Sales Tax

Sales Tax

This is a discussion on Sales Tax within the Off Topic & Humor Discussion forums, part of the The Back Porch category; I buy and sell steel , products everyday and have a Re-Sale Tax ID # . I am putting a service truck together for a ...

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    Sales Tax

    I buy and sell steel , products everyday and have a Re-Sale Tax ID # . I am putting a service truck together for a customer with a custom ladder rack , tool boxes , and a Honda generator .

    So i go to a Honda dealer ( 2 in fact ) and neither will honor my sales tax number . So now i pay a 60.00 tax and the customer pays a 60.00 tax . And the dealer thinks this makes sense .
    He proceeds to tell me that if he was buying from me i would charge him tax , i said no i won't if you have a resale number . SMH i still have to buy this item so i guess the state wins again .

    Sorry for the rant .
    Last edited by welder516; Yesterday at 02:50 PM. Reason: spppellling
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    So, two out of two don't understand the tax requirements. Can't imagine not a single generator seller would. There's got to be one in the region that would get it. Perhaps a wholesaler, instead of a retailer.
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    Expense it on your business return - just a matter of timing.
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    By the time i get to a place that won't charge the tax the amount of time and effort i just paid the tax . 60.00 tax and i will again pass a mark up plus the tax again . I was just trying to save my customer down the road .
    It was more important to be sensible with my customers money as most of the time they never ask for a price for work we do . I lose a battle here and there but keep plugging along .
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    Sorry. We have idiots everywhere.
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    I saw this thread 2 hours ago and could have hit it. I chose instead to leave it ALONE as I know myself when Sales Tax enters to it. You're much more mellow than I would be Welder.
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    Quote Originally Posted by NONAME762 View Post
    I saw this thread 2 hours ago and could have hit it. I chose instead to leave it ALONE as I know myself when Sales Tax enters to it. You're much more mellow than I would be Welder.
    NONAME , The customer said he wanted a Honda 2000 inverter generator bottom line i keep my customer happy . I also could have had my brother that lives in DE. to buy it > (no tax there) but needed sooner then later .
    Plus as the saying goes time is money .

    I just hate the State of Maryland get two taxes on one item and i have all the documents to buy tax free . They would sell to the Government and None profit without tax but to me a Big No . SMH
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    Quote Originally Posted by welder516 View Post
    I buy and sell steel , products everyday and have a Re-Sale Tax ID # . I am putting a service truck together for a customer with a custom ladder rack , tool boxes , and a Honda generator .

    So i go to a Honda dealer ( 2 in fact ) and neither will honor my sales tax number . So now i pay a 60.00 tax and the customer pays a 60.00 tax . And the dealer thinks this makes sense .
    He proceeds to tell me that if he was buying from me i would charge him tax , i said no i won't if you have a resale number . SMH i still have to buy this item so i guess the state wins again .

    Sorry for the rant .
    Don't charge your customer tax on the item...it is a non taxable item to your customer...the tax has already been paid on the item. You sell it to your customer at the price you were charge since the tax has already been paid. If it cost you $1060, you charge your customer $1060 non-taxable and you mark the item as a non-taxable sale so that the tax is only paid once...paid by you through the Honda dealership who transfers your payment to the State. You recoup your costs by charging your client the full price you paid but you don't pass anything along to the State because Honda is the one who is responsible for making that payment to the State. Everything you charge...$1060...is yours to keep because it is a non-taxable sale.
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    Quote Originally Posted by 1MoreGoodGuy View Post
    Don't charge your customer tax on the item...it is a non taxable item to your customer...the tax has already been paid on the item. You sell it to your customer at the price you were charge since the tax has already been paid. If it cost you $1060, you charge your customer $1060 non-taxable and you mark the item as a non-taxable sale so that the tax is only paid once...paid by you through the Honda dealership who transfers your payment to the State. You recoup your costs by charging your client the full price you paid but you don't pass anything along to the State because Honda is the one who is responsible for making that payment to the State. Everything you charge...$1060...is yours to keep because it is a non-taxable sale.
    That makes sense , but i have another 3,000.00 to 4,000.00 in materials in equipping this truck when it is said and done . It is harder for me to separate the charges . If it was the only item i might do that but i need to keep my records right as well .
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    Sounds like you got a taste of a VAT tax. Here's an article on why it's such a great idea and you should be happy to pay that extra $60..

    Commentary: Why the U.S. Should Adopt a Value-Added Tax - US News
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    Maxwell97 , that is a very interesting article and it is exactly what happened . Further down the chain the price keeps going up and final destination Wham ........................
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    Quote Originally Posted by welder516 View Post
    That makes sense , but i have another 3,000.00 to 4,000.00 in materials in equipping this truck when it is said and done . It is harder for me to separate the charges . If it was the only item i might do that but i need to keep my records right as well .
    All you have to do is breakout the one charge for the generator.

    Labor + tax on labor + Material + tax on material + Non-taxable material (generator) = total cost to your client

    $1000 labor + $60 tax on labor + $4000 Material + $240 tax on material + $1060 Non-taxable material = $6360 total cost to your client

    You then owe $300 to the State...$60 tax on labor + $240 tax on material = $300

    You keep $6060...$1000 labor + $4000 material + $1060 Non-taxable material = $6060

    This is just an example using a 6% tax rate.
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    What is this "sales tax" you speak of?

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    I'm guessing your customer is using this unit for work. Therefore he will now have to charge more to his customers. People just don't understand that that the end user always pays the bill. Hopefully the Honda dealer will be an end user and have to pay more in the end. Most of the general public "Hey raise taxes and stick it to business" then..... "Why address groceries so expensive? " The end user general public always pays it in the end.
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    I don't understand why they are doing this. When you file your MD sales tax on-line there's a line ( I think it's 2a) for tax exempt sales. It's so easy to fill in, what's their point of not doing it?

    Maybe they collect the sales tax but call it a "tax exempt" sale. Keep the tax for themselves as a little perk.
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