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The Sales Tax Institute is dedicated to
educating business people about sales and use tax concepts and issues. We enable companies
to minimize the tax expenses and administrative costs related to accurate compliance by
offering three training courses throughout the United States.
The course offerings are: E-STI: Sales Tax Concepts online- Introduction, Definitions & Nexus Sales Tax Concepts,
Basics of Sales and Use Tax,
and the Advanced Sales and
Use Tax Workshop.
If you would like more information about
upcoming courses, send a message to courseinfo@salestaxinstitute.com.
The Sales Tax Institute was founded by
Diane L. Yetter of
Yetter Consulting Services, Inc.
HOT NEWS UPDATE: 08/23/2010
California Legislation Would Require Notification to Online Purchasers If enacted, recently passed California legislation would require retailers, who are not required to collect use tax, to provide notification on their retail Internet Web site or catalogue that tax is imposed on the storage, use, or other consumption in California of tangible personal property purchased from the retailer that is not exempt, and is required to be paid by the purchaser. Amendments to the bill over the last few months have eliminated but then returned the rebuttable presumption that any retailer that is part of a controlled group of corporations, and that controlled group of corporations has a component member that is a retailer engaged in business in California, is presumed to be a retailer engaged in business in the State. The original bill included a provision that requires every person who is not registered with the California Board of Equalization (BOE), who sells tangible personal property, the storage, use, or other consumption of which is subject to use tax, to file a use tax report with the BOE. However, at this time, this provision has been eliminated. If passed, this bill would be effective January 1, 2011. (A.B. 2078, passed by the California Assembly on May 6, 2010, Amended June 16, 2010 and June 24, 2010). (08/10) Illinois Business Tax Amnesty Enacted Illinois has enacted additional legislation that requires the Department of Revenue to establish a use tax amnesty program that will apply to all taxpayers including businesses. The Department will offer taxpayers an amnesty period that will run from October 1, 2010, through November 8, 2010. Interest and penalties will be waived for taxpayers who pay all tax liabilities due for any taxable period ending after June 30, 2002, and prior to July 1, 2009. The Department will not seek civil or criminal prosecution for any taxpayer who is granted amnesty during the eligible tax period. Taxpayers with eligible liabilities who do not participate in the amnesty program will be charged double the amount of interest or penalties that would otherwise apply. (P.A. 96-1435 (S.B. 377), Laws 2010, effective August 16, 2010). (8/10) Illinois Individual Tax Amnesty Enacted Illinois has enacted legislation requiring the Department of Revenue to establish a use tax amnesty program for the period January 1, 2011, through October 15, 2011, for individual taxpayers. Under the amnesty program, individuals will not be held liable for interest or penalties or subject to civil or criminal prosecution upon the payment of eligible taxes due for any taxable period ending after June 30, 2004, and before January 1, 2011, subject to certain limitations.
This amnesty program does not apply to businesses or any taxpayers who are a party to any criminal investigation or to any civil or criminal litigation that is pending in any circuit court or appellate court or the Supreme Court of Illinois for nonpayment, delinquency, or fraud in relation to eligible taxes. Amnesty will not be granted to taxpayers who are under audit for eligible taxes or who have been contacted in writing by the department concerning eligible taxes before the taxpayer reported and paid the eligible taxes. However, see information regarding a general amnesty program (http://www.ycstax.com/search.php?newsId=1781) .
The new legislation also allows individuals to report their use tax liability on their standard individual income returns instead of filing monthly use tax returns, beginning with years ending on or after December 31, 2010 , if their use tax liability does not exceed $600. (P.A. 96-1388 (S.B. 459), effective July 29, 2010
Colorado Nexus Presumption Bill Enacted Governor Bill Ritter signed a bill, effective March 1, 2010, that imposes a sales tax collection responsibility on out-of-state remote retailers that do not collect Colorado sales tax. The nexus presumption bill applies to any retailer that is part of a corporate group that includes another retailer with a physical presence in Colorado. As a result, the out-of-state retailer is presumed to effectively be doing business in Colorado. Out-of-state retailers can challenge the presumption by proving that the Colorado retailer (who is part of the same corporate group) did not solicit on their behalf. Affected retailers must notify Colorado purchasers that sales or use tax is due on their purchases and that a sales or use tax return must be filed. Failure to provide notification could result in a penalty of $5 for each failure. The retailer must also notify Colorado customers by January 31 of the year following purchases that sales or use tax is due. The bill authorizes the Colorado Department of Revenue to require out-of-state retailers to submit annual statements summarizing purchases made by Colorado residents. EMERGENCY REGULATION 39-21-112.3.5 was also promulgated by the Department of Revenue further detailing the requirements and the language required to be included on each invoice. (H.B. 1193, Laws 2010, EMERGENCY REGULATION 39-21-112.3.5 ) Oklahoma Passes Nexus Presumption Bill The governor of Oklahoma has signed HB 2359 effective June 9, 2010 which amends the definition of retailer to include remote retailers who are owned by a retailer maintaining a place of business in Oklahoma if the local retailers hols a substantial interest (greater than 10% ownership) and the local retailer sells the same or substantially similar line of products as the remote retailer using the same or substantially similar name. Other specific provisions apply that could establish nexus and therefore a collection responsibility on the remote seller. Additionally, the bill requires remote retailers that are not required to collect tax in Oklahoma to provide notice to customers that use tax applies to the purchases. Retailers are prohibited from