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FLD350
01-31-2012, 08:18 PM
I have to start charging my customers sales tax for the services I offer. This means I will calculate in an extra 6.35% to the total cost of certain services that I already offer to my clients including lawn cuts.

I am afraid that if I tack on this extra amount (even though in some cases it literally is only a few bucks more) that some clients will not take it lightly and may consider dropping me. However, by state law and tax regulation I am required to charge it and I am just following the rules.

My question is has anyone had to deal with this before and any suggestions on how I should propose this to my clients before the 2012 season begins? I don't usually do contracts but I am considering sending out a letter to all my clients before the season starts explaining that I am required to charge sales tax and that the price for certain services will increase accordingly.

I always make sure to go the extra mile and always perform great work for my customers and I hope they will keep this in mind. I will also try to meet some of them halfway but I can not afford to cut myself short due to the fact that I have bills to pay too!

JB1
01-31-2012, 08:31 PM
change your wording first, your not charging, your collecting the sales tax for the state.

weaver
01-31-2012, 08:34 PM
I have to start charging my customers sales tax for the services I offer. This means I will calculate in an extra 6.35% to the total cost of certain services that I already offer to my clients including lawn cuts.

I am afraid that if I tack on this extra amount (even though in some cases it literally is only a few bucks more) that some clients will not take it lightly and may consider dropping me. However, by state law and tax regulation I am required to charge it and I am just following the rules.

My question is has anyone had to deal with this before and any suggestions on how I should propose this to my clients before the 2012 season begins? I don't usually do contracts but I am considering sending out a letter to all my clients before the season starts explaining that I am required to charge sales tax and that the price for certain services will increase accordingly.

I always make sure to go the extra mile and always perform great work for my customers and I hope they will keep this in mind. I will also try to meet some of them halfway but I can not afford to cut myself short due to the fact that I have bills to pay too!

Funny, you are not retail and it's against the law to tax labor!

FLD350
01-31-2012, 08:43 PM
JB1- Good point, sounds better already!

Weaver- I am just trying to comply with my state's tax regulations, if they deem lawn cutting to be a taxable service than I have to collect sales tax on it and anything else that falls into the category for sales tax. Furthermore, I am just looking for a little insight on this and if anyone has any experience with having to explain this situation to their clients??

Richard Martin
01-31-2012, 08:44 PM
Funny, you are not retail and it's against the law to tax labor!

Funny, you're not in Connecticut. Lawn mowing services are taxable there. See page 42 of this document.

http://www.ct.gov/drs/lib/drs/publications/pubsip/2006/ip06-35.pdf

weaver
01-31-2012, 08:49 PM
JB1- Good point, sounds better already!

Weaver- I am just trying to comply with my state's tax regulations, if they deem lawn cutting to be a taxable service than I have to collect sales tax on it and anything else that falls into the category for sales tax. Furthermore, I am just looking for a little insight on this and if anyone has any experience with having to explain this situation to their clients??

Ok just saying in Indiana you can not tax labor. Maybe it's different where you are at. But you are providing a service not a retail shop. Guess i don't know your laws. Sorry!!

FLD350
01-31-2012, 08:49 PM
Funny, you're not in Connecticut. Lawn mowing services are taxable there. See page 42 of this document.

http://www.ct.gov/drs/lib/drs/publications/pubsip/2006/ip06-35.pdf

Haa, Thank you Richard!

I think I forgot to mention this before but I figured it was kind of obvious, I am required to pay "Sales Tax" to CT, which is the reason that I have to collect sales tax from clients now.

FLD350
01-31-2012, 08:51 PM
Yea, in CT services are taxable.

Roger
01-31-2012, 09:06 PM
I have to start charging my customers sales tax for the services I offer. ....

What do you mean by "have to start charging ...?" I know the "charging" has already been discussed as "collecting," but it is the "start" part that is confusing. Did CT just pass a new law about collecting sales tax for the services you perform, or did you just start your business?

