Education and training on state sales and use taxes.
We focus on the laws, as well as your systems, policies and procedures to assure compliance.
There are a couple of jokes, too.
Tuesday, June 28, 2011
Sales Taxes and the Amish
There have been some stories this week about some problems that Amish are having with a new rule in New York requiring EVERYONE to file electronically. This means the Amish too. This is a pretty thorough article. While it makes for a good story, I'm not sure it's that big of a deal.
I've always found the Amish culture interesting and have read about it over the years. And I've even done sales tax seminars for them. One thing to keep in mind is that Amish rules are very intricate and convoluted. It's not so much that they have a problem with electricity, but that they have a problem being connected to utility lines, which connects them to the outside world, which weakens their community. For Amish, preserving their community is paramount. And admirable.
So they don't have phones or utility-provided electricity. But you'll often see public telephones near their communities. And they may use battery or generator powered electric devices in their shops and on their farms. But it's all highly variable. They make these decisions locally and some groups are stricter than others.
I have a friend whose company has more than a few Amish customers. There's usually a problem because they can't use the internet, web or email, have trouble faxing in orders, and the mail is too slow. They can't take digital pictures of damaged goods and email them for the obvious reasons. She can't call them back when they leave a message because, well, they were standing at a pay phone. But she tells me that they are almost invariably the nicest customers to deal with.
So what has this to do with electronically filing sales tax? They can't. Period. Electronic filing requires a computer, internet connection, email and the web. They don't do any of those things. So what's the solution?
As the article I mentioned above shows, after some prodding of a typically unresponsive and resistant government bureaucracy, they were told that they can still file their returns by mail. And here's the other thing. Most Amish have accountants. THEY can do all the things necessary to file electronically.
Electronic filing is a good thing. It helps avoid errors, and allows the government to cut some staff that were doing data entry. Making the "G" more efficient is highly desirable, if unlikely. Plus, in this instance, the rule gives more business to local accounting firms. Which is a wonderful thing.
So don't worry about the Amish (I'm guessing you weren't). I'll be honest, the real reason I wrote this was to use that nice picture I took in southeastern Pennsylvania. And to dazzle you with my knowledge of things that have no relationship to sales taxes.
Have a glorious day. I don't know about where you are, but here in the western suburbs of Chicago, it's a beautiful day. Why are you reading this blog? Go outside and play! Go on, git!
The Sales Tax Guy
http://salestaxguy.blogspot.com
See the disclaimer - this is for education only. Research these issues thoroughly before making decisions. Remember: there are details we haven't discussed, and every state is different. Here's more information
Get these articles in your inbox - subscribe at http://salestaxguy.blogspot.com
Don't forget our upcoming seminars and webinars.
http://www.salestax-usetax.com/
Picture note: the image above is hosted on Flickr. If you'd like to see more, click on the photo.
Labels:
Editorials,
Humor,
Links,
News
Friday, June 24, 2011
Links: News
Tax break for Nebraska tanning salons gets burned
I like this one, if only for the headline kearneyhub.com
Jerry Brown vetoes California budget money.cnn.com
States Increase Taxes For Ninth Consecutive Year avalara.com
Sales Tax News Roundup avalara.com
ESCONDIDO: Walmart deal depends on $750K sales tax subsidy nctimes.com
Ohio Use Tax Update speedtax.com
Texas Two-Step—One Step Forward, One Step Back avalara.com
Maine does away with aircraft sales taxes stamfordadvocate.com
RI considers taxing over-the-counter drugs boston.com
eBay leery of 'Amazon tax' on online sales in California therepublic.com
The Sales Tax Guy
http://salestaxguy.blogspot.com
See the disclaimer - this is for education only. Research these issues thoroughly before making decisions. Remember: there are details we haven't discussed, and every state is different. Here's more information
Get these articles in your inbox - subscribe at http://salestaxguy.blogspot.com
Don't forget our upcoming seminars and webinars.
http://www.salestax-usetax.com/
Picture note: the image above is hosted on Flickr. If you'd like to see more, click on the photo.
