Sales Tax?!?

[MadReferee]

</font><font color="blue" class="small">( In NH, there is no sales tax. In NH, there is a furniture store called Green Mtn. Furniture. The State of Maine went in there and audited their book keeping. The State of Maine went away with a list of names of people who did not pay sales tax. )</font>

As the former owner of a New Hampshire business there is no way I would have let revenue agents from another state have a look at my books without a court order. NH judges typically do not issue such an order and I have never heard of anyone having this done to them. In fact, NH encourages out of staters to buy here because we have no sales tax. It's good for our economy.

Now if the Green Mtn Furniture company was headquartered in Maine then Maine could audit the coprorate books. I am sure that is what happened otherwise this is just an urban legend.

 

[sirgknight]

Messick Farm Equip is correct: with the provisions as stated, all interstate sales are, by federal law, tax exempt, whether the purchase is made by mail or in person. Delivery point is key. This is why companies can not charge you any tax for interstate purchase.

 

[Bob_Skurka]

Mad, I have no clue about the specifics of the furniture company in NH, but MANY companies in MANY different consumer segments have in fact won court orders to audit the books of out of state companies that advertise the TAX FEE shipping out of state on consumer goods. The internet is what is changing things. Many states, and I would bet NH, would probably not allow another state to audit my books without due cause, but the internet is creating due cause. So perhaps your business was the type that would not create a due cause issue? Or perhaps you sold it a couple years ago before a lot of this stuff hit the fan? I certainly don't know any specifics of any of these things, just asking questions.

I will, however, say that my business has been audited several times for "use" tax, by not only my home state but out of state revenue departments. We are a large company (over $100MM in revenues) so perhaps we are a magnet/target? But we pay &/or charge the appropriate taxes. We did get caught one time (15??? years ago) but it was not intentional evasion, still paid interst & penalty!!!

 

[Bob_Skurka]

</font><font color="blueclass=small">( Messick Farm Equip is correct: with the provisions as stated, all interstate sales are, by federal law, tax exempt, whether the purchase is made by mail or in person. Delivery point is key. This is why companies can not charge you any tax for interstate purchase. )</font>
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Technically CAN BE wrong in your last statement (SOMETIMES). If the company has a physical presence in your home state (even if it is a division of the company under a totally different name) then the transaction is considered an IN state transaction and sale tax must be charged. And that is fairly common when you buy from a "catalog" company like LANDS END, which is owned by SEARS or any similar type of company.

HOWEVER, just because the interstate sales is exempt from sales tax, that has NOTHING to do with your obligation to pay your home state's USE tax. 2 different taxes. Only one applies. They are mutually exclusive so if one is paid the other is not owed.
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[dhjmdls]

Don't want to even touch this thread, she's red-hot! /forums/images/graemlins/laugh.gif

 

[jfdlaw]

Guys, there are two issues here:

First, Does the state in which you reside require you to pay a sales tax? Here in NY the answer it yes. Regardless of where I bought it, if I bought it used, etc., the state, town and county require I pay 8.25% of whatever I buy (with certain specific exceptions) as a sales tax.

Second, Is the dealer (or Vendor) required by your state to collect and remit sales tax? A dealer with no ties to NY is not obligated to collect sales tax from a NY purchaser and remit it to NY state. That doesn't mean you don't owe the tax. It just means the dealer has no obligation to your state to collect the tax for them.

If I buy a tractor I owe the state sales tax no matter where I buy it or from where it is shipped. If I buy it from a NY dealer, or a dealer which has a presence in NY, they have an obligation to collect the sales tax from me and forward it to the state. If they don't collect it and I don't pay it, they would be liable for the tax.

Just because an out of state dealer doesn't collect the tax doesn't mean you don't have to pay it. The responsibility to pay the tax rests on the buyer and is determined by the state in which you reside.

States require Vendors (over which they have control) to collect and remit sales tax to make it easier for the tax collectors. Kind of like how the IRS requires us employers to collect payroll taxes from our employees and remit it. If your employer doesn't withhold taxes it doesn't relieve you from the responsibility of paying them.

 

[755inNY]

<font color="blue"> I am not up on ALL the state laws, but most states would not be able to come back and charge you the home state tax on a good that you picked up in a different state, if you paid the tax on the good in that state. </font>

As a resident of NY, paying the sales tax in another state does not necessarily take care of your tax obligation to NY. If your NY sales tax obligation is 8% and you paid 4%, NY will be looking for the difference. This would mean the full 8% if the state where you purchased the item did not have a sales tax.

Jeff

 

[Ledgemere Farm]

Sorry. I did not mean to accuse you. I was making a general statement. As with many others, taxes are a real sore spot with me. /forums/images/graemlins/blush.gif

 

[Ledgemere Farm]

Maine and NH have some kind of deal. It is not uncommon for the Maine Revenue Service to go over the line to audit books (I am told).

 

[Ledgemere Farm]

On your Maine Income Tax form, you can either figure the sales tax on the total you bought over the internet, or you can pay $40. Pay them $40.