In either case, your customers should have no issues with the added line item on their invoice. If the first case, then they will know a new law has gone into effect, and it includes the kinds of services you provide. They will know that in previous years, were were not to collect and remit the sales tax, but in 2012, this is a state requirement. You have good reason to have the line item on your invoice. The change from season to season is easily explained, and something for which you have no control.

If the second case, just starting your business, then you have no past history of charging for service, or collecting the tax. Therefore, the customers should not have reason to compare season over season, because you have no past history with them.

In either case, I don't see why this should be a problem for you. Maybe I have misunderstood your first statement as discussed above.

weaver
01-31-2012, 09:18 PM
Funny, you're not in Connecticut. Lawn mowing services are taxable there. See page 42 of this document.

http://www.ct.gov/drs/lib/drs/publications/pubsip/2006/ip06-35.pdf

Not trying to make no enemies, just did'nt know his State laws and assumed all where like Indiana. Sorry

FLD350
01-31-2012, 09:20 PM
Roger,

I started my business last year, I created an LLC, registered with the state, local and Federal. However, because I am new to the actual "business/tax aspect," of landscaping I failed to realize that I was required to collect sales tax on services that I offer. Like many others I had no idea that Landscaping services were taxable, otherwise I would not be in this predicament.

Consequently I now owe sales tax to the state and now have collect sales tax from my clients for services. To reiterate I am just concerned that this addition to an invoice (although obviously necessary) may be alarming to some of my clients.

weaver
01-31-2012, 09:23 PM
Roger,

I started my business last year, I created an LLC, registered with the state, local and Federal. However, because I am new to the actual "business/tax aspect," of landscaping I failed to realize that I was required to collect sales tax on services that I offer. Like many others I had no idea that Landscaping services were taxable, otherwise I would not be in this predicament.

Consequently I now owe sales tax to the state and now have collect sales tax from my clients for services. To reiterate I am just concerned that this addition to an invoice (although obviously necessary) may be alarming to some of my clients.

The law is the law . Can't se how they would have a problem with it. Just saying..

FLD350
01-31-2012, 09:25 PM
Yea, I agree I guess I'm just a little concerned I have been steadily building my clientele and I would hate to lose anyone over a stupid mistake.

Mahoney3223
02-01-2012, 12:27 AM
If someone drops you over collecting sales tax you probably dont want them anyways.

CLARK LAWN
02-01-2012, 01:06 AM
Watch trying to just hide it as part of the price. Most states require it to be listed as a separate line item.
Posted via Mobile Device

newz7151
02-01-2012, 01:20 AM
Watch trying to just hide it as part of the price. Most states require it to be listed as a separate line item.
Posted via Mobile Device

or have the disclaimer "includes sales tax" or "sales tax included" something along those lines.

Richard Martin
02-01-2012, 02:23 AM
Not trying to make no enemies, just did'nt know his State laws and assumed all where like Indiana. Sorry

You're not making any enemies. :)

One of the rules of life is don't assume that anybody else's situation is just like your own and no other place in the world is just like where you live.

MOturkey
02-01-2012, 09:14 AM
FLD350, we are fortunate here in that "sales" tax is not collectible on services, but I don't know how long that will last. There is a lot of talk of doing away with income tax here in MO, and I know if that happens, the legislature will be looking for ways to get more revenue.

Just a little word of advise. Pay what you owe from last year and be sure and keep accurate records and file in a timely manner in the future. I've owned 3 retail businesses, and have known dozens of people in small businesses, and I'll guarantee you the state will get their money at some point in time, one way or the other. It hurts to send that money in, but as others have stated, it isn't your money to begin with, you are just collecting it for the state, and, if it is like here in MO, they "give" you a small percentage for your trouble.

As for your current customers, that is a sticky one. I see two ways to go. If your profit margin is adequate, you can eat the 6% and not raise the prices on existing customers. Just be sure and check with the state as to how the tax must be handled. In other words, can it just be "sales tax included", or do you have to list the price of the service, then add the tax as an additional item. You can still do this by reducing the actual cost of the service the appropriate amount.

