Are FFL Transferrers supposed to charge tax?
Almost every FFL transferrer in my area is charging sales tax, whats up with that, are they being shifty or is that the norm.
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If you are concerned whether his collecting tax on the transfer fee is legit, write your state tax office and tell them what he's doing and get a ruling on it. If he's cheating, he will be audited. 0 -
quote:Originally posted by damdanger
Just to be clear, they are asking for sales tax on the gun..
In many states you will have to pay sales tax on the transfer. If you bought a gun say from GB and sent the buyer payment directly there is no way for the dealer to collect sales tax (to pay to the state of course) on the gun since he did not sell it. If you bought a gun (even here on GB) and for some weird reason gave the money to the local dealer to pay for your gun then you may have to pay sales tax.
The dealer has no way to know what you paid for your gun. Tell him you got it for a $1 on one of the great penny auctions here on GB and pay him $0.10 for the tax (that should cover it). Tell him the gun is coming from a friend for free but you want to be legal and that is why you are doing the 4473. The dealer has no way to prove otherwise.0 -
My CPA has contacted the State of Washington Revenue Service and confirmed that sales tax is not required to be collected for a non sale service such as a state to state firearm transfer. 0 -
quote:Originally posted by Nwcid
quote:Originally posted by damdanger
Just to be clear, they are asking for sales tax on the gun..
In many states you will have to pay sales tax on the transfer. If you bought a gun say from GB and sent the buyer payment directly there is no way for the dealer to collect sales tax (to pay to the state of course) on the gun since he did not sell it. If you bought a gun (even here on GB) and for some weird reason gave the money to the local dealer to pay for your gun then you may have to pay sales tax.
The dealer has no way to know what you paid for your gun. Tell him you got it for a $1 on one of the great penny auctions here on GB and pay him $0.10 for the tax (that should cover it). Tell him the gun is coming from a friend for free but you want to be legal and that is why you are doing the 4473. The dealer has no way to prove otherwise.
Until the dealer returns it to the sender for lack of bill of sale or invoice.
I never realized how many CPA's & tax lawyers who specialize in MI tax law there are here on GB! Gezz, if I would have know this 15 years ago (thats right, before GB) when the state first let me know that I had to collect on SGN & GL transfers, I would not have had to pay all the sales tax due out of my pocket!
Now, who want to send me a letter stating their intent and ability to represent me (pro-bono) when the state decides to audit me?
Don
Edit:
Here is more from MI department of treasury:
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quote:Originally posted by MVP
My CPA has contacted the State of Washington Revenue Service and confirmed that sales tax is not required to be collected for a non sale service such as a state to state firearm transfer.
To bad you can't own machine guns, we can in Michigan[;)][:D][:0]
Don0 -
O.K. , this is one of those items that will get a zillion responses !
Yes every state I know of has a business charge 'sales tax' , but each state is different as per rules and reg.s and spec.s on this , we Do Not Collect Sales Tax on Transfers (the transfer is a service,we are NOT required to collect 'sales tax' on services)...
We charge a flat fee of $20.00 (plus 10 for the background check) for all transfers ...
Thanks !!!
d.a.stearns
Gunsmith / LEO
Niota , Tn0 -
quote:Originally posted by dongizmo
quote:Originally posted by MVP
My CPA has contacted the State of Washington Revenue Service and confirmed that sales tax is not required to be collected for a non sale service such as a state to state firearm transfer.
To bad you can't own machine guns, we can in Michigan[;)][:D][:0]
Don
[:D]0 -
Dongizmo-
I do see one thing in the letter that I do not understand and I am not trying to argue, just seems strange to me.
They stated that the FFL that the firearm is being transfered to is an agent of the FFL that is shipping the firearm.
I thought the receiving FFL is approached and hired by the actual buyer and not the shipping FFL so wouldn't that make the receiving FFL an agent to the actual purchaser and not the random out of state seller?
The out of state seller has no choice as to which FFL the Actual buyer chooses to transfer the out of state firearm.
Like I said I read the letter and see where you stand I just thought that was strange for the Government to word it like that.0 -
Let's review again..
http://forums.gunbroker.com/topic.asp?TOPIC_ID=2497190 -
quote:Originally posted by MVP
Dongizmo-
I do see one thing in the letter that I do not understand and I am not trying to argue, just seems strange to me.
They stated that the FFL that the firearm is being transfered to is an agent of the FFL that is shipping the firearm.
I thought the receiving FFL is approached and hired by the actual buyer and not the shipping FFL so wouldn't that make the receiving FFL an agent to the actual purchaser and not the random out of state seller?
The out of state seller has no choice as to which FFL the Actual buyer chooses to transfer the out of state firearm.
Like I said I read the letter and see where you stand I just thought that was strange for the Government to word it like that.
On the phone they explained it as the recieving MI FFL is the sellers agent. Mi already requires a individual to pay sales tax on out of state purchases,(it's on the income tax return) since the FFL must have a sales tax license, he becomes the point of collection.
50 States, 50 rules[:D] I follow what MI requires.
Any FFL who is not collecting (sales tax)in MI has just not been stuck with the tax bill yet, in time they will.
Don0 -
Yes if they are going to count the funds they received as earned income, and I believe they are required to do just that.
Trinity +++0 -
MVP,
Washington State's law will change in July, 2008.0 -
quote:The dealer has no way to know what you paid for your gun.
Nearly every gun I have purchased on-line is shipped with the invoice witht the gun. My trasfer ffl is certainly going to see it, as he must look at the gun to confirm serial number and that it is what it is purported to be.
That said, in New Mexico a trasfer ffl can charge tax only for the trasfer service, and all I know of include the tax in a flat trasfer fee.0
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