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post #1 of 24 (permalink) Old 10-13-2005, 03:45 PM Thread Starter
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Any lawyers, tax accountants or someone with a clue here? Got a question

So i start to do an order on this site and as I am checking out I notice $2 and change added on as tax on a roughly $50 order. I know if it was a NY state store it would be around $4.25 tax so I shot them an email inquiring as to why I was charged sales tax from a company that is down in VA?
Ill post the response below but after reading it, it sounds like they are pocketing the money because they are a new company and are making up for lost profit. I know basic law so far and have tax law and other business law classes later on so I dont know the answer myself, but this seems a bit on the illegal side and almost like tax fraud since it appears they are keeping the extra money.

Quote:
Tom,

We had it initially set up like this on the webstore settings, because we are based in VA, and are subsequently charged for VA sales tax.
It was an option given to us to charge the VA tax on all orders, and we thought it would be a prudent move in our fist 6 months. We are looking to change that shortly.

Hope this answers your questions,
what do you guys think?

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post #2 of 24 (permalink) Old 10-13-2005, 03:53 PM
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Re: Any lawyers, tax accountants or someone with a clue here? Got a question

I don't know the specifics, but I recall there being a big fuss here in VA in the last few years about tax not being collected from online purchases. Don't know what came of it, but see the following Washington Post article from July of this year.

http://www.washingtonpost.com/wp-dyn...070101475.html

The article mentions that it would have gone into effect on Oct 1.
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post #3 of 24 (permalink) Old 10-13-2005, 03:55 PM
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Re: Any lawyers, tax accountants or someone with a clue here? Got a question

You are also supposed to calculate and pay any sales tax that you owe but didn't pay in online transactions and report it to your state, regardless of where you live (unless there is a law exempting it).
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post #4 of 24 (permalink) Old 10-13-2005, 03:59 PM Thread Starter
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Re: Any lawyers, tax accountants or someone with a clue here? Got a question

[quote author=murph182 link=topic=31517.msg440398#msg440398 date=1129233225]
I don't know the specifics, but I recall there being a big fuss here in VA in the last few years about tax not being collected from online purchases.* Don't know what came of it, but see the following Washington Post article from July of this year.

http://www.washingtonpost.com/wp-dyn...070101475.html

The article mentions that it would have gone into effect on Oct 1.
[/quote]

According to the article I should be paying my tax rate and not VA rates. It also stated VA hasnt changed their tax laws to allow for this yet. I have purchased many products from a buddy of mine who owns a store in the VA beach area without ever running into this issue. I am looking on the Virginia tax website http://www.tax.virginia.gov and can not find anything pertaining to out of state sales and tax. Personally from the email I recieved from these guys plus the current law I am led to believe that none of the tax money collected from out of state sales will be remitted to the state of VA.

Quote:
n both cases, any taxes the retailer collected would be based on the rates in effect where the buyer lives, and the retailers would be compensated for the cost of collecting and remitting that revenue to the states.

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post #5 of 24 (permalink) Old 10-13-2005, 04:01 PM Thread Starter
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Re: Any lawyers, tax accountants or someone with a clue here? Got a question

[quote author=murph182 link=topic=31517.msg440401#msg440401 date=1129233320]
You are also supposed to calculate and pay any sales tax that you owe but didn't pay in online transactions and report it to your state, regardless of where you live (unless there is a law exempting it).*
[/quote]Of course, but this is a different situation here. I dont trust these guys and I am searching for the law so I can email it back to them and tell them that I might consider doing business with them in 6 months. What is funny is that I wasnt charged tax on the order I placed with them 2 months ago.

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post #6 of 24 (permalink) Old 10-13-2005, 04:05 PM
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Re: Any lawyers, tax accountants or someone with a clue here? Got a question

Quote:
According to the article I should be paying my tax rate and not VA rates. It also stated VA hasnt changed their tax laws to allow for this yet.
perhaps I should read the articles I link to in their entirety

It sounds like either:

A) they're scamming you
or
B) they're just screwed up and don't know what they're doing.

Since you asked for the opinion of lawyers and accountants, I will now bow out since I am neither.
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post #7 of 24 (permalink) Old 10-13-2005, 04:07 PM
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Re: Any lawyers, tax accountants or someone with a clue here? Got a question

my head hurts!


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post #8 of 24 (permalink) Old 10-13-2005, 04:08 PM Thread Starter
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Re: Any lawyers, tax accountants or someone with a clue here? Got a question

I Think its B) they are screwed up. *I like the company and what they are doing on the side, but friend or foe dont separate me from my money unjustly. *I work hard to earn it.

[quote author=murph182 link=topic=31517.msg440411#msg440411 date=1129233927]
Quote:
According to the article I should be paying my tax rate and not VA rates.* It also stated VA hasnt changed their tax laws to allow for this yet.
perhaps I should read the articles I link to in their entirety*

It sounds like either:

A) they're scamming you
or
B) they're just screwed up and don't know what they're doing.

Since you asked for the opinion of lawyers and accountants, I will now bow out since I am neither.
[/quote]

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post #9 of 24 (permalink) Old 10-13-2005, 04:18 PM
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Re: Any lawyers, tax accountants or someone with a clue here? Got a question

They shouldn't charge you tax AT ALL. It must be a mistake, otherwise they can get into some deep shit!!!!!


My opinion, I hate shit like this. If that is a problem, it should be rectified RIGHT AWAY. I would ask them for a refund. Not because you/I need the money, its the principle.


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post #10 of 24 (permalink) Old 10-13-2005, 04:21 PM Thread Starter
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Re: Any lawyers, tax accountants or someone with a clue here? Got a question

[quote author=MoeMan949 link=topic=31517.msg440424#msg440424 date=1129234730]
They shouldn't charge you tax AT ALL. It must be a mistake, otherwise they can get into some deep shit!!!!!


My opinion, I hate shit like this. If that is a problem, it should be rectified RIGHT AWAY. I would ask them for a refund. Not because you/I need the money, its the principle.
[/quote]I stopped the purchase once I saw this tax fee added on AFTER the shipping costs. Their email solidifies the fact that it was done intentionally. I am still looking on the VA Taxation website for a relavent section so I can email it back to them along with a lengthy reply on why they shouldnt be doing this.

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