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Posted by RobertM on October 11, 2006, 1:16 am
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>
>>>
>>> As an aside, in my state stuff you buy, to use in your business for the
>>> production of income, is tax exempt.
>>>
>>> If, for example, your company did software development and it was for
>>> this purpose you used the computer, no sales tax is required.
>>>
>>
>> Depends on the state. In Tennessee, they tax everything that doesn't end
>> up on a product that is sold to the customer. For example, if I refinish
>> a musical instrument, I pay tax on the sandpaper and paint brushes but
>> not on the lacquer. With the way this state is, I'm surprised they don't
>> tax me on the volatile lacquer fumes that evaporate during the drying
>> process.
>
> In many states you pay sales Use tax if under normal circumstances you
> would pay sales tax in that state but you did not for some reason. We pay
> sales tax if we buy something tax-free in another state but it is taxable
> in our state. Or in the case of the OP, he purchased it using a reseller's
> ID when it is normally taxable. He is responsible for sending in the tax.
Another thing to consider is that many wholesalers and suppliers require a
sales tax resellers certificate to validate a business but if the items are
purchased from out of state, they aren't on a resellers certificate because
the resellers certificate is only for purchases from within the same state.
Therefore, it is taxable because it's an out of state purchase, not because
it's on a resellers certificate. This is a common reporting error on the tax
form. I'm not saying the OP purchased it from out of state, just adding a
little info here.
Bob
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