WI sales tax questions?

Discussion in 'Starting a Lawn Care Business' started by mkarps, Jun 23, 2010.

  1. mkarps

    mkarps LawnSite Member
    Messages: 57

    I have been just mowing on the side for a while now. I work full time for another company and I do mowing on the side. Should I be collecting sales tax? I have picked up a few more weekly mows this year. I am just doing this a couple nights a week and weekends sometimes. I just filed a DBA and opened business checking so I can have checks made to my business name. I also do a lot of mulching in the spring. I only do around 10k on the side I believe...and yes I did file schedule C last year. If I have to report sales tax can I do at end of tax year? Do I even have to collect it?
  2. meicher806

    meicher806 LawnSite Senior Member
    Messages: 385

    Yes you have to collect it, you should have been collecting it all along. go to this site, fill out the form and you are on your way. http://www.revenue.wi.gov/forms/sales/btr-101.pdf

    they will set up your payment schedual as to when you have to pay in, we have to pay in monthly. I like it that way that way they get their money and it is not sitting in my account tempting me to spend it on something i dont really need... lol
  3. mkarps

    mkarps LawnSite Member
    Messages: 57

    Can I just pay at the end? I am really not doing a ton of business right now as I am still working my full time job. So far I have not been billing my customers. Should I just start collecting sales tax from them next year/write it into the contract? I do a lot of mulch jobs also, do I have to charge sales tax on the mulch I purchase and sell to them--or just the cost to install? If I don't collect it I assume I just pay out of pocket the 5% of my total work done? As I said I shouldn't owe much, any way to just pay it when I file my taxes? I am just trying to make everything legit and I have totally overlooked sales tax to this point.
  4. mkarps

    mkarps LawnSite Member
    Messages: 57

    Also can I just begin paying it in this year? Or start collecting next year? I just registered my DBA and opened my business account a month ago. I also do not have an FEIN tax number. Do I have to get this? I just use my social doing taxes.
  5. djagusch

    djagusch LawnSite Platinum Member
    from MN
    Messages: 4,358

    You can do what you want but you need to understand the repercussions. They can go back years and collect sales tax on past sales if they catch you. The best thing to do is make a date and start doing it the correct way. That way if they do catch you then you have a direct point where you can say you found out and corrected your mistakes.

    Your current questions should be gone past a CPA or start reading at the WI DOR. Either way you need to fix it and it's better sooner than later.
  6. mkarps

    mkarps LawnSite Member
    Messages: 57

    I plan on talking to a tax accountant in a few weeks. I am not charging sales tax currently but if I were to pay in at end of year it would just be the total sales from mowing/dethatching/mulching x 5.1% for my county correct? As I am doing this on the side and do not have much expense at all so far I figure I'll just pay the sales tax out of pocket. I believe my charge per lawn/job even after that should leave plenty of room for profit. Then next year perhaps I will send out a notice with my contracts and hopefully no one will mind. A lot of people like to find a guy on the side as opposed to a big company....sales tax or not I still feel I am that guy on the side.
  7. The mayor

    The mayor LawnSite Senior Member
    Messages: 592

    If you decide ever to get into plowing there is no collecting tax on that though.
  8. AI Inc

    AI Inc LawnSite Fanatic
    Messages: 27,061

    Paying extortion ( sales tax ) for the right to spend ones money is gross.
  9. meicher806

    meicher806 LawnSite Senior Member
    Messages: 385

    I would get set up and start doing it right away, because not only can they go back and make you pay past sale tax; but they will also charge you late fees and penalties, those are going to cost you a small fortune. Also in wi, if you file by a certain date if i recall correctly you get a discount on what you have to pay in. so.... if you don't do a ton of business you may get to charge for it and not have to pay it in.
  10. JayD

    JayD LawnSite Silver Member
    Messages: 2,062

    Wow.....I'm not sure I get all of this, your saying if a guy mows lawns, he is to collect sales tax? But aren't you paying taxes at the end of the year the same thing? So your saying that we are to charge sales tax on labor? But what if you have product like resale of mulch, grass seed or what ever? I thought that you could only charge sales tax on one or the other, not both? :dizzy::dizzy::dizzy:

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