No tax for farm use???

[jeffgbook]

I just got home from getting a quote from a Mahindra dealer, and the salesman (which actually new what he was talking about tractor-wise) told me that they never add tax to a tractor sale.

I was telling him a price I was given on a Kubota, and I mentioned before tax, and he said "there's no tax on farm use". I said "they can't come back on you?", and he said "we never charge tax on tractors."

Is this true or am I supposed to say "NO. You better charge me tax mister!"

I'm afraid if I don't pay tax now, they'll get tax + more later etc.

Anybody seen this? Jeff

 

[CajunRider]

In Texas if you sign a tax form saying that the tractor will be used for farming then there is no sale tax. Of course if you are audited by the state ....

 

[RedRocker]

If your land is Ag or wildlife exempt, you pay no sales tax on anything used for that purpose, in Texas anyway.

 

[MikePA]

Some food for thought...Pretend you work the the sales tax division of your state government and you are looking to find people who are not paying their fair share, aka tax cheats. Where would you look? Hmmm, maybe at farm equipment dealers who sell a lot of tractors to people who claim to be farmers. I'd just get copies of all the forms and take a gander at what size tractor they bought. Anything under say 50 hp, I'd take a drive past the place. Maybe I'd drop the hp limit depending upon how many forms there were. Gee, some guy who claims to be a farmer, lives on a 3 acre lot in a subdivision. Busted!

The first dealer I visited, a Kubota dealer, said the same thing to me. I figured if the guy was willing to cheat the state, he wouldn't blink an eye to cheat me. How honest could he be? I bought elsewhere.

 

[jeffgbook]

Loud and Clear. Thanks for keeping me out of prison /forums/images/graemlins/crazy.gif. I'll pay the 12 or 13 hundred dollars extra. Jeff. /forums/images/graemlins/grin.gif

 

[Henro]

Jeff,

A the result of another thread I got interested in the sales/use tax question and did some reading on line at our state web site.

Something interesting that I think I read is that the purchaser in this state is the responsible party. So if I would buy something and the seller would not collect the sales tax, and the state discovered this, it would be me, not the seller, that was responsible for the tax and interest penalties! This apparently holds true for out of state purchases too, but then it is called Use tax rather than Sales tax...

I am not trying to say what is right, wrong or what anyone should do. Just that I got the impression from some past posts that if a dealer did not collect sales tax, that he might be responsible for it later. That woud probably be the way it worked if he collected the sales tax and did not pay it to the state, but not if he did not collect it to begin with.

Food for thought, nothing more...

 

[jfdlaw]

I had a salesman say that to me too. (That I could say the tractor was for ag use and not pay sales tax) I asked him for the form I would have to sign. It basically said that I certified that I was engaged in agricultural activities (raising crops/livestock/etc for profit) and that the tractor would be used exclusively for that work. Unfortunately I don't. The dealer said no one checks, he just had to have it on file. The way I figure it, if the dealer got audited he would just pass the blame on to me and I would be the one in hot water.

For a number of reasons I went to another dealer and asked him about the ag exemption. He looked at me kind of funny and told me I could only get that if I was running a farm. I ended up buying from the second dealer.

P.S. - Henro is exactly right. The burden to pay the tax is on the purchaser. The dealer has the duty to act as a collection agent and collect it from the purchaser. Just because the dealer doesn't do his job, doesn't mean you don't have to pay. If the dealer gets caught he'll face penalties for failure to collect the tax, but you will end up having to pay the tax and the penalties. Plus, if you signed a false statement, you may be dealing with Perjury charges.

 

[jeffgbook]

Gotcha. Glad at least ya'll are looking out for me, because apparently the dealer sure as @$#! isn't /forums/images/graemlins/mad.gif. Thanks. Jeff

 

[phxraptor]

In Texas if you have an ag. exemption indeed you do NOT pay sales tax on ANY farm related equip/supplies/seed/fertilzer etc. In addition you qualify for a RED diesel fuel exemption which allows you to NOT pay tax on only red diesel fuel to be used ONLY for ag/off road vehicles. ie tractors/diesel rtvs etc. Hope this helps.

 

[RickO]

Would SwitchGrass be considered farming! I have two large switchGrass plots on the back of my property for Pheasant habitat. I planted them both about 3 years ago. I plan on tearing one of them up and replanting it since it didn't come up too well with my, soon to be purchased, tractor! Does anyone know if Ohio has tax exempt for Wildlife plots?