Tennessee - Email from Amazon about Tax

[md21722]

TN regularly watches for out of state furniture purchases. NC is usually where they come up with people trying to skirt the tax.

If you've ever looked at NC's income tax forms, they charge you an extra 0.1% income tax because they assume you purchased things out of state. The alternative is to submit all your receipts!

[bkjonesborough]

Originally Posted by LauraC

It says this in the Amazon letter: "The total sales price of purchases you had shipped to Tennessee in 2011 was $XXXX." Am I to think if you purchased items to be sent to someone in another state, by Amazon, it's not taxed? If that's true and you are buying gifts for people in another state, don't have Amazon ship them to you, have them shipped directly to the intended recipient.

That is correct. You only have to pay Sales Tax on items that were initially taken possession of in TN. I have an online store. I am in TN, so if I sell to TN residents, I collect sales tax based on the delivery to a TN address. Example: My next door neighbor can buy something from me, but if she pays me to have it shipped directly to her sister in Iowa without taking possession of it in this state, then she does not have to pay sales tax. If she buys it and ships it herself, then she has to pay the sales tax because she took possession of it. (I think there are loopholes for that, such as taking it out of state herself in x amount of time, but can't remember how that goes.)


Something I'd like to add to others reading this thread for the first time- this is not new. It's always been everybody's 'responsibility' to go to the Dept of Revenue in their own state and pay taxes on anything bought from another state. It's just not been traceable, hardly anybody knows about it, and it's not actively enforced.

[An Einnseanair]

The only change from the recent law (to go into effect in 2014 as mentioned earlier) is that Amazon will start collecting tax at the point of purchase. You ALWAYS owed the "use tax", equal in amount to the sales tax, whenever you bought something out of state and brought it in state. You could get an exemption for any sales tax you paid in the other state, though. So if you live in Chattanooga and buy several rolls of carpet in GA and pay 6% GA sales tax, you owe 9.25%-6% = 2.25% when you get home.

If you order from Amazon in 2014 they will automatically add TN state sales tax. If you try to cheat and and have the item shipped to your friend just over the line in GA, you still legally owe the tax when he brings it over the state line and gives it to you. It's all a matter of enforcement.

Some people avoid taxes by hiding money in the Caymans, some people do it by other means. It's all illegal and the honest folks have to pay for your theft.

[southernsmoke]

Originally Posted by jwkilgore

Some people avoid taxes by hiding money in the Caymans, some people do it by other means. It's all illegal and the honest folks have to pay for your theft.

What's illegal about having money/property in another country?

[An Einnseanair]

Originally Posted by southernsmoke

What's illegal about having money/property in another country?

Nothing is "illegal about having money/property in another country". It's when you legally owe taxes on income or some other source of money and hide this fact by hiding the money in a place where the IRS can't look. Some people hide money oversees so the IRS can't see it.... other people buy stuff online to hide from state tax agencies to avoid paying sales tax... other people hide store merchandise in their underwear so the store clerk can't see it.

Same thing, different scale.