The Use Tax

[Craig234]

TurboTax made it clear this year: Did you buy anything from out of state that you used in your state and did not pay sales tax on?

You can pay or you can lie.

The Use Tax, passed in 1935, requires that if you buy something - by mail, phone, internet - from out of state, you have to pay the same tax as the sales tax.

(For me, that's 8.75%).

Thousands on a new big screen? Thousands to Amazon? All you owe taxes on now.

The point of this thread: the lack of enforcement is a big problem - it becomes a tax on the most honest taxpayers, where probably 98%+ don't pay it.

I don't like that. It makes criminals (if they lie) or fools (if they pay) of the taxpayers.

Just thought I'd mention it as 'a problem' going on now. Currently, I plan to declare several thousands in purchases I didn't realize were taxable, and pay the tax.

It's one thing when you 'pay your fair share', though, and another when you are one of very few paying.

 

[StageLeft]

You live in California and are going to declare this to pay it, as legally asked, despite enforcement being really quite impossible?

This is why if you live in NY you have to pay tax when you buy on Amazon (and some others).

 

[frostedflakes]

So how many others actually pay use tax? I didn't think anybody actually did.

It's definitely impractical/impossible to enforce. I'd image it's only a matter of time before states close the online sales tax loophole.

 

[Craig234]

Originally posted by: Skoorb
You live in California and are going to declare this to pay it, as legally asked, despite enforcement being really quite impossible?

It's not that I want to, and I could make some rationalization about the law being unjust, but I'm not one to lie about it, and that is weghing most heavily as the issue now.

Don't get me wrong, I think taxes are very useful and am fine paying 'my fair share', even to the point where if I can spend an extra couple dollars and get my state some extra money (say $200+ $15 shipping no tax vs. $200 + free shipping $17 tax), I'd likely pay the extra couple dollars to get them the $17 in taxes. But this is unfair.

 

[Craig234]

Originally posted by: frostedflakes
So how many others actually pay use tax? I didn't think anybody actually did.

It's definitely impractical/impossible to enforce. I'd image it's only a matter of time before states close the online sales tax loophole.

IIRC, 30,000 returns out of 10 million paid it last year.

 

[CPA]

Texas has it as well. For out of state purchases it's called Occasional Use Tax. My guess is 99.9999999999999999% of people don't file and pay this tax.

 

[soccerballtux]

Interstate [internet] commerce up to federal government-- this just in, CA is not the federal government.

 

[winnar111]

The higher they make sales tax, the more likely people are to avoid it.

 

[HappyPuppy]

Heh, heh, heh, as a resident of California I will screw them out of every penny I can. They may have the legal right, but that doesn't give them the moral right to take my money. If they catch me I will pay what I owe plus penalties and interest, but they have to catch me first. Fuck them. It is the right of every citizen to avoid taxation they deem not RIGHTEOUS!

 

[Zebo]

I hope you get audited for being a idiot.

I personally focus every purchase possible online even steaks to avoid the regressive sales tax even though about 80% of what I buy is fully deductible anyway you still have to make to spend it why make it more. Nope sorry I won't sit in the back of the bus either.

 

[Slew Foot]

CA would just spend it on stupid shit like condoms for illegals or condos for endangered species of rats.

 

[brownzilla786]

Originally posted by: HappyPuppy
Heh, heh, heh, as a resident of California I will screw them out of every penny I can. They may have the legal right, but that doesn't give them the moral right to take my money. If they catch me I will pay what I owe plus penalties and interest, but they have to catch me first. Fuck them. It is the right of every citizen to avoid taxation they deem not RIGHTEOUS!

At a boy! Stick it to the man!

 

[mugs]

Originally posted by: Zebo
I hope you get audited for being a idiot.

I personally focus every purchase possible online even steaks to avoid the regressive sales tax even though about 80% of what I buy is fully deductible anyway you still have to make to spend it why make it more. Nope sorry I won't sit in the back of the bus either.

