janegall[at]plasticproductsco.com (Jane) wrote:

- quote -

Do you not require employees to submit the original
documentation for their company credit card purchases?
Generally that will show whether sales tax was paid. I'd
just insist that employees turn in their original receipts.
That way, also, you may be able to tell whether they are
purchasing items for their own use on the company credit
card <G> .

In order to buy tangible personal property without paying
sales tax, generally the purchaser has to give the vendor a
valid resale certificate. Do your employees often buy items
for resale on their credit cards? Do they buy items (for
consumption, not resale) from vendors with which your
company has a blanket resale certificate on file? In that
case, the vendor might not charge sales tax, but otherwise,
it doesn't seem there would be much risk of underpayment.

Katie in San Diego

The foregoing is intended for educational purposes only and
does not constitute legal or professional advice.

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Jane wrote:

- quote -

The credit card statements and receipts typically do not
break down price and tax. That's not what they're intended
to do. For your own record keeping, have your employees
insist on an invoice with each purchase which of course will
give you the needed detail.

A credit card receipt by itself is not proof to IRS anyway
of a deductible transaction. It takes both that receipt and
the invoice to show a completed transaction.

Cheer$,
Harlan Lunsford, EA in LA

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"Jane" <janegall[at]plasticproductsco.com> wrote:

- quote -

Seems to me that Job One is to educate the users of the card
to ensure that incorrect sales tax payments/non-payments do
not occur.

Don Rosenberg, EA

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Our company does business in five different states. A
number of our employees make purchases with a Pcard (company
MasterCard). We are a manufacturer of items for re-sale, so
some of our purchases are exempt from state sales tax – and
of course, some are not exempt.

We can't always see whether or not we've paid sales tax on
the MasterCard statements. I'd venture to guess that we are
paying sales tax on some purchases that would be considered
"tax exempt", and then other times we aren't paying sales
tax on "taxable" purchases.

Any suggestions on how to handle this?

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