of taxes in NH, so don't start planning your move just yet.

The side of this not mentioned is the disadvantage internet sales put on local merchants. They have to collect the tax and remit to the state with all the paper work, etc.

Since no one has figured out how to run a taxless country, to my knowledge - well maybe an Arab Oil nation or something; not taxing internet sales in states that rely on sales tax makes no sense. They will get their required revenue somewhere else. Like property taxes.

It's an example of robbing Peter to pay Paul and local merchants are getting hurt.
Dave.

 

[CJBOTA]

My experience is Ohio is much tougher and clearer on road vehichles then tractors. Also, if you have a business you can be exempt if the tractor is used for that business. I recently tried to get a pick up truck on the same premise and the dealer who is also a farmer said no way. Ohio is known as the gustopo state. They want all your money. Our state employees have to make payroll somehow. Harrassing residents is there favorite passtime. Just a bunch of blood sucking leeches.
cj

 

[jcims]

Thanks for all the replies folks!

Some of the discussion made me realize the question might be a little bit more complex. I dug around and found this on the Ohio Dept. of Taxation's site:

Welcome to the Ohio Department of Taxation

There were two sections of interest:

2. What sales are exempt/excepted from sales tax?
...
* Sales of property for used directly in agricultural production.
* Property used in the preparation of eggs for sale.
...
* "Direct use" exemptions:
o Material used or consumed directly in mining, farming, agriculture, horticulture, floriculture, or used in the production of and exploration for crude oil and natural gas. Motor vehicles titled and registered to operate on the highways generally do not qualify for exemption
...

and

21. As a farmer, may I claim exemption on my purchases and how?

Farmers are entitled to claim exemption on the purchase of items of tangible personal property used directly in the production of a product for sale. This would include, but is not limited to: seeds, fertilizers, insecticides, pesticides, field tiles, tractors, plows, combines, and specially designed motor vehicles with PTO applicator units that travel from farm to farm to apply chemicals and fertilizers. This would not include: almost all motor vehicles licensed to operate on the highway [passenger cars; pick-up trucks; larger trucks and trailers that are primarily used to haul people, animals, raw materials (seeds, fertilizers, insecticides and pesticides) to the farm and finished goods (corn, wheat, soy beans, cattle, hogs, etc.) from the farm to market], lawn mowers, weed eaters, items used to maintain set-a-side fields, chain saws, all purposes vehicles that are primarily used for recreation, and home garden equipment.

I'm not sure what the standard would be for 'used directly in the production of a product for sale'. A 50'x50' garden for the local farmer's market? Mowing around a chicken coop?

I have no intention of skirting the law, but I don't feel like just flopping over and signing over a thousand bucks to the state for giggles.

Thanks again for the input folks, it's been helpful!

(Oh, and CJBOTA isn't kidding).

 

[bdeboer]

Thanks for all the replies folks!

Some of the discussion made me realize the question might be a little bit more complex. I dug around and found this on the Ohio Dept. of Taxation's site:

Welcome to the Ohio Department of Taxation

There were two sections of interest:



and



I'm not sure what the standard would be for 'used directly in the production of a product for sale'. A 50'x50' garden for the local farmer's market? Mowing around a chicken coop?

I have no intention of skirting the law, but I don't feel like just flopping over and signing over a thousand bucks to the state for giggles.

Thanks again for the input folks, it's been helpful!

(Oh, and CJBOTA isn't kidding).

Do you have any land in CAUV? I would think that a tractor purpose would give the tax exemption, although a finish type mower or mid-mount would have to be taxed. At least that is how it was explained to me.

 

[fredhargis]

My experience is Ohio is much tougher and clearer on road vehichles then tractors. Also, if you have a business you can be exempt if the tractor is used for that business. I recently tried to get a pick up truck on the same premise and the dealer who is also a farmer said no way. Ohio is known as the gustopo state. They want all your money. Our state employees have to make payroll somehow. Harrassing residents is there favorite passtime. Just a bunch of blood sucking leeches.
cj

I couldn't agree more, nothing is more important in this state than bleeding the citizens dry.

I'm not sure what the standard would be for 'used directly in the production of a product for sale'. A 50'x50' garden for the local farmer's market? Mowing around a chicken coop?

I have no intention of skirting the law, but I don't feel like just flopping over and signing over a thousand bucks to the state for giggles.

Thanks again for the input folks, it's been helpful!

(Oh, and CJBOTA isn't kidding).

If the tractor is used in an ongoing for-profit business, it's not taxed. That's true for all business operations. My guess is that since your asking, your tractor isn't going to be used as such and you are legally liable for the use tax. As someone mentioned it's right on your state income tax form, and explained in that booklet as well. This isn't a recommendation to pay it, because in all honesty the state has limited means to track down such purchases.

 

[Pops15]

Maine has a check box and chart with suggested use tax to pay based upon your adjusted gross on the state income tax forms. Lot of people go to 'Live Free Or Die' NH to buy things where they don't collect sales tax. You will pay plenty of taxes in NH, so don't start planning your move just yet.

The side of this not mentioned is the disadvantage internet sales put on local merchants. They have to collect the tax and remit to the state with all the paper work, etc.

Since no one has figured out how to run a taxless country, to my knowledge - well maybe an Arab Oil nation or something; not taxing internet sales in states that rely on sales tax makes no sense. They will get their required revenue somewhere else. Like property taxes.

It's an example of robbing Peter to pay Paul and local merchants are getting hurt.
Dave.

I read somewhere that there are over 7000 different sales tax rates in the US.

 

[john4153]

In Ohio, there is a sales tax exemption for farm equipment used in the production of an agricultural product. I have heard various versions of what's required quoted to me, one is $2400 per year and 10 acres, the other is $2400 per year or 10 acres. I have not bothered to check. Another small detail, tractors and FEL are considered agricultural, but backhoes are not. A local dealer did not believe that distinction was followed, so long as the backhoe was used for an agricultural purpose. BTW, our state income tax also asks about sales/use taxes to declare on out of state or internet purchases.
John (in Ohio)

 

[dave1949]

I read somewhere that there are over 7000 different sales tax rates in the US.

In the past, and probably still true, OH and PA were two of the worst states for having bunches of different city, county, township and state taxes that need to be accounted for in payroll processing.

There could well be that many different sales tax rates. Said that way, it illustrates how stupid the situation is. Also how difficult it would be for internet-based sales to be accurately taxed. Everytime a city, county or township makes a change, somebody has to update computer programs to reflect that. It also means they will pay someone to keep them informed of those changes. Very wasteful.

All but a couple state's budgets are in deep doo-doo now. They will no doubt increase tax collection enforcement to offset any part of their deficits possible.
Dave.