:laugh: You think too highly of yourself and your personal war against sales tax.

 

[Zebo]

Originally posted by: mugs

Originally posted by: Zebo
I hope you get audited for being a idiot.

I personally focus every purchase possible online even steaks to avoid the regressive sales tax even though about 80% of what I buy is fully deductible anyway you still have to make to spend it why make it more. Nope sorry I won't sit in the back of the bus either.

:laugh: You think too highly of yourself and your personal war against sales tax.

Yeah it's a pretty weak justification I admit Really like Craig says only reason its the odds and everyone does it, no one likes paying taxes, especially Obama Appointees , so most skirt where they can. I don't feel bad about it for some reason with crooks at the top.

 

[gevorg]

So they expect me to track and remember every online purchase I made?

 

[Jack Flash]

Originally posted by: gevorg
So they expect me to track and remember every online purchase I made?

Not that that is difficult.

Credit Card statements are electronic.
Email receipts of invoices.

Not saying I'd pay use tax on things I purchased from Amazon.

 

[Thump553]

I suspect this is the law in every state that collects sales tax. It has been the law in my state (CT) for at least several decades.

Every once in a while my state's dept. of revenue grabs (or attempts to grab) records from large, out of state mail order or internet vendors-like furniture outlets in North Carolina, for example. Just think if the states were able to grab the records from just the top five online vendors-the revenues would be tremendous to the states. It would also severely hurt online sales-thus the line is drawn for big fights in Congress about this.

 

[halik]

Michigan has had this for a while, coincidentally I don't recall buying anything from out of state. Same goes for used car sales tax.

 

[StageLeft]

Originally posted by: halik
Michigan has had this for a while, coincidentally I don't recall buying anything from out of state. Same goes for used car sales tax.

lol

 

[Thump553]

My state got around the used car tax scam in private sales by billing the buyer sales tax based on bluebook value at the time of registration.

 

[imported_Lothar]

Originally posted by: Thump553
My state got around the used car tax scam in private sales by billing the buyer sales tax based on bluebook value at the time of registration.

So if I sell my '97 Honda Accord to my brother for a buck, your state will still charge him based on book value when he goes to put the registration in his own name?

 

[Thump553]

Originally posted by: Lothar

Originally posted by: Thump553
My state got around the used car tax scam in private sales by billing the buyer sales tax based on bluebook value at the time of registration.

So if I sell my '97 Honda Accord to my brother for a buck, your state will still charge him based on book value when he goes to put the registration in his own name?

Yes, but there is an exception-no sales tax for parent to child or sibling to sibling transfers.

Before they adopted this procedure it was quite common for people to walk in with ridiculously low bills of sale, claiming body damage or something. Then the DMV asked for a copy of the money order/canceled check used to buy the car-people would just get two money orders. They adopted the bluebook procedure about a decade ago.

 

[ElFenix]

Originally posted by: CPA
Texas has it as well. For out of state purchases it's called Occasional Use Tax. My guess is 99.9999999999999999% of people don't file and pay this tax.

i'm going to guess the vast majority of people aren't aware of it. we don't even have state individual tax returns so it's not like a box that you look at and think, 'what is that?'

 

[thirtythree]

I paid mine for my Amazon purchases (really all I buy online).

 

[halik]

Originally posted by: Thump553

Originally posted by: Lothar

Originally posted by: Thump553
My state got around the used car tax scam in private sales by billing the buyer sales tax based on bluebook value at the time of registration.

So if I sell my '97 Honda Accord to my brother for a buck, your state will still charge him based on book value when he goes to put the registration in his own name?

Yes, but there is an exception-no sales tax for parent to child or sibling to sibling transfers.

Before they adopted this procedure it was quite common for people to walk in with ridiculously low bills of sale, claiming body damage or something. Then the DMV asked for a copy of the money order/canceled check used to buy the car-people would just get two money orders. They adopted the bluebook procedure about a decade ago.

Wow what a racket, the sales tax has been paid many times over.