I like this one, if only for the headline kearneyhub.com
Jerry Brown vetoes California budget money.cnn.com
States Increase Taxes For Ninth Consecutive Year avalara.com
Sales Tax News Roundup avalara.com
ESCONDIDO: Walmart deal depends on $750K sales tax subsidy nctimes.com
Ohio Use Tax Update speedtax.com
Texas Two-Step—One Step Forward, One Step Back avalara.com
Maine does away with aircraft sales taxes stamfordadvocate.com
RI considers taxing over-the-counter drugs boston.com
eBay leery of 'Amazon tax' on online sales in California therepublic.com
The Sales Tax Guy
http://salestaxguy.blogspot.com
See the disclaimer - this is for education only. Research these issues thoroughly before making decisions. Remember: there are details we haven't discussed, and every state is different. Here's more information
Get these articles in your inbox - subscribe at http://salestaxguy.blogspot.com
Don't forget our upcoming seminars and webinars.
http://www.salestax-usetax.com/
Picture note: the image above is hosted on Flickr. If you'd like to see more, click on the photo.
Wednesday, June 22, 2011
Links- Nexus
Here is a selection of recent links I've come across
Navigating Nexus - Multistate business operations face a wide variety of state taxes
Nice details about how you are exposed to nexus - Journal of Accountancy
Amazon offers Texas 5,000 jobs in trade for sales-tax exemption Seattle Times
Texas Two-Step—One Step Forward, One Step Back Avalara
Internet company FatWallet hops the Illinois border to Beloit Wisconsin State Journal
Map: Amazon’s sales tax battle Geekwire
Texas Clears Up Server-Nexus E-Commerce Sales Tax Issue ecommercetimes.com
Sales Tax Nexus - Victory for the Internet Retailers! taxconnex.com
Working up a tax storm in Illinois washingtonpost.com
Internet Sales Tax to be Introduced in US Senate foxnews.com
The Problem With Online Sales Tax cpatechreviews.com
Barnes and Noble Wants Amazon's Rejected Affiliates auctionbytes.com
On Line Travel Services Subject To Sales Tax in D.C. sabrix.com
Sales Tax Nexus Changes Will Surprise You taxconnex.com
The Sales Tax Guy
http://salestaxguy.blogspot.com
See the disclaimer - this is for education only. Research these issues thoroughly before making decisions. Remember: there are details we haven't discussed, and every state is different. Here's more information
Get these articles in your inbox - subscribe at http://salestaxguy.blogspot.com
Don't forget our upcoming seminars and webinars.
http://www.salestax-usetax.com/
Picture note: the image above is hosted on Flickr. If you'd like to see more, click on the photo.
Navigating Nexus - Multistate business operations face a wide variety of state taxes
Nice details about how you are exposed to nexus - Journal of Accountancy
Amazon offers Texas 5,000 jobs in trade for sales-tax exemption Seattle Times
Texas Two-Step—One Step Forward, One Step Back Avalara
Internet company FatWallet hops the Illinois border to Beloit Wisconsin State Journal
Map: Amazon’s sales tax battle Geekwire
Texas Clears Up Server-Nexus E-Commerce Sales Tax Issue ecommercetimes.com
Sales Tax Nexus - Victory for the Internet Retailers! taxconnex.com
Working up a tax storm in Illinois washingtonpost.com
Internet Sales Tax to be Introduced in US Senate foxnews.com
The Problem With Online Sales Tax cpatechreviews.com
Barnes and Noble Wants Amazon's Rejected Affiliates auctionbytes.com
On Line Travel Services Subject To Sales Tax in D.C. sabrix.com
Sales Tax Nexus Changes Will Surprise You taxconnex.com
The Sales Tax Guy
http://salestaxguy.blogspot.com
See the disclaimer - this is for education only. Research these issues thoroughly before making decisions. Remember: there are details we haven't discussed, and every state is different. Here's more information
Get these articles in your inbox - subscribe at http://salestaxguy.blogspot.com
Don't forget our upcoming seminars and webinars.
http://www.salestax-usetax.com/
Picture note: the image above is hosted on Flickr. If you'd like to see more, click on the photo.
Tuesday, June 14, 2011
Sales and Use Tax Books You Should Own - Redux
This article first appeared back in 2007 and I thought it should see the light of day again.
These are sales and use tax books that I strongly recommend as reference tools. If you have to worry about a few states, you really should own them. If you are in only one state, they may be overkill, but are still worthwhile. Both books cover all of the states.
Guide to Sales and Use Taxes (from Research Institute of America)
This book has an enormous amount of information for each state, with the material broken up into 15 subchapters within each state chapter. It also has an opening chapter which is basically "sales tax 101." If the book is weak, it is in two areas: there aren't any citations, and it sometimes provides too much data with too little interpretation. These deficiencies are made up for in the next book.