advertising that sales tax does not apply to the purchases. The Oklahoma Tax Commission is working on a draft of an emergency rule that would dictate how certain internet and catalog retailers give notice of use tax requirement to customers in Oklahoma. If the retailer does not provide an invoice, a confirmation e-mail containing the notice would be considered sufficient. Online auction websites would also be affected by the proposed rule. The rule’s requirements would not apply to retailers with total Oklahoma gross sales of less than $100,000 in the prior year and the reasonable expectation of less than $100,000 in sales in the current year. The requirements outlined in the proposed rule would not take effect until an emergency or permanent administrative rule is passed. (HB 2359, Press Release, Oklahoma Tax Commission, June 30, 2010) 2010 Tax Holidays Chart updated regularly:Click here for chart Mainstreet Fairness Act introduced in Federal Congress . On July 1, 2010, HR 5660 was introduced by Rep DeLaHunt from Massachusetts which would impose a sales and use tax collection responsibility on remote sales made into states that are full members of the Streamlined Sales Tax Agreement (SSUTA). The bill references the SSUTA and incorporates many of the key provisions. It includes a provision for vendor compensation and a small business exception but does not provide any specifics in regards to these provisions. It also includes in its definition of state, Puerto Rico and the US Territories. It did not specifically address how digital goods should be taxed but did include a provision that each Member States should work with other Member States to prevent double taxation in situations where a foreign country has imposed a transaction tax on a digital good or service. The legislation is supported by the National Retail Federation, Retail Industry Leaders of America, International Council of Shopping Centers, Real Estate Investment Trusts Association, National Governors Association, U.S. Conference of Mayors, the National Conference of State Legislatures, National Association of Counties, and National League of Cities, and over 50 state-level retail associations and chambers of commerce. For a copy of the bill visit http://delahunt.house.gov/mainstreetfairnessact.pdf (H.R. 5660, July 1, 2010) (08/10) New Mexico Amnesty Program Enacted. The New Mexico Taxation and Revenue Department has enacted a temporary tax amnesty program allowing individuals and businesses to avoid paying penalties and interest on any unreported or unassessed taxes due before January 1, 2010. The amnesty period runs from June 7, 2010 to September 30, 2010. Taxpayers who sign an amnesty agreement within that period will not be assessed penalties. In addition, they will not have to pay interest on the tax assessment if the tax due is paid within 180 days. Additional information is available at http://www.taxrelief.newmexico.gov/index.html (Release, New Mexico Taxation and Revenue Department, June 7, 2010). Florida Releases Amnesty Details The Florida Department of Revenue has issued detailed information concerning the tax amnesty program running from July 1, 2010 to September 30, 2010. Tax amnesty applies to state and local option tax liabilities that were due before July 1, 2010. Penalties and 50% of interest due will be waived for taxpayers who are reporting a tax liability previously unknown to the Department or who are responding to a Letter of Inquiry, self-audit or self-analysis. Penalties and 25% of interest due will be waived for taxpayers who are responding to a bill, delinquency, audit, or other assessment issued by the Department. Eligible taxes include, but are not limited to, sales and use tax, communications services tax, estate tax, and motor fuel tax. A complete list of eligible and non-eligible taxes, along with participant eligibility requirements can be found on the Florida Department of Revenue’s website (Facts About Florida’s Tax Amnesty, Florida Department of Revenue, June 11, 2010).
Internet Transactions Resolution Program Announced in North Carolina In collaboration with e-commerce retailers, the North Carolina Department of Revenue has developed the Internet Transactions Resolution Program. Participants may resolve their prior tax liability by registering for sales and use tax and agreeing to collect and remit those taxes for four years, beginning September 1, 2010. Any retailer that failed to register for sales and use tax as a result of operating an affiliate program in North Carolina at any time is eligible to participate. The Department will not assess tax, penalties or interest for periods prior to September 1, 2010 for retailers that successfully complete the program. Also, the Department will not obtain consumer information from the retailer to collect a tax liability for the period prior to September 1, 2010. The program begins on April 23, 2010. Eligible retailers must submit an election to participate by June 30, 2010. A resolution agreement must be signed by both the retailer and the Department by August 31, 2010 Internet Transactions Resolution Program, North Carolina Department of Revenue, April 23 , 2010). Nevada Approves Tax Amnesty The Governor of Nevada has signed a bill that authorizes a tax amnesty program that will run from July 1, 2010 through October 1, 2010 for taxes, fees, and assessments that are delinquent as of July 1, 2010. All interest and penalties will be waived for taxpayers who file a request for relief with the department and pay the unpaid liability in full by October 1, 2010. Specific rules regarding the amnesty program have not yet been announced. (Ch. 10 (A.B. 6), Laws 2010, Special Session, effective May 1, 2010. Maine Announces Amnesty Initiatives Maine has announced two tax amnesty initiatives that will run from September 1, 2010 through November 30, 2010. Under the “short-term initiative” 95% of penalties will be waived on taxes assessed as of December 31, 2009. Under the “five-year initiative”, 95% of penalties and interest will be waived on taxes assessed as of June 30, 2005. Participation in the initiatives is conditioned upon the taxpayer’s agreement to forgo or withdraw a protest, administrative or judicial proceeding, or refund claim relating to liabilities paid under the initiatives. Additionally, to be eligible, a tax payer must properly complete a file a 2010 tax initiative application, pay all tax, interest, and penalties, and not have criminal action or collection by warrant or civil action pending. (L.D. 1671 (H.P. 1183), Laws 2010, effective March 31, 2010) |