The other way is to simply contact each customer and be honest, saying you were new to the business and didn't realize you had to collect sales tax last season, so you are going to pony up and pay that, but will have to collect it this year. If your pricing is in line, I suspect most will understand, as it isn't going to raise the average mowing by all that much. Good luck.

MOW ED
02-01-2012, 09:44 AM
FLD we have to collect sales tax here in Wisconsin also. I have had only one very old and partially demented senior lady complain to me about it. Her son is a lawyer. I printed out all the sales tax info and gave ot to her. No more complaints. Here is our states PDF on slaes tax;
http://www.dor.state.wi.us/pubs/pb210.pdf

I have this on my web page and also tell all new customers thru the bidding process that sales tax is added to the total for the service so if the cut is $100.00 they will be charged 105.50 and that 5.50 goes to the state.

In my first years I just buried the tax in the price but for book keeping and actual profit is is just good business to break it out seperate. If people don't want to pay it you have to explain its like any other tax, you buy clothes at the department store and you get tax added. It is the way it goes.
Good Luck.

KeystoneLawn&Landscaping
02-01-2012, 09:44 AM
May also be a good time for you to sit down with a CPA and make sure are not missing anything else. Could have been very bad if you had gone many years before realizing the sales tax miss. I also recommend using a CPA for tax preparation. He can also show you how to keep your records. For a solo operator, record keeping is very simple. A CPA will cost you more than a tax preparer but they are worth every penny.

clydebusa
02-01-2012, 10:15 AM
Funny, you are not retail and it's against the law to tax labor!

This is how it is in Oklahoma. No sales tax on labor. No sales tax if you paid the sales tax on buying stuff. If you buy material and don't pay the sales tax then you must collect once you sale to the customer. My CPA has stated never ever get into that mess.

silverado212
02-01-2012, 11:08 AM
In Ohio all provisions involved in the act of lawncare, landscaping and snow removal is taxable. Including labor. You do not pay sales tax on the purchase from a supplier of material ie; mulch, stone, wall blocks etc. That is passed on to the end user. I always inform the client ahead of time. Never been a problem. There are certain things that are non taxable though, building a retaining wall for erosion purposes, soil testing, and others.

Roger
02-01-2012, 11:36 AM
FLD ... thanks for the explanation. I don't see you having a problem. List it as a line item. Yes, you may have a bit of history, but if you have covered those obligations, then you can simply explain "I covered it last season, but am formally collecting the revenues owed to the state." We don't question the local retailer who adds Sales Tax to their ticket, and nobody should question you either.

Kelly's Landscaping
02-01-2012, 11:43 AM
They have required us to collect sales tax here the entire time iv been mowing which is now 23 years I have no idea how much further back it goes. So yes you did make a big mistake not doing it last year in fact the way the state sees it you owe them weather you collected or not. Iv never had any real issues with collecting sale tax. The mob wannabes all seem to ***** about it but most decent citizens realize its their own fault they voted in the tax and spend party and that is exactly what they do here.

Get you sales and use tax permit it allows you to collect the sales tax owed you and allows you to buy stuff whole sale with out paying sales tax to your suppliers. Now I take it you rather small so your probably get the quarterly sale tax plan meaning at the end of every 3 month period you have 1 month to get the sale tax in for the previous quarter. I do miss that for us its now required online filing every month.

One more point do not ever think about keeping that money the state does not take that very well. Iv known a few business's that were very foolish on that point one of them was my former boss. For the first 2 years he was in business he collected 6% sale tax and kept it then one day they came and saw him. Now the state doesn't believe in going through partial records so they estimated the amount they thought he should have been making and then added penalties and interest. They hit him for $48,000 which would have worked out to 800k in sales in 2 years and no one just starting out makes any where near that. And so every week they would send a 400 pound enforcer with no neck to collect. One amusing memory I have was there was 5 of us getting ready for the day and our boss looked up at the road and spotted the state car he dropped to the ground and rolled under the truck and hid behind a wheel while this guy eyed all of us looking for him. Not as good as the time he insulted a tree worked who picked him up by his neck with only his left hand and held him 12 inches off the ground against a building and then cocked his right hand back. It was only his begging for his life and the total disgust that tree guy had for his begging that saved him that day.

