Tuesday, June 17, 2014

Sneaky Taxes

Hiding in Sumac
Just because there's no sales tax on a particular item or service, doesn't mean that there might not be another tax lurking around the corner.

States seem to come up with them to trip you up.  Here are three situations that should worry you:

1.  In Illinois, some home rule jurisdictions are trying to tax self-storage.  Generally, there's no state tax on services, or even rentals, in Illinois, so this would be the kind of thing you wouldn't expect.  Sneaky.

2.  In Indiana, there's a very obscure rule on rental of space for massages, dancing etc.  I'd be willing to bet the rule was created as a way to shut down massage parlors.  They probably don't know about it, so the state can get them the way they got Al Capone - taxes!  It's probably easier to do this than to use undercover cops.

3.  But the top of the sneaky pile comes from Rosemont, Illinois (Illinois again...hmmm).  Here's a city that refused to tell a tax professional what the laws were in their fair city.  Think about that for a second.  A city passes a law, and then refuses to tell people about it.  How do you comply with that?  I should also say that Rosemont has a certain "reputation" in the Chicago area.

So, be on the lookout for taxes that might be lurking, ready to trip you up.  Do as much research as you can, but always be prepared to find something else.  I'd also suggest staying in touch with others in your industry and local jurisdiction to get a little advanced warning.



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