Sales and Use Tax Deskbook (from the American Bar Association)
Each state's treatment is written by an attorney who specializes in that state's sales and use taxes. While I've only met a couple of them, I heard of many more. So far, they have all been heavy SUT litigators and highly "plugged in."
The book actually provides less detail than the Guide (above), but does provide more interpretation of the laws, as well as citations. So you can read the basic information, then drill down to the statute, regulation, bulletin, court case, opinion letter, etc.
Here are two particularly useful items provided by the book:
1. It gives you the rules for taxation of exports out of the state. Now you'll have ammunition for your discussions with vendors who are charging you their state's tax as opposed to the correct one (yours).
2. For most states, the book shows the "drop ship" rules, which will, again, help with vendors who really don't understand this particular topic.
I actually recommend both books if you have the budget.
First of all, owning both books gives you the ability of second sourcing or even third sourcing your research. It's always helpful, on confusing issues, to see if the books agree.
The other reason is updates. By owning both books, you can flip-flop your purchases. One year get an updated version of the inexpensive book, next year get the expensive one, and so on.
Finally, you'll notice I'm not offering to sell you these books. That's because I want you to trust that I'm not biased here. I'm not recommending them to make money. Contact the publishers and they'll be happy to sell them to you.
The Sales Tax Guy
http://salestaxguy.blogspot.com
See the disclaimer - this is for education only. Research these issues thoroughly before making decisions. Remember: there are details we haven't discussed, and every state is different. Here's more information
Get these articles in your inbox - subscribe at http://salestaxguy.blogspot.com
Don't forget our upcoming seminars and webinars.
http://www.salestax-usetax.com/
Picture note: the image above is hosted on Flickr. If you'd like to see more, click on the photo.
These are sales and use tax books that I strongly recommend as reference tools. If you have to worry about a few states, you really should own them. If you are in only one state, they may be overkill, but are still worthwhile. Both books cover all of the states.
Guide to Sales and Use Taxes (from Research Institute of America)
This book has an enormous amount of information for each state, with the material broken up into 15 subchapters within each state chapter. It also has an opening chapter which is basically "sales tax 101." If the book is weak, it is in two areas: there aren't any citations, and it sometimes provides too much data with too little interpretation. These deficiencies are made up for in the next book.
Sales and Use Tax Deskbook (from the American Bar Association)
Each state's treatment is written by an attorney who specializes in that state's sales and use taxes. While I've only met a couple of them, I heard of many more. So far, they have all been heavy SUT litigators and highly "plugged in."
The book actually provides less detail than the Guide (above), but does provide more interpretation of the laws, as well as citations. So you can read the basic information, then drill down to the statute, regulation, bulletin, court case, opinion letter, etc.
Here are two particularly useful items provided by the book:
1. It gives you the rules for taxation of exports out of the state. Now you'll have ammunition for your discussions with vendors who are charging you their state's tax as opposed to the correct one (yours).
2. For most states, the book shows the "drop ship" rules, which will, again, help with vendors who really don't understand this particular topic.
I actually recommend both books if you have the budget.
First of all, owning both books gives you the ability of second sourcing or even third sourcing your research. It's always helpful, on confusing issues, to see if the books agree.
The other reason is updates. By owning both books, you can flip-flop your purchases. One year get an updated version of the inexpensive book, next year get the expensive one, and so on.
Finally, you'll notice I'm not offering to sell you these books. That's because I want you to trust that I'm not biased here. I'm not recommending them to make money. Contact the publishers and they'll be happy to sell them to you.
The Sales Tax Guy
http://salestaxguy.blogspot.com
See the disclaimer - this is for education only. Research these issues thoroughly before making decisions. Remember: there are details we haven't discussed, and every state is different. Here's more information
Get these articles in your inbox - subscribe at http://salestaxguy.blogspot.com
Don't forget our upcoming seminars and webinars.
http://www.salestax-usetax.com/
Picture note: the image above is hosted on Flickr. If you'd like to see more, click on the photo.
Monday, June 13, 2011
New Cover Art for the Latest Sales Tax Guy Album!
A friend of mine gave me the moniker Jim "I got the sales tax blues" Frazier. He's now shot two "album covers." Here are his comments about this picture on Flickr (and you can click on the picture to see it and more of his photos).
You heard it hear first folks.
