Texas Sales Tax
- Thread starter guitarandy
- Start date
guitarandy
Member
Since I would probably buy my cokes from Sam's and pay sales tax there it doesn't make sense to pay it again. Thanks.
You want to be very careful about not paying sales tax. Here in the state of Washington we pay 9.3% on the gross that includes wash bays, vacuums, vending items, soda pop etc. We also pay use tax of 9.3% on anything we buy out of state, like from Kleen-Rite, Windtrax etc. The odds of being audited are small but when you do get audited hang on for one hell of a ride. There was a operator here who didn’t pay sales tax or use tax for almost 12 years. About a year after he sold his wash he gets audited by the state. At first be tried to play dumb said he didn’t have any records anymore, that ****ed off the auditor so they started digging. The interest on top of interest over the years mounts up pretty fast, by the time they got done with him he owed the state a little less than $70K or about 3 times what it would have cost him if he would have pay the tax in the first place. With the sorry state of the economy the state is looking for every dollar this can get, last I heard the state of Washington is going to audit every car wash in the state and I’m sure other states are in same situation.
Whale of a Wash
5 Washes 36Bays 2Vectors
Our state it is really easy to get a sales tax permit, I let the accountant do the paperwork on sending it in.
You can also get an exemption permit to not pay the tax at your sams club, as that would be double taxation.
In the state of Minnesota, I pay sales tax on every $1 taken in-- at 6.875%
We then have a utility exemption--No tax on WSG--Water,Sewer,Garbage.
In our state that is considered the cost of production, many businesses, get that exemption, but then pay the sales tax..
Randy--Check to see if your state will give exemption on WSG. Our state did when i found that out 10yrs ago, and gave a refund for 36 months prior.
You can also get an exemption permit to not pay the tax at your sams club, as that would be double taxation.
In the state of Minnesota, I pay sales tax on every $1 taken in-- at 6.875%
We then have a utility exemption--No tax on WSG--Water,Sewer,Garbage.
In our state that is considered the cost of production, many businesses, get that exemption, but then pay the sales tax..
Randy--Check to see if your state will give exemption on WSG. Our state did when i found that out 10yrs ago, and gave a refund for 36 months prior.
Last edited:
MEP001
Well-known member
If you purchase something and pay the sales tax and resell it retail, you're expected to pay the balance of the tax due. if you get a sales tax permit and purchase something as tax exempt but use it as an item of service, you're still expected to pay sales use tax on it. If you go to the trouble of getting a permit for vending just to pay sales tax, you WILL eventually get audited, and they can demand all your financial records for the last five years. You'd be expected to pay all sales tax due, including items purchased out-of-state and items not meant for resale. Every couple years there's some noise about having car washes in Texas pay sales tax, but it never gets through. Until it does, you're much better off without a tax permit.guitarandy said:
mjwalsh
6 bay SS w/laundromat
Lesser amounts --- better position of strength
I am with Randy & Whale on this one. Ignorance of the law excuses no one. What makes me squirm about the use tax thing is that basically it makes everyone in the state a criminal. Very few people volunteer to track their personal expenses but if they followed the letter of the law they could pick on some poor soul even on his personal purchases of out of state items. The Uniformed Streamlined Tax between states is supposedly making an effort to correct that.
It would be nice if there was some type of threshold before they enforce sales tax on businesses that sell minuscule amounts of items for resale. I would play it safe like Randy suggests rather than taking a chance on being liable for both penalty & some obscene amounts of interest.
I know in 1987 our State of North Dakota had an over $400 million deficit & without the joint efforts of many people taking the time to give good reasons to not expand the sales tax the elected officials would have made it go through. There is no question in 2003 & even at the beginning of the 2005 session there were certain legislators especially from Minot & Fargo that were doing everything in their power to get it to go through on all businesses including that portion of their business defined as labor or service --- gross income.
