NFOA MEMBERS FORUM
General Categories => Newsworthy => Topic started by: Lmbass14 on December 23, 2016, 06:39:11 PM
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Saw on WOWT news that Amazon will start charging sales tax in NE as of Jan. 1, 2017. Sad to see it, but at least I don't spend a ton of money there.
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I cant imagine the sales tax having much if any effect on our usage of Amazon, the free shipping ( with Prime ) will offset the tax, AND it comes to my door!!
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It has been the Ne Dept of Rev's desire to collect internet sales tax for several years and there are NE laws on the books which require citizens to report their internet purchases and pay taxes on them according to the city rates they live in.
http://www.revenue.nebraska.gov/info/consumers_use.pdf
I've been paying taxes on my Amazon purchases for several years. Other Internet sales outlets already collect taxes for Nebraska.
Amazon Prime sales aren't necessarily a good deal. Many prime prices are identical to 3rd party sales prices PLUS shipping, so shipping isn't really free on many Amazon Prime items.
Since my wife and I haven't watched many Amazon movies over the last two years I've decided to cancel the Prime service before it comes due this April.
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Amazon Prime sales aren't necessarily a good deal. Many prime prices are identical to 3rd party sales prices PLUS shipping, so shipping isn't really free on many Amazon Prime items.
True, but not many will have them to you in 2 days! Many of the things I buy on prime are at least as good a deal as companies that ship whenever they get around to it and some actually are better. My kids watch the video more than I do but we have Netflix as well. Each has content that the other doesn't.
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I use Amazon for two things:
- Books, movie DVDs and music CDs. I have had good luck buying used with a quality rating of Very Good or better.
- Customer reviews of products I end up buying elsewhere. It's the reverse of checking out a product in a local brick and mortar store but buying it on line at a lower price.
Amazon Smile is a way to get them to donate a small fraction of your purchase to the organization of your choice.
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I will add that Amazon customer service is very hard to beat when it comes to returns or defective items and will continue to be my preferred provider for internet shopping, but then I have paid use tax for these purchases so my cost will not be going up next year
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i like the Amazon trade in. it usually beats selling a used textbook there than back to the bookstore. i cleared my shelves of CDs, DVDs, Blurays and books that i didn't need anymore. the books are the best price, but CDs/DVDs/Blurays usually don't give you much, but if you have Prime and Netflix, you're not watching disc's much anymore.
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If you use Chrome, there is an app you can add called Wikibuy. When you select a specific item on Amazon (and other sites) in just a few seconds it will tell you if there is a better deal available somewhere else.
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I forgot to mention that NE will be collecting past history from Amazon and other Internet sales outlets and matching up reported internet sales with actual Internet sales. If you haven't been reporting Internet sales taxes expect a letter from the Dept of Revenue sometime in the future. They'll probably offer an amnesty period. After that the penalties for under reporting will be significant. I wrote the code for comparing incomes reported on the fed form with that on NE's form. Several thousand cheaters were found and prosecuted.
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I wonder how many thousands of dollars the state will spend chasing hundreds of dollars in unreported taxes........
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I forgot to mention that NE will be collecting past history from Amazon and other Internet sales outlets and matching up reported internet sales with actual Internet sales.
For the sake of my curiosity, what legal right gives Nebraska the ability to collect past history regarding sales from companies not in this state?
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I wonder how many thousands of dollars the state will spend chasing hundreds of dollars in unreported taxes........
Depending on how much people have bought on line from vendors who didn't charge sales tax to out-of-state customers, it could be substantial. I know of people who do all their Christmas shopping on line. The gifts are shipped directly to the recipients. All the buyer sees is a line in his next credit card statement.
I don't understand why Amazon, or any other on line vendor, would do this voluntarily. It puts them at a competitive disadvantage compared to their competition. Usually, there is a trade off between sales tax and shipping. If you have to pay both, there is no longer a reason to buy on line unless the item is unavailable within the state. Most of what Amazon sells can be bought locally although it may take a special order. Reporting sales history so that the state can collect back taxes will alienate loyal customers.
I wonder how much of this is driven by the state's (insatiable) hunger for tax receipts and how much is driven by pressure from in state, brick and mortar vendors who are having a hard time competing with a more efficient business model. Will Nebraska require Nebraska-based on line vendors to charge sales tax on shipments to other states? I'll bet not.
