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Taxes

KMSEXC

Well-Known Member
Joined
Nov 18, 2007
Messages
97
Location
ct
This is question for company owners , In Excavating how do you charge your customers taxes, do add it on the end of the bill , sounds stupid I know But need the help, Thanks KMS
 

JDecker

Well-Known Member
Joined
Mar 14, 2008
Messages
48
Location
NY
when we buy material we always pay the tax inless it's a tax exempt job. and just charge the custmor for the material and mark material up when you can. Alot less paper work. You don't need to charge tax when you are working with your equipment because it's a service. Hope that help:usas
 

tuney443

Senior Member
Joined
Mar 19, 2006
Messages
1,216
Location
Dutchess County,NY
Occupation
excavating contractor
This is question for company owners , In Excavating how do you charge your customers taxes, do add it on the end of the bill , sounds stupid I know But need the help, Thanks KMS

Many excavators,masons,plumbers,etc. don't get sales tax. If it's a repair,it most definitely is taxable,a product such as fill,topsoil is taxable.If the job is for new construction{I'm going here by NY laws},if the client fills out a capital improvement form,it will then be tax-exempt.The onus is on the client if the form was completed correctly if you should get audited.Other tax-exempt forms I use are resale certificates and school,religious,not-for-profit,gov't exempt type forms.Sales tax always gets calculated at the end of the bill,just like any other bill.
 

tuney443

Senior Member
Joined
Mar 19, 2006
Messages
1,216
Location
Dutchess County,NY
Occupation
excavating contractor
when we buy material we always pay the tax inless it's a tax exempt job. and just charge the custmor for the material and mark material up when you can. Alot less paper work. You don't need to charge tax when you are working with your equipment because it's a service. Hope that help:usas

You're completely wrong---any service is taxable---it's only not if the service you are doing meets ALL the criteria on the Capital Improvement form or some other tax-exempt form because basically you are doing new construction of some sort.Try telling a sales tax agent in Albany that services aren't taxable---he will ask for directions to your office faster than you can say Oh S***!!!
 

JDecker

Well-Known Member
Joined
Mar 14, 2008
Messages
48
Location
NY
You're completely wrong---any service is taxable---it's only not if the service you are doing meets ALL the criteria on the Capital Improvement form or some other tax-exempt form because basically you are doing new construction of some sort.Try telling a sales tax agent in Albany that services aren't taxable---he will ask for directions to your office faster than you can say Oh S***!!!


Sorry i guess i should have said that a little different you are absolutely right you do need to have a capital improvement form in order not to charge sale tax. Which like you said most off the time you are doing new consruction i should not have said service.:pointhead
 

KMSEXC

Well-Known Member
Joined
Nov 18, 2007
Messages
97
Location
ct
Thanks

Sorry i guess i should have said that a little different you are absolutely right you do need to have a capital improvement form in order not to charge sale tax. Which like you said most off the time you are doing new consruction i should not have said service.:pointhead

Thank you fellows i Aways get good advice here Thanks Again KMSEXC
 

KMSEXC

Well-Known Member
Joined
Nov 18, 2007
Messages
97
Location
ct
You're completely wrong---any service is taxable---it's only not if the service you are doing meets ALL the criteria on the Capital Improvement form or some other tax-exempt form because basically you are doing new construction of some sort.Try telling a sales tax agent in Albany that services aren't taxable---he will ask for directions to your office faster than you can say Oh S***!!!

So new home construction is not taxable and and existing homeowner work is taxable, what do you charge tax on the final cost of job So a Builder calls me and says I need a cellar dug for a new home I know i don't charge tax on that project just pay IRS on profit , A Home owner calls says they need a waterline installed or septic system I quote them a price and Then add Tax On it Does that sounds Right
 
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JDOFMEMI

Senior Member
Joined
Jan 3, 2007
Messages
3,074
Location
SoCal
Reember, Each state has its own tax laws. Just because its that way in NY, where the answers are from, does not mean the same applies in CT, where you seem to be.

Just a heads up. I would do some more research. If you are doing taxable work, I think it should go right on the invoice.
 

Willis Bushogin

Senior Member
Joined
Nov 6, 2007
Messages
855
Location
NC
Occupation
owner
This is question for company owners , In Excavating how do you charge your customers taxes, do add it on the end of the bill , sounds stupid I know But need the help, Thanks KMS

I think I understand your question, as a owner, if I showed I added taxes, on work performed and tax on supplies, I would lose about half of my customers. They dont like to pay tax on anything (who does) so I just show everthing as a total
excavator work-$2800.00
dozer work- $1200.00
supplies- $856.97

Im not saying, dont charge taxes, just dont show it. In my state you dont have to charge taxes on machine work.
Just my 2 cents worth
 

cat320

Charter Member
Joined
Nov 6, 2003
Messages
913
Location
Stoneham,MA
Doese every one normaly charge tax on labor? I mean if you buy pipe stone building supplies and mark them up then your charge tax on them .home owner,builder buys them but you install no taxes.
 

Steve Frazier

Founder
Staff member
Joined
Oct 30, 2003
Messages
6,599
Location
LaGrangeville, N.Y.
One thing everyone needs to do here is get their terminology correct. You, the contractor do not charge sales tax, the State does. You are simply acting as a collections agent for the State as required by law. State laws vary, so not all answers seen here will apply to everyone.

cat320, in NY the answer to your question if I'm understanding it is yes, you must collect tax on labor unless the job is a capital improvement.
 