We have once again gotten the scoop on Jim "I got the sales tax blues" Frazier's next Album.
Here's his previous "cover" shotRumor has it that the title is "So you want to date my daughter?" and the above is some of the artwork from the album.Rumored tracks include "Better start running now", "From an appropriate distance", and "Make her cry, I make you cry".
His real name is Chuck Isdale and he is very...creative ;-) You should see his Gloria Swanson tribute.
Full disclosure: the gun isn't real, I don't play the guitar, and they aren't my daughters.
The Sales Tax Guy
http://salestaxguy.blogspot.com
Labels:
Humor
Monday, June 06, 2011
Historical Places
I had a question from a webinar participant last week about the "landmark exemption." I had to honestly respond that I didn't have a clue about what he was talking about. In a subsequent exchange of emails, I figured out that Texas has an unusual and obscure exemption for contractor's services performed on buildings that are the National Register of Historic Places.
I've been doing training on Texas sales and use taxes for eight years and that's the first time I'd ever heard of it. My excuse is that Texas has some of the more spectacularly complicated rules about contractors. And this is a pretty obscure rule. In order to find information on it, I finally had to resort to doing a text-search for "historic" in my RIA database. But once I figured out what was going on, I found that there were a couple of good lessons for you folks.
First of all, who would have thought there was an exemption such as this? I did some additional research in other states and only found one other state, Connecticut, that has a generic exemption for construction related costs on historic buildings. TWO STATES! There are a couple of other exemptions floating around, but they tend to be for specific projects such as a YWCA building in DC, provide tax credits if the projects promote tourism, or are for projects covered by non-profit organization exemptions.
I find it hard to justify this exemption. The tourism related credits I get - there's a tax revenue pay-off for the state that will probably offset the credits. But, with states desperate for money, they're giving exemptions for restoring a historic building? Now I am a big fan of historic places - they're one of my photography projects. But is the presence or absence of a tax credit really going to have an affect on an owner's decision about restoration? I'll bet the net result is that some well connected folks get some tax benefits, and the state loses a lot of money unnecessarily. Sigh.
The second point is that there are some really obscure exemptions out there. Always be looking to take advantage of the lack of common sense on the part of our elected representatives. Pay particular attention to continuing transactions that will result in big dollars, as well as the one-off big deal. And, now that you've read this, keep an eye out for historic site exemptions while you're at it.
Finally, to complete the discussion about historic places, there's another exemption that is a little more common. Many states impose sales tax on admissions charges. And many of those states grant exemptions for admissions to historic sites.
The Sales Tax Guy
http://salestaxguy.blogspot.com
See the disclaimer - this is for education only. Research these issues thoroughly before making decisions. Remember: there are details we haven't discussed, and every state is different. Here's more information
Get these articles in your inbox - subscribe at http://salestaxguy.blogspot.com
Don't forget our upcoming seminars and webinars.
http://www.salestax-usetax.com/
Picture note: the image above is hosted on Flickr. If you'd like to see more, click on the photo.
I've been doing training on Texas sales and use taxes for eight years and that's the first time I'd ever heard of it. My excuse is that Texas has some of the more spectacularly complicated rules about contractors. And this is a pretty obscure rule. In order to find information on it, I finally had to resort to doing a text-search for "historic" in my RIA database. But once I figured out what was going on, I found that there were a couple of good lessons for you folks.
First of all, who would have thought there was an exemption such as this? I did some additional research in other states and only found one other state, Connecticut, that has a generic exemption for construction related costs on historic buildings. TWO STATES! There are a couple of other exemptions floating around, but they tend to be for specific projects such as a YWCA building in DC, provide tax credits if the projects promote tourism, or are for projects covered by non-profit organization exemptions.
I find it hard to justify this exemption. The tourism related credits I get - there's a tax revenue pay-off for the state that will probably offset the credits. But, with states desperate for money, they're giving exemptions for restoring a historic building? Now I am a big fan of historic places - they're one of my photography projects. But is the presence or absence of a tax credit really going to have an affect on an owner's decision about restoration? I'll bet the net result is that some well connected folks get some tax benefits, and the state loses a lot of money unnecessarily. Sigh.
The second point is that there are some really obscure exemptions out there. Always be looking to take advantage of the lack of common sense on the part of our elected representatives. Pay particular attention to continuing transactions that will result in big dollars, as well as the one-off big deal. And, now that you've read this, keep an eye out for historic site exemptions while you're at it.
