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edgeman2003
04-07-2008, 12:40 PM
I called the local government office to see if I need a business license. They told me no because I don't sell products only offering a service. I was wondering do I need to pay sales tax, which is 6% in maryland? they didnt know for sure if I had to pay them or not. I live and work in maryland.

ALC-GregH
04-07-2008, 12:47 PM
not unless your selling a product. If you buy a load of mulch, your better off paying the sales tax (if there is tax on it) and be done with it rather then not pay the store and have to submit it yourself. Plus, it's one more thing you have to account for in your gross income that needs to be paid. It's not your money when you collect sales tax and some have fallen victim to not paying it and using the money for something else. At that point, you'll have to pay it regardless and it could easily put you in a bind.

edgeman2003
04-07-2008, 12:50 PM
not unless your selling a product. If you buy a load of mulch, your better off paying the sales tax (if there is tax on it) and be done with it rather then not pay the store and have to submit it yourself.

so you just charge the customer flat cost?

ALC-GregH
04-07-2008, 12:52 PM
If your doing a mulch job, yes. Thats if the tax is already paid.

edgeman2003
04-07-2008, 12:52 PM
they told me I can just use my ssn for the business since Im a sol pro. but I think for my bank, I need an ein # to open an account.

ALC-GregH
04-07-2008, 12:54 PM
if you do not pay the tax, you'll need to include it on the bill to the customer. At that point, you'll be liable to pay in the sales tax and that will require a sales tax ID #

ALC-GregH
04-07-2008, 12:56 PM
your SS# is your business tax ID #. Or the governments way of collecting your personal taxes that you'll need to pay. You should get a DBA # to use for your bank account I believe.

Ok, now that I have this straight, your "entity" # or DBA # is the # you'll need to open the bank account. Not you SSN.

edgeman2003
04-07-2008, 01:04 PM
your SS# is your business tax ID #. Or the governments way of collecting your personal taxes that you'll need to pay. You should get a DBA # to use for your bank account I believe.

whats a DBA #?

Paulup
04-07-2008, 01:05 PM
according to Marylandtaxes.com "charges for repairing or restoring an existing item of tangible personal property to its original condition are not subject to tax. A charge for reconfiguring or enhancing existing tangible personal property, unless it results in the creation of a new and different item of tangible personal property, is also not taxable."

In Louisiana, you do not have to charge sales tax on any service with the exception of dry cleaning, unless it is the installation of a movable object, or repair to a movable object.

ALC-GregH
04-07-2008, 01:07 PM
DBA= "doing business as"

ALC-GregH
04-07-2008, 01:13 PM
Only products and merchandise can be taxed. Nothing on labor or services. Thats why it's better to pay the sales tax on the product before hand rather then collect from the consumer. Doing it this way, you'll have one less headache to worry about.

LawnCare_EMT
04-07-2008, 02:34 PM
You do not need an EIN#, contact the County Courthouse and get a DBA. Take the paper DBA to the bank and they will be ablet o open up a business checking with that.

Paulup
04-07-2008, 03:04 PM
You do not need an EIN#, contact the County Courthouse and get a DBA. Take the paper DBA to the bank and they will be able to open up a business checking with that.

Some banks are phasing out DBAs(Capital One Bank is one of them), so it might not be that simple depending on where you do your banking.

Remember, starting an LLC is cheap, and it removes the personal liability from running your business. Well worth the 100 bucks it costs to form the LLC, imo.

prizeprop
04-07-2008, 06:21 PM
I called the local government office to see if I need a business license. They told me no because I don't sell products only offering a service. I was wondering do I need to pay sales tax, which is 6% in maryland? they didnt know for sure if I had to pay them or not. I live and work in maryland.When asking a sales tax question,Be careful taking advise from people out of state.Every state is different in how they collect sales tax.In NJ we collect on just about every thing now.Maryland is probably different than Pa.

daveintoledo
04-07-2008, 09:13 PM
Only products and merchandise can be taxed. Nothing on labor or services. Thats why it's better to pay the sales tax on the product before hand rather then collect from the consumer. Doing it this way, you'll have one less headache to worry about.

stop giving advise when you dont have a clue....

it depends on the laws of your state, Ohio, among many other states service is subject to sales tax , along with bush trimming, snow plowing and many other services including nail and hair salons,

EVERONE< check with your state to ask thes questions, all the state websites are easy to navagate......

CLARK LAWN
04-07-2008, 09:53 PM
Only products and merchandise can be taxed. Nothing on labor or services. Thats why it's better to pay the sales tax on the product before hand rather then collect from the consumer. Doing it this way, you'll have one less headache to worry about.

doing it that way is probably illeagle. why should i pay the tax that would be a customers resposablity? people like you are the reason its so hard for the rerst of us.

mngrassguy
04-08-2008, 05:04 AM
Or you could do it like I did. Ignore it and wait till the state catches up to you. Then pay the fine and back taxes (about $5000.00) within 30 days:cry:

Do what Dave says, see http://www.revenue.state.pa.us/ Do it right the first time.

Federal EIN's are for employers only but you can get one even if you have no employees. Some states AND bank require them. See IRS.GOV to apply for one.

You should register your bus with the state first in case your name has been taken.

Slcareco
04-08-2008, 04:29 PM
In New York you have to charge sales tax even for services rendered every month..... damn new york!

ALC-GregH
04-08-2008, 04:51 PM
I apologize for any in-correct information that I may have posted.
I stand corrected and appreciate your help. I don't intend on doing business illegally and will have everything to be legit. There's so much to consider, it's making my head spin. Again, sorry.... I'm heading back to the drawing board. :walking:

Also Clark, I haven't even started cutting any lawns, including my own! I'm as green at this as the grass is your cutting.

WildLake
04-08-2008, 07:43 PM
you need to file for a trade name. that will be you dba name. search sdat and maryland and you will find the info. i cost maybe $50, but that will get you what you need for the bank and you cam pick any name thats not taken aready.
http://www.dat.state.md.us/sdatweb/sdatforms.html
choose trade name reg.

J.A.G LAWNCARE
04-08-2008, 10:18 PM
OHIO you need to charge the sales tax rate for the area you are doing the work in .....
the rate i work in is 6.25% SO if I charge $100 the customer gets billed $106.25 then monthy i send the sales tax in to the state $6.25