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I forgot to mention that NE will be collecting past history from Amazon and other Internet sales outlets and matching up reported internet sales with actual Internet sales. If you haven't been reporting Internet sales taxes expect a letter from the Dept of Revenue sometime in the future. They'll probably offer an amnesty period. After that the penalties for under reporting will be significant. I wrote the code for comparing incomes reported on the fed form with that on NE's form. Several thousand cheaters were found and prosecuted.
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Hmmm, doesn't sound legit, retroactive? Do you have a link to that? Court challenge imminent? And would it not require an audit of your taxes? Looks like the state needs to hire more staff. Like a dollar waiting on a dime. Lol
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Depending on how much people have bought on line from vendors who didn't charge sales tax to out-of-state customers, it could be substantial. I know of people who do all their Christmas shopping on line. The gifts are shipped directly to the recipients. All the buyer sees is a line in his next credit card statement.
I don't understand why Amazon, or any other on line vendor, would do this voluntarily. It puts them at a competitive disadvantage compared to their competition. Usually, there is a trade off between sales tax and shipping. If you have to pay both, there is no longer a reason to buy on line unless the item is unavailable within the state. Most of what Amazon sells can be bought locally although it may take a special order. Reporting sales history so that the state can collect back taxes will alienate loyal customers.
I wonder how much of this is driven by the state's (insatiable) hunger for tax receipts and how much is driven by pressure from in state, brick and mortar vendors who are having a hard time competing with a more efficient business model. Will Nebraska require Nebraska-based on line vendors to charge sales tax on shipments to other states? I'll bet not.
There is already an "online sales tax" however at this point it only affects the top dogs in the online shopping world, such as Amazon, and as such, its not exactly voluntary for Amazon to begin collecting sales tax, and , yes, any Nebraska based company that meets the threshold will be collecting sales tax for stuff shipped out of state.
The other part about sales history sounds somewhat dubious to me........
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There is already an "online sales tax" however at this point it only affects the top dogs in the online shopping world, such as Amazon, and as such, its not exactly voluntary for Amazon to begin collecting sales tax, and , yes, any Nebraska based company that meets the threshold will be collecting sales tax for stuff shipped out of state.
That's not what the Small Business Administration web site says about internet sales tax. A mail order company is required to charge sales tax only if it has a physical presence in the same state as the shipping destination. Presence can be a headquarters, office, store front, sales rep or warehouse. A third party seller, which Amazon uses extensively, can also constitute a presence. No presence means that sales tax is between the buyer and his state of residence.
According to another site, federal legislation to require collection and distribution of sales tax has been under consideration for several years. That sounds like the "online sales tax" you mentioned. However, according to the site, nothing has been passed. As you said, it would only apply to mail order businesses with annual sales greater than $1,000,000. That's not a very high threshold in today's world. A small business with a warehouse and half a dozen employees would need that much just to break even.
ebay is another internet giant. However, since they are an auction house rather than a seller, I doubt that federal legislation would affect them. Ditto for GunBroker and Armslist.
According to WOWT, the Nebraska Tax Commissioner stated that Amazon is "exhibiting responsible corporate citizenship." That sounds more like the companies that used to twist employees' arms about donating to United Way than a legal mandate.
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I forgot to mention that NE will be collecting past history from Amazon and other Internet sales outlets and matching up reported internet sales with actual Internet sales. If you haven't been reporting Internet sales taxes expect a letter from the Dept of Revenue sometime in the future. They'll probably offer an amnesty period. After that the penalties for under reporting will be significant. I wrote the code for comparing incomes reported on the fed form with that on NE's form. Several thousand cheaters were found and prosecuted.
Hmmm..... Who's side are you on? :o
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One the side of Law, order and ethics. How about you?
The largest difference between state and fed reported gross income was $100,000. It took me a couple hours to write and test the SQL scripts which did the comparison, so it wasn't a case of "thousands of dollars chasing hundreds of dollars", as someone with little knowledge of the subject implied.
The difference threshold could be any amount. My first run using $250 found over 10,000 thousand returns. Using $1,000 found over 1,000 returns, IIRC, and they were sent letters. Using $10,000 found over a hundred, which included the $100,000 cheater. No one makes an accidental $100,000 mistake.
