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 State Sales Tax Exempt

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samo

  • Total Posts: 2
  • Joined: 3/30/2006
  • Location: Cincinnati, OH
State Sales Tax Exempt Thu, 03/30/06 12:47 PM (permalink)
Hi,
Hope someone can clear this up for us.

We have a concession stand. We buy most of our supplies at Cosco's and Sams. Everyone tells me I should not have to pay sales tax when I buy my supplies for sale at our concession stand.

Can anyone in the restaurant business tell me what is correct.

We have our Federal ID number, but I have only used it to buy large
restaurnat equipment.

Thanks in advance for your information.
 
#1
    tmiles

    • Total Posts: 1909
    • Joined: 10/1/2004
    • Location: Millbury, MA
    RE: State Sales Tax Exempt Thu, 03/30/06 1:35 PM (permalink)
    It depends on your state. I am not a tax pro, but as I understand it in my state (and I could be wrong, but I have not been fined or arrested), this is the way it goes here. I am not in the food biz but I do run a business. I pay a tax on goods that I CONSUME to run my business. I don't pay a tax on goods that I buy to resell. I COLLECT a tax (on behalf of the state) on goods that I sell. As an example take a roll of paper towels. If I am buying them to use, I pay a tax. If I am buying them to resell, I don't. I don't know about food, because in this state there is no tax on food. BTW, in my state you would owe a tax on that big restaurant equipment. In addition to your federal number (at least in Massachusetts) you need a sales tax ID. In my state the sales tax dept really is there to help you understand the law. You should try yours.
     
    #2
      damon2

      • Total Posts: 47
      • Joined: 3/12/2006
      • Location: Buellton, CA
      RE: State Sales Tax Exempt Thu, 03/30/06 4:00 PM (permalink)
      In California, it's the same as tmiles, I don't pay sales tax on my food items as they are for resale, but on equipment and supplies I do. I would suspect you also need some sort of resellers permit / state tax ID. You need to check with whatever your state agency is, as in some states all food sales are taed, whereas in others take out food is not...and you may fall into that catergory being a concession stand.

      Hope it helps a bit
       
      #3
        dogmeat

        RE: State Sales Tax Exempt Thu, 03/30/06 5:29 PM (permalink)
        Check this out - talk about confusing!!!
        (http://tax.ohio.gov/divisions/sales_and_use/documents/streamlined_sales_tax_food_BR.pdf)

        Good Luck!!!
         
        #4
          1bbqboy

          • Total Posts: 4542
          • Joined: 11/20/2000
          • Location: Rogue Valley
          RE: State Sales Tax Exempt Thu, 03/30/06 6:13 PM (permalink)
          No Sales Tax in Oregon.
           
          #5
            UncleVic

            • Total Posts: 6025
            • Joined: 10/14/2003
            • Location: West Palm Beach, FL
            • Roadfood Insider
            RE: State Sales Tax Exempt Fri, 03/31/06 12:43 AM (permalink)
            In Michigan, your tax exempt buying the food inventory. BUT, selling prepared foods is taxable.. Packaged food like chips are non taxable. Hot Dogs-taxed (when they are cooked and served).
             
            #6
              tmiles

              • Total Posts: 1909
              • Joined: 10/1/2004
              • Location: Millbury, MA
              RE: State Sales Tax Exempt Fri, 03/31/06 9:49 AM (permalink)
              In my earlier post I said that there was no tax on food in Massachusetts. I need to say more. When you buy food at the store, it is not taxed. When you buy prepared food, even takeout, you pay a meals tax, which is different from our sales tax. You need to have a tax number to sell prepared food, because you need the system to collect and remit the tax. Unremitted meals tax is often the cause of restaurant shutdowns here, because one can borrow from Peter to pay Paul just so long. The state will try to work out a repayment plan. but the situation is often too bad to bother.
               
              #7
                dinerminer

                • Total Posts: 16
                • Joined: 2/17/2006
                • Location: Manhattan, KS
                RE: State Sales Tax Exempt Fri, 03/31/06 12:02 PM (permalink)
                Generally, sales tax is an end-user tax, meaning the ultimate consumer pays the tax. Food purchased for retail sale is usually not taxed. Supplies, non-comestibles, are generally taxed. Some states provides tax-exempt #'s as well as tax ID#'s. Consult with your states department of revenue for guidelines in your state.
                 
                #8
                  damon2

                  • Total Posts: 47
                  • Joined: 3/12/2006
                  • Location: Buellton, CA
                  RE: State Sales Tax Exempt Fri, 03/31/06 2:56 PM (permalink)
                  quote:
                  Originally posted by dogmeat

                  Check this out - talk about confusing!!!
                  (http://tax.ohio.gov/divisions/sales_and_use/documents/streamlined_sales_tax_food_BR.pdf)

                  Good Luck!!!


                  ummmmmmmmmmm..they had to list pet food as non-food?
                  thats scary
                   
                  #9
                    Rootsman

                    • Total Posts: 235
                    • Joined: 7/9/2005
                    • Location: Orlando, FL
                    RE: State Sales Tax Exempt Fri, 03/31/06 11:45 PM (permalink)
                    You need to get the sales tax exempt certificate/ID number from your state dept of revenue. This allows you to collect sales tax and get the tax exemption when appropriate. A Federal ID has nothing to do with a sales tax ID.

                    As said earlier, you should pay sales tax on stuff consumed in your business but not stuff for resale. So, disposable utensils, straws, soda, take-out containers, condiments, napkins etc are tax exempt. Disposable food pans you use for large take-out or catering orders are also exempt, where as those you use in your own steam tables are not. You need to supply the store with a copy of your sales tax certificate each year.
                     
                    #10
                      bassrocker4u2

                      • Total Posts: 534
                      • Joined: 11/12/2003
                      • Location: new holland, PA
                      RE: State Sales Tax Exempt Sat, 04/1/06 8:39 AM (permalink)
                      here in ga, you need your tax id number at sams to be tax exempt from purchases. although its only for taxable re-sell items. food items are not taxed, unless they are prepared, like the cakes and pies, and such. hmm.. wonder why that is...
                      if i buy a chocolate cake that sams makes in their bakery, i get taxed.
                      if i buy a frozen chocolate cake, no tax.
                      but definitely i would have to pay tax on the equipment purchases. unless i am reselling my ovens and fryers....
                       
                      #11
                        dreamzpainter

                        • Total Posts: 1609
                        • Joined: 2/6/2005
                        • Location: jacksonville, FL
                        RE: State Sales Tax Exempt Sat, 04/1/06 12:58 PM (permalink)
                        I can't speak expressly to restaurants but in NJ and Fl an auto repair shop pays taxes on consumables/supplies but not on parts etc that will be sold to a customer. So your pot is taxed but the hotdogs shoudln't be. Look into Sam's commercial account
                         
                        #12
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