Buying tractor out of state (sales tax?)

[MessickFarmEqu]

We (located in PA) actually had our sales looked over by CT. I don't think they actually went after the customers, but they forced us to get a CT sales tax licence even though we don't have a physical location there.

Not charging an out of state customer tax is legal for the dealer, but illegal for the customer. Not reporting it is at your own risk.

 

[MDM]

Roto, you have 50 acres right. Why not claim it as farm use and tax exept? Do you have any livestock?

 

[Bob_Skurka]

Roto, you have 50 acres right. Why not claim it as farm use and tax exept? Do you have any livestock?

This is a good idea if your accountant says you can get away with it. Depending on your state tax laws you may have to prove you are a legitimate agribusiness to claim any exemption if one is offered.

Not charging an out of state customer tax is legal for the dealer, but illegal for the customer. Not reporting it is at your own risk.

Neil, I've considered you a friend for a long time and rarely do I disagree with you, but this time I really feel compelled to clarify something you wrote.

In MOST cases, it is legal for dealers NOT to collect tax for shipments made out of state, that is perfectly correct; dealers are only compelled to collect in state tax on in state deliveries. Shipping product out of state shifts the burden for tax payment off of the dealer.

The last sentence you wrote is not correct. In fact, not reporting it is TAX EVASION. While that may be "at your own risk" it is never the less, a completely illegal financial risk. People do take that risk, some get away with it, I am not trying to level any judgement on those who break the law, but I am trying to make sure that people clearly understand this is considered to be tax evasion.

Disclaimer, (again) I am not a tax professional nor am I a lawyer. However I have been called in as an expert witness to tesitfy in Federal court cases as well as being called before various legislative bodies (multiple states, and jurisidictions) to testify about cross-state taxation and how it affects revenue and private business as well as buying patterns of individuals when there is a tax imbalance between states.​

 

[Roto]

I have 50 acres and livestock(horses for pleasure) and do agriculture work for my farm animals so maybe i can do something there. What do i have to do?

Mike

 

[Bob_Skurka]

I have 50 acres and livestock(horses for pleasure) and do agriculture work for my farm animals so maybe i can do something there. What do i have to do?

Mike

Talk to an accountant in your state. I would not trust anyone on the internet to give you legal advice for a situation like this, no matter how well intentioned they may be. If (and that is an IF) the state of Maine has a tax exemption for AG equipment, then you probably need to prove you qualify for the exemption. That may be easy to do or it may be a burden, but a local accountant should be able to help you with that decision.

 

[MDM]

Definately look into an Ag exemption. It just depends on your state. Here in Ohio you would qualify 10x over I think. My accountant said that here in Ohio, they are still very lax in regards to tractors being tax exempt, but they are really cracking down on people claiming ATVs for farm use that don't actual farm.

 

[LarryRB]

Neil, In MOST cases, it is legal for dealers NOT to collect tax for shipments made out of state, that is perfectly correct; dealers are only compelled to collect in state tax on in state deliveries. Shipping product out of state shifts the burden for tax payment off of the dealer.
.
Bob, you are Wrong
CT has always demanded their sales tax collected by out of state dealers,., This is nothing new., And the Attorney Generals office DOES CHECK for loans and UCC filings out of state., WHen I bought my tractor from Messicks, first thing NEil said was, WE HAVE TO collect CT sales tax. He was correct in this statement.. My in laws were Chrysler?Dodge/IH truck and some other line dealers 53 years,, Property, is half in MA and half in CT.. 30 years ago, CT made it so hard that the in laws had two elder women, (about 5 hrs per day) strictly doing tax paperwork,, Not only vehicles new and used sold, parts for them and they had gas/fuel pumps splitting the state lines which really made it interesting depending on the trucking company and which state had to be coverered for fuel tax that day.

 

[JDeereman]

AHHHH I see, so if i am going to finance through NH then paperwork might catch up with me. Just wondering if anyone actually has done this and got caught or got away with it and financed through NH?
Mike

John is soooooo right. If you finance it, they will eventually get you. Further, if you plan to insure the tractor, it may need to be titled or otherwise documented... another possible paper trail for the state to cross check for use tax payment.

On the other hand... pay close attention to the rules regarding casual purchase of used, non-registerable equipment from individuals... i.e., non-dealers. Depending on what and where you are buying... and where you might have a close relative or trusted friend... you may be able to do something with this exemption.

Theo

 

[Bob_Skurka]

Neil, In MOST cases, it is legal for dealers NOT to collect tax for shipments made out of state, that is perfectly correct; dealers are only compelled to collect in state tax on in state deliveries. Shipping product out of state shifts the burden for tax payment off of the dealer.

.
Bob, you are Wrong
CT has always demanded their sales tax collected by out of state dealers,., This is nothing new., And the Attorney Generals office DOES CHECK for loans and UCC filings out of state., WHen I bought my tractor from Messicks, first thing NEil said was, WE HAVE TO collect CT sales tax. He was correct in this statement. . . .

Larry, I clearly wrote in "most" cases. I even capitalized it in my post. I highlighted it above so you can see it clearly. You are clearly speaking about the relationship between PA and CONN. PA and OH may have a completely different working relationship; as may PA and NY, etc. . . Further, the buyer in question is living in Maine so that is a completely different state. Neil wrote the following, it was a blanket statement not a statement related to your particular state: " Not charging an out of state customer tax is legal for the dealer, but illegal for the customer."

Consequently I stand by what I wrote as accurate.

 

[Casco1]

Just between us, I bought my tractor in New Hampshire in 2004. It sits in Maine 7 months and in Mass 5 months. I have never paid the sales tax on my tractor in either state and don't intend to. Sales tax only comes into play when you register a vehicle. There's an old saying in Taxachusetts, it comes out of the building trades, but it applies elsewhere. "The fine is usually cheaper than the permit, as well as a lot less grief" Again let's keep this just between us.

PS: I would be very surprised if NH has any kind of reciprocity with any bordering states.