Currently the NE tax collections are down $700 MILLION and the Dept is under staffed and over worked. They can't afford to pay new hires the current salary businesses pay so hiring quality programmers is hard. Keeping them is equally hard.
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One the side of Law, order and ethics. How about you?
The largest difference between state and fed reported gross income was $100,000.
What does that have to do with sales tax, I wonder?
The difference threshold could be any amount. My first run using $250 found over 10,000 thousand returns. Using $1,000 found over 1,000 returns, IIRC, and they were sent letters. Using $10,000 found over a hundred, which included the $100,000 cheater. No one makes an accidental $100,000 mistake.
So....what does this have to do with sales tax? People reporting different amounts of gross incomes on different tax forms is a completely different topic.
Currently the NE tax collections are down $700 MILLION and the Dept is under staffed and over worked. They can't afford to pay new hires the current salary businesses pay so hiring quality programmers is hard. Keeping them is equally hard.
Okay.
So...what does that have to do with sales tax?
And to reiterate my earlier question: What legal right gives Nebraska the ability to collect past history regarding sales from companies not in this state?
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One the side of Law, order and ethics. How about you?
The largest difference between state and fed reported gross income was $100,000. It took me a couple hours to write and test the SQL scripts which did the comparison, so it wasn't a case of "thousands of dollars chasing hundreds of dollars", as someone with little knowledge of the subject implied.
The difference threshold could be any amount. My first run using $250 found over 10,000 thousand returns. Using $1,000 found over 1,000 returns, IIRC, and they were sent letters. Using $10,000 found over a hundred, which included the $100,000 cheater. No one makes an accidental $100,000 mistake.
Currently the NE tax collections are down $700 MILLION and the Dept is under staffed and over worked. They can't afford to pay new hires the current salary businesses pay so hiring quality programmers is hard. Keeping them is equally hard.
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No offense to your situation but what I was implying was government entities aren't typically ran efficiently. And as a business owner I have had experience dealing with the Department of Revenue and had a friend that was a programmer at the Department of banking.
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so.... taxation isn't theft?
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One the side of Law, order and ethics. How about you?
The largest difference between state and fed reported gross income was $100,000. It took me a couple hours to write and test the SQL scripts which did the comparison, so it wasn't a case of "thousands of dollars chasing hundreds of dollars", as someone with little knowledge of the subject implied.
The difference threshold could be any amount. My first run using $250 found over 10,000 thousand returns. Using $1,000 found over 1,000 returns, IIRC, and they were sent letters. Using $10,000 found over a hundred, which included the $100,000 cheater. No one makes an accidental $100,000 mistake.
Currently the NE tax collections are down $700 MILLION and the Dept is under staffed and over worked. They can't afford to pay new hires the current salary businesses pay so hiring quality programmers is hard. Keeping them is equally hard.
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So in theory, what would be cost effective to pursue?? 1,000?? 10,000??? 500??
Still spending thousands to chase hundreds.
I understand that there are hundreds of thousands, perhaps even millions of use tax dollars unreported, I also understand that the dollars are spread out over hundreds of thousands of tax payers, and it costs money to find those tax returns, it costs money to audit those returns, and it will cost thousands to pursue legal action against said tax payers.
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so.... taxation isn't theft?
Taxation is ABSOLUTELY theft!
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Taxation is ABSOLUTELY theft!
did you miss my sarcasm?
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No offense to your situation but what I was implying was government entities aren't typically ran efficiently. And as a business owner I have had experience dealing with the Department of Revenue and had a friend that was a programmer at the Department of banking.
Contrary to popular opinion state employees cannot make up rules on the fly as they do their jobs. They are legally bound to follow the letter of the laws when dealing with the public. You know that from dealings with the rules for obtaining a CHP.
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Taxation is ABSOLUTELY theft!
Only without representation. You get what you vote for, if who you vote for is honest.
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if who you vote for is honest.
When does that ever happen ? :o ;D :P :laugh:
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When does that ever happen ? :o ;D :P :laugh:
It happens more often if good people get out and support good candidates. I can give a few examples at the local level that it happens, I also know the NFOA supported some good candidates at the State level that got in, and I believe General Bacon who is a Congressman-Elect for Nebraska is a good example. So it does happen if we get involved.
