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Sales tax on Scarlet purchase?

Omar N

Omar N

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Hello everyone,

The idea of sales tax just caught my attention! Can anyone confirm if there is sales tax when shipping domestic? It may sound like a silly question but I am not used to paying tax for online orders which is why it caught me off guard. It could add yet another thousand dollars to the price!:scared:
 
Thanks guys!
 
Isn't there some sort of sales tax reduction that applies to equipment used in a business if you file the proper papers?
 
Generally speaking, a vendor does not charge tax when they sell and ship an item to a state where they're not physically doing business (or something very similar). I sometimes have large B&H purchases I make shipped to a friend in NJ where B&H doesn't operate because they don't charge me tax when I do so. He brings them to me or I go get them, assuming I've made a purchase big enough to justify the gas, traffic and tolls.


Omar N said:
Hello everyone,

The idea of sales tax just caught my attention! Can anyone confirm if there is sales tax when shipping domestic? It may sound like a silly question but I am not used to paying tax for online orders which is why it caught me off guard. It could add yet another thousand dollars to the price!:scared:
Click to expand...
 
RED does not operate in IL, does that mean I am exempt from tax? The website says that tax will be applied "if applicable." What does that mean?

Man...sometime I wish I went to law school. :)

RED.com says: "On this order, your BOMB SQUAD rep will discuss shipping and handling options with you before your order ships. At that time, your balance due will include actual shipping and handling and sales tax (if applicable)."
 
If you live in IL Red won't charge a sales tax but you'll need to report the sale to IL and pay whatever sales Tax is applicable. Depending on IL you might be able to write off the sales Tax. Also thanks to the Stimulus Act you might be able to write off the purchase of new equipment or a business, not sure about the details though.

As with all such things it's worth it to talk to a local accountant who could walk you through the specifics to not get hit with a penalty for failing to report a purchase or miss out on a big deduction. If you can write off a $15k purchase over a couple years that could save you $3k in taxes over a couple years.
 
Omar N said:
RED does not operate in IL, does that mean I am exempt from tax? The website says that tax will be applied "if applicable." What does that mean?

Man...sometime I wish I went to law school. :)

RED.com says: "On this order, your BOMB SQUAD rep will discuss shipping and handling options with you before your order ships. At that time, your balance due will include actual shipping and handling and sales tax (if applicable)."
Click to expand...

No, it means Red will not charge you tax. You are not exempt and are still obligated to report it locally.

oops, Gavin beat me and gave a better explanation.
 
There is also a form your Bomb Squad Rep can give you for a production tax credit that drops it 5% or a little more. Can make a pretty big difference in your delivered price.. IIRC it is 6732 form or deduction.

You complete in once and Red keeps it on hand for you when you order again.

This applies to orders placed in and delivered in California.
 
If the tax ends up being too much, is it too late to cancel the order once the bomb squad rep contacts me? I know that the deposits are refundable but I am wondering what the point of no return is.

Also, what is production tax credit? Why would not every one just do that?
 
Stacey Spears said:
Yes for Washington state.
Click to expand...

Do they automatically cover it? I remembered Washington being listed as an incorporation location for RED. Does that mean I don't need to report it locally? Also do you know if Washington has Sales Tax excemptions for business purchases?


And to your question Omar, I would expect it to be around 8-9% and yes your deposit is refundable if that's too much. And I believe that 5% tax reduction is only for California Residents although IL may have something similar. For example Washington I know has this http://dor.wa.gov/docs/pubs/specialnotices/1997/sn_97_mopic.pdf but I believe it only covers rentals not purchases.
 
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