ASPHALT04

Well-Known Member
Joined
Mar 9, 2008
Messages
137
Location
Wisconsin
Occupation
Owner / Doing whatever it takes to pay the bills!
I agree with Steve on thid one because I have lived in a few different states. What works in one state will not work in another. Here where I live certain items are taxable while others are not.
As painful or boring as it might be it would definately be worth the time to sit down a learn the basics. It will possibily save you down the road from a mess!:Banghead
 

KMSEXC

Well-Known Member
Joined
Nov 18, 2007
Messages
97
Location
ct
well Im glad I asked this question, I think this will help a lot of us, keepem coming still not clear on this topic KMSEXC
 

KMSEXC

Well-Known Member
Joined
Nov 18, 2007
Messages
97
Location
ct
I agree

I think I understand your question, as a owner, if I showed I added taxes, on work performed and tax on supplies, I would lose about half of my customers. They dont like to pay tax on anything (who does) so I just show everthing as a total
excavator work-$2800.00
dozer work- $1200.00
supplies- $856.97

I'm not saying, dint charge taxes, just don't show it. In my state you don't have to charge taxes on machine work.
Just my 2 cents worth

Thats Part of it, I like your Idea But If you don't charge taxes on machine work how do you pay your taxes, out of your profit, Man its tough enough out there with the cost of equipment fuel labor materials, I think we have to charge tax on our job profits if you don't charge for it you lose money Thanks for reply
 

tuney443

Senior Member
Joined
Mar 19, 2006
Messages
1,216
Location
Dutchess County,NY
Occupation
excavating contractor
One thing everyone needs to do here is get their terminology correct. You, the contractor do not charge sales tax, the State does. You are simply acting as a collections agent for the State as required by law. State laws vary, so not all answers seen here will apply to everyone.

cat320, in NY the answer to your question if I'm understanding it is yes, you must collect tax on labor unless the job is a capital improvement.

Very good response Steve and just a little extra now,very surprisingly NY has just raised the amount us ''vendors'' are allowed under the ''vendor collection credit''. As an example,2 weeks ago when I filed the Dec.'07--Feb.'08 sales tax quarter,I helped make NY about $1,800 richer,to which I was able to keep app.$80 for my 2 hours worth of work.Not to shabby for a gov't. worker huh?:D
 

KMSEXC

Well-Known Member
Joined
Nov 18, 2007
Messages
97
Location
ct
I Here You on that one

I agree with Steve on thid one because I have lived in a few different states. What works in one state will not work in another. Here where I live certain items are taxable while others are not.
As painful or boring as it might be it would definately be worth the time to sit down a learn the basics. It will possibily save you down the road from a mess!:Banghead

You right a big mess
 

tuney443

Senior Member
Joined
Mar 19, 2006
Messages
1,216
Location
Dutchess County,NY
Occupation
excavating contractor
So new home construction is not taxable and and existing homeowner work is taxable, what do you charge tax on the final cost of job So a Builder calls me and says I need a cellar dug for a new home I know i don't charge tax on that project just pay IRS on profit , A Home owner calls says they need a waterline installed or septic system I quote them a price and Then add Tax On it Does that sounds Right

So again,basically a repair is taxable,but new construction is not,BUT ONLY if you have a properly filled out Capital Improvement form.That basement for the builder or the water/septic for Joe Homeowner needs that cert. if you don't want to charge them tax.Again now,I'm in NY--I'm reciting NY law--yours might be different.Just remember,a builder does not enjoy any special privileges--if he doesn't want to pay sales tax he needs to prove to the state why he is exempt.Your job as the vendor is to make sure that happens--you are acting as an agent for the state.Also remember,the state will most definitely take your money if you should erroneously charge someone sales tax--they will NOT point out to you that you did not have to charge that client the tax.
 

KMSEXC

Well-Known Member
Joined
Nov 18, 2007
Messages
97
Location
ct
So again,basically a repair is taxable,but new construction is not,BUT ONLY if you have a properly filled out Capital Improvement form.That basement for the builder or the water/septic for Joe Homeowner needs that cert. if you don't want to charge them tax.Again now,I'm in NY--I'm reciting NY law--yours might be different.Just remember,a builder does not enjoy any special privileges--if he doesn't want to pay sales tax he needs to prove to the state why he is exempt.Your job as the vendor is to make sure that happens--you are acting as an agent for the state.Also remember,the state will most definitely take your money if you should erroneously charge someone sales tax--they will NOT point out to you that you did not have to charge that client the tax.

ya i will have to check into my state rules , So if the builder hands me an exempt form, I get paid from him Theres no taxes relayed to irs
 

KMSEXC

Well-Known Member
Joined
Nov 18, 2007
Messages
97
Location
ct
Taxe

So again,basically a repair is taxable,but new construction is not,BUT ONLY if you have a properly filled out Capital Improvement form.That basement for the builder or the water/septic for Joe Homeowner needs that cert. if you don't want to charge them tax.Again now,I'm in NY--I'm reciting NY law--yours might be different.Just remember,a builder does not enjoy any special privileges--if he doesn't want to pay sales tax he needs to prove to the state why he is exempt.Your job as the vendor is to make sure that happens--you are acting as an agent for the state.Also remember,the state will most definitely take your money if you should erroneously charge someone sales tax--they will NOT point out to you that you did not have to charge that client the tax.

Im not crazy about it, but I just have visit the IRS and get a lesson on charging tax and paying tax
 
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