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Contrary to popular opinion state employees cannot make up rules on the fly as they do their jobs. They are legally bound to follow the letter of the laws when dealing with the public.
Somebody forgot to tell that to the state employees who undercalculated prison sentences.
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Amazon is worried about getting sued because they're a fulfillment and 3rd party sales service rather than a traditional business who owns most of their own inventory. If I'm sitting in Nebraska selling Beanie Babies that I'm drop-shipping from AliExpress in China, and someone in South Dakota is selling the same Beanie Babies, also on Amazon, and someone in Nebraska buys one of said Beanie Babies from Amazon, the NE Attorney General is inclined to say Amazon has a "presence" in the state (me) and should be withholding taxes, even if the merchant who fulfills the order is in South Dakota. These lawsuits were brewing in several states already so Amazon just took the proactive step to implement it before the lawsuits came to fruition because it was cheaper than waiting for the suits, since the costs will be borne by the merchants and not by Amazon. Amazon is not a "good corporate citizen", they are just looking out for their own bottom line.
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Somebody forgot to tell that to the state employees who undercalculated prison sentences.
From what I read they were trying to implement the legislature's desire to reduce prison populations and misinterpreted the regs.
By the way, I heard from a good source this evening that the NE budget deficit has risen to over $1 BILLION! No longer at $700M. It may go even higher. That's about $500 for every man, woman and child in the state. Even newly arrived Muslim refugees are qualifying for $700/mo SSI (which is federal but NE gets back less than half of of every dollar it sends to the Feds)
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So... seems it isn't just Amazon... while starting my taxes with TurboTax I come across this section ---
Nebraska use tax is a tax paid while in Nebraska on purchases of items or services outside Nebraska for use in Nebraska. The Nebraska use tax is 5.5% (.055) plus any applicable local rate.
You owe Nebraska use tax if:
- you did not pay use tax on those items or services that are subject to the tax
- you paid use tax at a lower rate than the required use tax rate for the area where you live
Let us know if you bought something outside Nebraska while in Nebraska without paying a sales tax. You'll need to pay taxes on these items (this is called a use tax) Examples include: Purchases made in another state and brought back into Nebraska
So... If I buy something over in Iowa and bring it back into Nebraska, then I have to track those purchases and pay a "use tax". For example, at the beginning of school season, Iowa has their "no tax" on school supplies days... well... not if you live in the "Tax-ME-State" ... >:D :o
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What about purchases made in another state and delivered to a 3rd state? Or maybe I was not In Lincoln when I bought that last minute birthday gift.
For instance I bought an Amazon gift for my Mother in Arizona while visiting my daughter in Denver...still shows up on my Amazon order history in my account. Are they going to geolocate all my purchases?
BTW you can request an order history report at this link
https://www.amazon.com/gp/b2b/reports
ETA I believe gift cards are exempt from sales tax and they are in the report too
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ETA I believe gift cards are exempt from sales tax and they are in the report too
as long as the state does not try to dubble dip the taxes . once when you buy a card then and tax again to use them. not saying they won't try lol ... but they won't get away with it
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BTW you can request an order history report at this link
https://www.amazon.com/gp/b2b/reports
ETA I believe gift cards are exempt from sales tax and they are in the report too
Interesting report. One problem I see is that when you return something for credit, the report does not show that. If NE is going to collect for back taxes, they may try and collect for an item that you returned.
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Interesting report. One problem I see is that when you return something for credit, the report does not show that. If NE is going to collect for back taxes, they may try and collect for an item that you returned.
Another interesting note... Amazon only taxed items they fulfilled on an order today of a Blu Ray player and an HDMI cable ( taxed the $6 cable but not the $60 item) I will monitor how that is reported. I would like the Amazon report to be accurate enough to rely on for tax filing purposes
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Amazon also has developed software that figures internet sales tax from any location. They will be happy to let any business use it... for a fee every time it is used.
That also explains why they are not opposed to taxing internet sales.
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More light reading on Amazon sales tax policies
https://www.amazon.com/gp/help/customer/display.html/ref=hp_bc_nav?ie=UTF8&nodeId=202029700
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so.... taxation isn't theft?
Of course not, silly! The government has a metaphysical right to take a little somethin-somethin' for each transaction between two entities so that wonderful government programs have can funded and very useful members of the bureaucracy can be paid.