CLARK LAWN
02-01-2012, 12:51 PM
or have the disclaimer "includes sales tax" or "sales tax included" something along those lines.

different in all areas, that would not fly here

FLD350
02-01-2012, 02:01 PM
Thanks everyone for the input!

Keystone-I have an Accountant who has taken care preparing the sales tax and my year end taxes.

Kelly- I definitely will be paying CT for the sales tax, as much as it sucks to let that money go I am not trying to cause any problems for myself I just want to be legit and legal. I definitely will have to start collecting the sales tax from my customers and as others have said hopefully they will be excepting of it as it seems everything has a tax on it today!
BTW I thought those stories were hilarious thanks for your 0.02 I really appreciate it

jbell36
02-01-2012, 08:09 PM
if you are supposed to collect sales tax then separate it out on the bill, you must make it a different line item...if you didn't do that last year i honestly wouldn't worry about it because the IRS isn't worried about the little guys...but i would definitely start it now, if you did ever get caught it would be devastating, they will go back i believe 7 years...as for letting your customers know, i would just go ahead and tack it to the invoice and not say anything, it is self explanitory...if anyone questions it just play dumb and say you have to pay sales tax, if they ask why you didn't last year just be honest with them...if you really are worried about it you could send a letter but to be honest that could throw up a red flag to possibly the wrong customer and you could get turned in, whereas if you wouldn't have said anything maybe they would not have even remembered...if you want to pay sales tax for the previous season i understand where you are coming from, it's always good to know you are good with the IRS ha, but in reality they aren't worried about the smaller small businesses...not saying that it won't or couldn't happen but the chances are limited

FLD350
02-01-2012, 08:48 PM
JBell- CT Revenue was actually the one who contacted me and told me that I needed to do something about it, otherwise as you said if I continued to not include sales tax I would definitely run into to some problems years down the road.

I got my sales tax permit, sent in the amount owed for 2010 and more than half of what I owed for 2011. Should be all set in another month or two.

You would think that they wouldn't't care too much about us "smaller companies," but let me tell you the guy I spoke to the Revenue Dept. knew everything about me, kind of scary to be honest. lol

Thanks for the input!

Roger
02-01-2012, 08:53 PM
i......if you didn't do that last year i honestly wouldn't worry about it because the IRS isn't worried about the little guys.......

Clearly, there is still confusion in this thread. Sales Tax is a STATE issue. IRS is collecting taxes for the FEDERAL government. The IRS and collecting taxes for the state do not cross paths.

Return through this thread and read the posts that discuss the uniqueness to STATE. There is nothing related to the IRS. The license to collect Sales Tax is issued on a state by state basis. The revenues collected are submitted to the state.

Threads about Sales Tax are about an numerous as threads discussing "How to take off blades," or "How do you sharpen your blades," or "What is the best mower to buy." The Sales Tax threads have one thing in common: confusion about the agency and governmental agency that pertains to Sales Tax.

MOturkey
02-02-2012, 09:31 AM
Clearly, there is still confusion in this thread. Sales Tax is a STATE issue. IRS is collecting taxes for the FEDERAL government. The IRS and collecting taxes for the state do not cross paths.

Return through this thread and read the posts that discuss the uniqueness to STATE. There is nothing related to the IRS. The license to collect Sales Tax is issued on a state by state basis. The revenues collected are submitted to the state.

Threads about Sales Tax are about an numerous as threads discussing "How to take off blades," or "How do you sharpen your blades," or "What is the best mower to buy." The Sales Tax threads have one thing in common: confusion about the agency and governmental agency that pertains to Sales Tax.

Well said, and let me add that unlike perhaps the IRS, most states DO worry about piddling amounts. If the original poster filed income tax on his business last year, he is exposed, because there is a record of his gross income, and, eventually, the state will come after their share. Much better to be pro-active and contact them with an offer to pay than to eventually have them come after you with penalties and interest.

