State Use Tax

[magsgma]

I received a letter yesterday from the State Dept. of Revenue.
It starts off stating:
"To ensure every individual and business taxpayer pays his or her fair share of use tax, thereby keeping the tax burden reasonable for everyone, the Department of Revenue regularly evaluates use tax filings. Our records indicate your company has not reported or remitted use tax in the past three years. Please review the following and enclosed information, and then evaluate your purchase invoices for the current year and the previous three years to determine if you have a use tax liability. There is a lot more but I have been in business for 18 years and never got a letter like this before, nor do I file a use tax or do I --- I do file State taxes.
They supplied a list of tangible property that is subject to use tax like Computers, Furniture, Office Equipment, Administrative Supplies Printed Matter, Cleaning supplies etc.
As well as Services such as lawn care, cleaning, pest control to name a few.
Am I the only one who is baffled by this?
Are they telling me I owe yet another Tax? Heck just let me sign my check over to the government. I am all for paying my "fair share" but this isn't this a little crazy!?!

[TomCopeland]

Use Tax

This is not uncommon. States and cities are looking for ways to make more revenue. They can charge a tax on the property you are using in your business. You want to find out if what they are referring to really applies to family child care providers. Ask to see the law to see if it covers you. It may. If so, you should only be paying tax on the business portion of the items they want to tax. That is, the time-space portion. If your time-space percentage is 40% and you have a $1,000 sofa, you should only have to pay tax on $400.

If you get a copy of the law and are not sure if it applies to you, contact me and I'll help interpret it. [email protected]

[snbauser]

We have that here. It is a Business Property Tax by our county.

[magsgma]

This is not uncommon. States and cities are looking for ways to make more revenue. They can charge a tax on the property you are using in your business. You want to find out if what they are referring to really applies to family child care providers. Ask to see the law to see if it covers you. It may. If so, you should only be paying tax on the business portion of the items they want to tax. That is, the time-space portion. If your time-space percentage is 40% and you have a $1,000 sofa, you should only have to pay tax on $400.

If you get a copy of the law and are not sure if it applies to you, contact me and I'll help interpret it. [email protected]

God Bless you Tom - I will check into that - thank you!
~~BTW I took the webinar you gave yesterday -- GREAT webinar. I have been a provider for 18 years and always use your books and info but there is always something to learn. The webinar pointed to some things that I didn't eve realize AND validated some of the policies that I do have (and enforce)