Finally, to complete the discussion about historic places, there's another exemption that is a little more common. Many states impose sales tax on admissions charges. And many of those states grant exemptions for admissions to historic sites.
The Sales Tax Guy
http://salestaxguy.blogspot.com
See the disclaimer - this is for education only. Research these issues thoroughly before making decisions. Remember: there are details we haven't discussed, and every state is different. Here's more information
Get these articles in your inbox - subscribe at http://salestaxguy.blogspot.com
Don't forget our upcoming seminars and webinars.
http://www.salestax-usetax.com/
Picture note: the image above is hosted on Flickr. If you'd like to see more, click on the photo.
Labels:
Best Practices,
Nutty Rules,
Taxing Policies
Thursday, June 02, 2011
"Main Street" retailers better be careful what they wish for
Most of the sales tax news that I see these days seems to have something to do with states going after Amazon.com. The discussion includes other big Internet vendors - but I'll just say Amazon.com, because that's what everyone else says.
Many of the articles, letters, blogs, comments, and editorials go something like this:
"In order to be fair, Amazon.com should collect sales tax so that the local retailers, who have to charge sales tax, can compete fairly.
This opinion reflects a basic ignorance of the system. It's USE tax when it's an interstate shipment. I know, I'm being fussy, but the level of ignorance displayed drives me crazy. Now if they just took a few webinars...
There's also this common theme:
The state is out of money. If we can make Amazon.com pay taxes, we'll be in high cotton."
Which misses the point. The local customer is paying the taxes. Amazon.com is just being forced to collect it. Make no mistake...there is no shifting of the tax burden to Amazon.com.
And this one
"The state should fix this."
Which is wrong. The states have been trying to do this with aggressive nexus assessments and silly laws involving "associates" in the states. It hasn't worked out really well. The states can't fix this. It's an interstate commerce issue.
But every once in a while, someone makes the correct observation:
"Congress needs to fix this."
Now they've identified the problem. Congress (or the Supreme Court) can fix this by making nexus much simpler. All those "Main Street" local retailers argue that if Amazon.com ships into a state from out of state, they have to charge the local state's tax. OK, Congress can wave the Magic Nexus Wand and make this the law of the land:
Regardless of their physical presence in a state, the seller must charge the taxes for the destination state and remit the taxes to that state.
Nice and simple. And fair.
Full disclosure: I don't want this to happen. Then nobody will sign up for my nexus webinar. I much prefer it complicated. ;-)
But, please remember that all those journalists, editors, chambers of commerce, and local businesses are clamoring for fairness.
Well, folks, here's the part that you don't realize you're wishing for.
If you're like most "Main Street" businesses, you also have a web site. And that almost always means that you sell stuff outside of your state. Guess what? YOU will have to start charging tax on your shipments too. Yep. You want it to be fair, don't you? If Amazon.com has to charge taxes when they ship into your state, and steal your business; then YOU should have to charge taxes when you ship into some other state and steal someone else's business.
I can just hear the howls of protest:
"Oh, no. There will be a dollar limit. Only sellers who have annual sales in excess of $100,000,000 will have to deal with this 'fairer' rule."
That doesn't sound fair to me. And it doesn't sound fair to that guy in the other state whose business you've stolen.
I also wonder if the newspaper publishers who are demanding this "fairness" realize that some of the states where they sell subscriptions actually do tax newspapers. Which means even THEY will have to start charging taxes and filing in those states. And, of course, the famous newspapers probably sell hats, t-shirts, etc. from their web pages. Guess what? Hee hee hee.
And for the politicians. Your constituents, George and Martha, will suddenly be unhappy when they realize that "making Amazon.com pay sales taxes" really means that George and Martha will have to start paying those taxes. Amazon will lose business because they have to charge tax. But George and Martha will have to pay it.
Be careful what you wish for.
The Sales Tax Guy
http://salestaxguy.blogspot.com
See the disclaimer - this is for education only. Research these issues thoroughly before making decisions. Remember: there are details we haven't discussed, and every state is different. Here's more information
Get these articles in your inbox - subscribe at http://salestaxguy.blogspot.com
Don't forget our upcoming seminars and webinars.
http://www.salestax-usetax.com/
Picture note: the image above is hosted on Flickr. If you'd like to see more, click on the photo.
Labels:
Editorials,
Nexus
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