MOturkey
02-02-2012, 09:35 AM
Just another quick word of advise for those new to business. Keep a separate account for your sales tax revenue and transfer in the required amount after each deposit. The money isn't yours, you are simply collecting it for the state, and I've known more than one person who spent the money, then had trouble coming up with it when it was due, causing major problems instead of minor ones.

Kelly's Landscaping
02-02-2012, 10:39 AM
Just another quick word of advise for those new to business. Keep a separate account for your sales tax revenue and transfer in the required amount after each deposit. The money isn't yours, you are simply collecting it for the state, and I've known more than one person who spent the money, then had trouble coming up with it when it was due, causing major problems instead of minor ones.

Iv never found that part necessary in the 10 years we have been in business now. Now they hit me every month so there's not much chance to spend it but even if you do its quickly replaced as the money flows in. They seem to hit us for 1500-2000 most months. But back in the day when we paid quarterly the amount would hit 4000 plus. Now that drove us crazy you think wow we finally are making a decent profit then all of a sudden you had to write them a check for 5k. I think its more a personal preference as to how good are you at money management. And a lot of people aren't but if you are tracking it in the back of your mind and think I have 10k in the bank but I got these bills coming up in the next 2 weeks for 9k of it you tend to be more grounded in what you can spend.

Richard Martin
02-02-2012, 11:19 AM
And a lot of people aren't but if you are tracking it in the back of your mind and think I have 10k in the bank but I got these bills coming up in the next 2 weeks for 9k of it you tend to be more grounded in what you can spend.

I run a balance sheet and project out months in advance. Are there surprises sometimes? Yes. But never from something that I should have known about.

Kelly's Landscaping
02-02-2012, 12:42 PM
Yea I Rich I got one of those surprises this month when the town/city decided to send me a property tax bill on my new truck rather then waiting till July which is the custom here. Last month I had a good surprise too I sold a truck so the insurance was lowered 460 dollars for the year. So the insurance sent me a letter telling me that and gave me a new balance to pay. {I pay 3 times a year and have 6 months off from Jan-July because that time of the year is to unpredictable for those bills.} Anyways we wrote them a check for the new amount I have a photo copy of it there is no mistaken the amount I wrote. But they entered the old balance and the bank cleared the check for 460 more dollars then it was written for. You could say that was a bit of a surprise we have been in contact since and they are returning it but still you can see if it was a close month that could have caused some serious problems.

Stephen05
02-02-2012, 12:44 PM
Gotta be honest here if your customers cant adapt to that minor change and your service speaks for itself then you may wanna question yourself whether that customer is worth keeping at all.

FLD350
02-02-2012, 09:51 PM
Yes, this is true the sales tax is done state by state and you must register with your state to get a Sales Tax and Use Permit, which allows you to collect the sales tax. (Just learned all of this myself). It has nothing to do with the IRS. And trust me if your state deems that Landscaping is a taxable service and you do not pay the state, they WILL contact you and get their money no matter how small/new of a company you have. I'm still young so I figured as sh***y as this situation is it's better that it happens now and not when I'm 40 years old and have a family to support.

Hopefully my mistake will serve as a lesson to not do the same. Luckily I did address this issue early enough that it will not make or break me, but it certainly does not make my pockets happy!

MV Property Care
02-02-2012, 10:59 PM
Funny, you are not retail and it's against the law to tax labor!

In Pennsylvania it is a sales / service tax. Your basically selling a service. Find that out my first year from my accountant. Funny thing is snow plowing is not taxable. go figure.

ralph02813
02-03-2012, 09:20 AM
Wow, I can feel your pain. I would talk to an accountant on how you balance the sales tax you pay against that that you collect.

Roger
02-03-2012, 08:10 PM
.... I would talk to an accountant on how you balance the sales tax you pay against that that you collect.

Strange question. Why wouldn't you remit every cent that you collect? You are merely the pass-through agent. You can't collect more than what is due for your admin work. I guess you could collect less, and make up the difference from your own pocket. What is due is what is collected for most of us.