The point I want to make it that the vending & use tax items are lesser amounts to be liable for. It is much better to stay in good graces with retail people etc. by paying on the retail items & the used tax items. Be thankful that your state has not expanded or reclassified like they have done in other states which as Whale notices is significant on the Minnesota side of our border for car washes. Be vigilant when they start the process of putting the larger tax through! As I am sure Tom Hoffman of New York will acknowledge it is easier to stop it than to try to have it taken off later on. It is key to have the right reasons to stop the more aggressive & much larger tax --- to have the maximum amount of credibility though! At the end of the day you will be protecting both the temporarily misguided leaders, our customers, & yes possibly even our own families etc ----- and the sometimes fragile economy in general.
Last week I was in Minneapolis - St. Paul & happened to visit with the founder of one of Minnesota's largest car wash manufacturers & in my opinion non net income based taxes helped cause layoffs in the manufacturing sector that would not have otherwise occurred! I am trying to look at things from a development & manufacturing perspective also!
MJ
GuitarRandy,
I am with Randy & Whale on this one. Ignorance of the law excuses no one. What makes me squirm about the use tax thing is that basically it makes everyone in the state a criminal. Very few people volunteer to track their personal expenses but if they followed the letter of the law they could pick on some poor soul even on his personal purchases of out of state items. The Uniformed Streamlined Tax between states is supposedly making an effort to correct that.
It would be nice if there was some type of threshold before they enforce sales tax on businesses that sell minuscule amounts of items for resale. I would play it safe like Randy suggests rather than taking a chance on being liable for both penalty & some obscene amounts of interest.
I know in 1987 our State of North Dakota had an over $400 million deficit & without the joint efforts of many people taking the time to give good reasons to not expand the sales tax the elected officials would have made it go through. There is no question in 2003 & even at the beginning of the 2005 session there were certain legislators especially from Minot & Fargo that were doing everything in their power to get it to go through on all businesses including that portion of their business defined as labor or service --- gross income.
The point I want to make it that the vending & use tax items are lesser amounts to be liable for. It is much better to stay in good graces with retail people etc. by paying on the retail items & the used tax items. Be thankful that your state has not expanded or reclassified like they have done in other states which as Whale notices is significant on the Minnesota side of our border for car washes. Be vigilant when they start the process of putting the larger tax through! As I am sure Tom Hoffman of New York will acknowledge it is easier to stop it than to try to have it taken off later on. It is key to have the right reasons to stop the more aggressive & much larger tax --- to have the maximum amount of credibility though! At the end of the day you will be protecting both the temporarily misguided leaders, our customers, & yes possibly even our own families etc ----- and the sometimes fragile economy in general.
Last week I was in Minneapolis - St. Paul & happened to visit with the founder of one of Minnesota's largest car wash manufacturers & in my opinion non net income based taxes helped cause layoffs in the manufacturing sector that would not have otherwise occurred! I am trying to look at things from a development & manufacturing perspective also!
MJ
washme1
Member
One small item to keep in mind is that in my state and I assume most others, can deposits are not taxable. If you sell much canned soda, you may want to track it and deduct from the gross sales at the end of the month. I have a separate line on my Quickbooks sales receipts for can deposits.
mjwalsh
6 bay SS w/laundromat
Washme1,
We have a significant amount of canned pop & juice that we vend through our MDB controlled MegaVendor. I don't believe that North Dakota is a mandated per aluminum can deposit state so it probably does not apply & may never apply to us. Do you just let the machine calculate & post the totals of every can sold & multiply it by a nickel (says on can?) & then subtract it from your gross? In our state juice is not taxed unless it is sold through a vending machine or served for immediate consumption similar to a restaurant. Not fair but way less than the total gross that even includes our bay income like the "not very business friendly" tax required in your state---- so it is better for us to pass on contesting that lesser inequity.
MJ
washme1
Member
In my situation I base it on canned soda purchases since I have no employees drinking the soda and if I have one I purchase it thru the vendor. The sodas go directly into the vendor with just a few left over. Technically, I may be off a few nickels but if ever audited, I would point out that there were a couple of years that I paid sales tax on the can deposits.
