Roofers Charging Sales Tax

Roofguy,

We do not invoice separately. We just state we will supply materials to complete the project. If we mark up materials then we are making money on materials. This means you need to charge sales tax.

Wow! What a PIA! In Colo. & Ca. we pay sales tax at point of sale only (w/supplier). Never mess with sales tax BS, other than those that are exempt, (i.e. Amer. Indian properties., etc).

Seems to me that we are in the service industry, not manufacture ir retail. Of course we can add value to a product. But is that the same as re selling the product? Perhaps. Simplest solution to all this bs is the Fair Tax

We supply the material and pay the sales tax at the lumberyard. We get $2 - $2.50 per square foot of plywood replaced.

Residential or commercial. That is all.

Seems to me, the states are creating all your "BS".....Could it be that your state(s) are simply intentionally miss-labeling this "sales Tax" when actually it's a "use tax"? The public will digest easier? Gotta love our gooberments......

twill59 Said: Simplest solution to all this bs is the Fair Tax

Too funny...the "Fair Tax" is a national sales tax. You have yet to explain the sales tax rules for Indiana- a national sales tax would be complicated beyond belief. And Lefty has just given up explaining the PA sales tax.

natty Said:

twill59 Said: Simplest solution to all this bs is the Fair Tax

Too funny...the Fair Tax is a national sales tax. You have yet to explain the sales tax rules for Indiana- a national sales tax would be complicated beyond belief. And Lefty has just given up explaining the PA sales tax.

Not looking to argue. But pray tell how the fair tax would be any more complicated than what we already have :S

Tom, It is no different then what you have to do. If you increase the price of the materials by marking them up, you are selling the materials instead of supplying them. One way you have to charge a sales tax the other you do not. If you charge a sales tax on the materials you also have to charge a sales tax on the labor.

With a non profit it is the same way. File the paperwork and you do not have to pay the sales tax on the materials you supply.

I confess now all y'all have got me confused. In Ca I can assume that if roofing contractors were supposed to be collecting sales tax and paying it in, they'd be all over us on a regular basis. I recall being told many years ago by my accountant at the time that we were considered end users unless we were buying wholesale. Paying the sales tax as an end-user and incorporating that in our service contracts makes the materials incidental and tax exempt. Wholesalers don't pay tax to manufacturers or to what were called "jobbers." They don't collect it from retailers either. Retailers collect it from the end-user, whether it's us or the general public. Essentially we pass the incidental materials on at cost and anything we end up with after all the bills are paid is profit on our service. I haven't spent any time thinking about this issue in the last forty years, but for some reason I suspect Lefty has it right. But if you are going to tax the public for your roofs, then you definitely ought not be paying a sales tax when you buy your materials and if you don't pay sales tax on your materials, then you have to collect it from the public when you sell it. And I can't imagine you could routinely sell your materials to the public at a loss to lower those taxes either. Plus you would wind up having to do regular exacting inventory counts to keep track of every item you bought and haven't yet paid the taxes on. It would be fruitless to quote me cuz I really don't know. And then the laws change. And then they change again. And then again. Remember when every dollar of interest you paid was untaxable?

I think you got it right there Egg.....in several ways ;)

twill59 Said:

Not looking to argue. But pray tell how the fair tax would be any more complicated than what we already have :S

The point of argument is to reveal the truth. An income tax is pretty simple. It is the social engineering that gov't attaches to it that makes it so complicated. If we had a national sales tax, we would still have to file an income tax form so we could get all of those rebates Congress would grant so as to make it "fair".

Yes - Egg has it correct.

Lefty Said: If you charge a sales tax on the materials you also have to charge a sales tax on the labor.

That can't be right. If a homeowner hires lefty to do his roof, there is no sales tax on labor. But, if the homeowner hires Lowes to do his roof, he pays a sales tax on the entire job? That would be unconstitutional- violates equal protection under the law.

Herein lies the beauty of our system and individuality of our Statehood. LOL but seriously at the same time.

It is a flustercluck because sales taxes are imposed by the state. we don't have a national sales tax. Each state is free to set their guidelines as they wish.

In OH, we charge sales tax on the project if we Declare ourselves "tax exempt" at time of material purchase. If we do not Declare as such and pay tax on all material purchases, then we do not have to collect a sales tax from the consumer.

In time, I won't be surprised if we end up with a VAT (value added tax), that we see on every sale, just like in Canada. There will be a federal and state tax line on every receipt. Every time a good changes hand or is improved in some manner, the added value of the good is taxed. Last time I was in Canada, I believe the total VAT was around 14%.

natty Said:

twill59 Said:

Not looking to argue. But pray tell how the fair tax would be any more complicated than what we already have :S

The point of argument is to reveal the truth. An income tax is pretty simple. It is the social engineering that govt attaches to it that makes it so complicated. If we had a national sales tax, we would still have to file an income tax form so we could get all of those rebates Congress would grant so as to make it fair.

Isn't social engineering the point of the present system? Isn't that what has drove us to the extreme edge of nuttiness?