Maybe I don't understand your statement. This isn't an accountant question.

DA Quality Lawn & YS
02-03-2012, 11:09 PM
Just another quick word of advise for those new to business. Keep a separate account for your sales tax revenue and transfer in the required amount after each deposit. The money isn't yours, you are simply collecting it for the state, and I've known more than one person who spent the money, then had trouble coming up with it when it was due, causing major problems instead of minor ones.

Yes you have to be smart and make sure you have the quarterly (or even monthly) sales tax funds on hand. However I don't mind making a few dimes on the state's money in between payments.

Kelly's Landscaping
02-04-2012, 12:29 AM
Roger I think you sound like your missing the point he was trying to make. He doesn't get to go back and collect the tax on last year nor did he collect it. So instead he gets to pay it out of his profits which might be enough to have erased his entire year when they get through with him. Hence the suggestion of the accountant was more of a way to negotiate a workable payment plan to get out from under his debt. Then to add insult to injury his customers who have gotten use to not being charged sales tax all last year are now going to be which may cause a few to flee. On top of that he hasn't went through a winter yet so he has no idea what to expect for attrition. I have some customers that see over 100 mailings to get their lawn accounts every year so even a small hick-up like that can sting.

ralph02813
02-04-2012, 04:25 AM
Strange question. Why wouldn't you remit every cent that you collect? You are merely the pass-through agent. You can't collect more than what is due for your admin work. I guess you could collect less, and make up the difference from your own pocket. What is due is what is collected for most of us.

Maybe I don't understand your statement. This isn't an accountant question.

Because I don't remember the way it works - if you pay the sales tax on what you resell, you can recoup it, I am not sure how it works when everything is taxed.

OneLineAtATime
02-04-2012, 06:45 AM
In Ohio you are tax exempt from any material. So when i go to home depot i fill out a tax exempt form and don't pay sales tax. Same with mulch, rock salt, pavers, etc. Now you charge the customer sales tax on the material and labor because you didn't pay it at the supplier. Always remember the rule, the material only gets taxed once. Don't pay tax at the Home Depot then have the customer pay tax again. Uncle Sam getting paid twice.

Now cash job with no receipt gets no sales tax at all, customers love that option and we do to :rolleyes:

Roger
02-04-2012, 07:29 AM
.... Uncle Sam getting paid twice.

....

Still confusion here. The Federal government (IRS) is not involved in the STATE Sales Tax issue. There is no "Uncle Sam" included in any transaction.

Kelly, you may be right about dealing with the past problem, not the transactions going forward. He does not say. Whether past, or future, the issue remains the same. If somebody is unable to take care of those past obligations in the entirety, then I would suggest they are undercapitalized to move forward with their business. Why would there be room for negotiations? Not only is the full amount due, but also penalty and interest will be due. As many posts in this thread state, there is no wiggle room for the State to get what they are due.

orangemower
02-04-2012, 08:26 AM
In Ohio you are tax exempt from any material. So when i go to home depot i fill out a tax exempt form and don't pay sales tax. Same with mulch, rock salt, pavers, etc. Now you charge the customer sales tax on the material and labor because you didn't pay it at the supplier. Always remember the rule, the material only gets taxed once. Don't pay tax at the Home Depot then have the customer pay tax again. Uncle Sam getting paid twice.

Now cash job with no receipt gets no sales tax at all, customers love that option and we do to :rolleyes:

If you paid the sales tax at HD, then you NEED to collect it from the customer to pay your pocket back since you already paid out at HD. This doesn't mean you have to send it in to the state.

fastlane
02-04-2012, 08:58 AM
In Ohio you are tax exempt from any material. So when i go to home depot i fill out a tax exempt form and don't pay sales tax. Same with mulch, rock salt, pavers, etc. Now you charge the customer sales tax on the material and labor because you didn't pay it at the supplier. Always remember the rule, the material only gets taxed once. Don't pay tax at the Home Depot then have the customer pay tax again. Uncle Sam getting paid twice.

