Taxes

[Terry B.]

Re: Many states have a use tax; not just CA

Some states have started taxing cosmetic surgery which I would think is mostly a service. Six percent was one of the tax rates mentioned.

I think taxing services will become normal and another means for the IRS and local governments to get your money.

[Joseph T.]

Re: Many states have a use tax; not just CA

Even Labor gets taxed in Arkansas...Joe

[John H.]

Re: Many states have a use tax; not just CA

Michigan has really come down hard on un-taxed out-of-state phone/internet sales too; four years ago they added a section in the state income tax return for you to pony up state tax on all items purchased from out-of-state where the seller didn't collect Michigan tax and remit it to Michigan. There's a worksheet where they charge you a certain amount (percentage) of your adjusted gross income for this tax; if you don't include the calculated worksheet amount as tax owed on your return, you'll get an audit, and better be able to prove you don't have a phone or a computer

[Steve G.]

Re: Many states have a use tax; not just CA

In Illinois there is a section in the Income Tax instructions that has a use tax form for you to pay Illinois use tax on all items purchased at retail from other states. The only companies that charge Illinois tax are out of state companies that also have a nexus, or physical presence, in the state. Its only fair; out of state retailers should not have a tax advantage by selling to out of state buyers. This hits especially hard on businesses just on the border... Illinois residents buy items in Indiana, Missouri, Kentucky and Michigan, and have them mail it to evade the taxes.
I don't work with Michigan taxes, but I would love to know how they get away with an AGI calculation in an audit situation, especially if the subject had receipts for higher ticket items.