Now cash job with no receipt gets no sales tax at all, customers love that option and we do to :rolleyes:
In Pa. if you paid sales tax at HD you still charge the customer the tax. My accountant tells me how much I send to the state.

orangemower
02-04-2012, 09:02 AM
In Pa. if you paid sales tax at HD you still charge the customer the tax. My accountant tells me how much I send to the state.

That's right. Technically you're just getting reimbursed by the customer for paying it at HD.

ralph02813
02-04-2012, 01:23 PM
Still confusion here. The Federal government (IRS) is not involved in the STATE Sales Tax issue. There is no "Uncle Sam" included in any transaction.

Kelly, you may be right about dealing with the past problem, not the transactions going forward. He does not say. Whether past, or future, the issue remains the same. If somebody is unable to take care of those past obligations in the entirety, then I would suggest they are undercapitalized to move forward with their business. Why would there be room for negotiations? Not only is the full amount due, but also penalty and interest will be due. As many posts in this thread state, there is no wiggle room for the State to get what they are due.

That is why I made the comment I did Roger, you need to talk to your account to find out the best way to proceed in your state. It is a pass through tax which only needs to be paid once.

Kelly's Landscaping
02-04-2012, 02:00 PM
Roger I spoke from the experience of watching my former boss get a payment plan to catch up on past years and it lasted for 2-3 years. So yes my state does negotiate to fix problems and will shut you down as a last resort. And if you haven't noticed I am in CT the same as the OP so my take on it is relevant.

We file electronically now and despite the modern marvel of instant communications our state wants the tax in before the last day its due. The trouble is they don't have a set date each month it changes with weekends and holidays and worse still state worker 3 and 4 day weekends that no one else gets. So there have been times when despite getting online 5 days before the end they hit us for penalties. The most ridiculous one was we filed at 5:28 pm Friday only to have them say we were 29 mins too late despite 4 more days in the month and they wacked us a late penalty. But you would be wrong if you think we paid them instead we called up and argued our side and in each case they let them slide. So there is wiggle room for honest misunderstandings.

andyslawncare
02-04-2012, 07:05 PM
We don't have to tax labor either. All materiel are supplied by us, and a job is sold including any required materials required for the service.

Lefet
02-04-2012, 07:25 PM
I didn't read the entire thread, but I believe your question was how do you let your customers know? If you haven't already sent them whatever you're going to send them for the 2012 season, do it and add "+ % sales tax". No big conversations needed. Like what was said, we don't charge tax but we do have to collect it. Same here in Jersey, everything's taxed. We don't even buy wholesale and tax at the end, NJ gets it TWICE! One word of advice: Open a savings account and as you collect the tax, put the money in it so when it's time to pay it, it's there.

Roger
02-04-2012, 10:02 PM
Kelly, I am not surprised the state wants the tax before it is due. They are sticklers in these points.

In PA, we file electronically. I have an ACL transaction established. The due date is the 20th of the month following, or 21st or 22nd if a weekend disturbs the usual schedule. For all the things that don't work well with governments, this system works well. I submit my filing on the 2nd or 3rd of the month following (nothing will change between the 1st and the 20th), with the money transfer on the 20th. I've never had a problem with "late" as their transfer mechanism has always been exactly right. I find the transfer on my bank statement on the exact date expected.

It sounds like CT is depending upon a check from you, a check that may or may not arrive before the due date. The advantage of ACL is the date is invariant, and does not depend upon mails, handling, or other. Since you have had problems, check to see if ACL is available. It may solve some of your problems.

Kelly's Landscaping
02-05-2012, 12:10 AM
Yea the system allows us to set up a payment in the beginning of the month and choose a date at the end of the month that they will take the money out of your account. Which sounds great until you read the fine print on the page that says if they need it they reserve the right to take it at any point in the month they feel like.The bulk of our money comes in between the 10th and 20th of the month last thing we need is having payroll bounce because the state took their money 20 days early. So we play it the other way they cant take it unless you enter it and if its not due till the end of the month that's when we enter it.