A.G. Kalman wrote:
- quote -

To assume that practices of the California Republic are
followed by all the other states is a very big assumption.

--
Frederick E. Jorden http://Tax-Accounting-Payroll.com
7825 Midlothian Tpk - 207 Richmond, VA 23235-5247
EMAIL knowtax[at]bigfoot.com
(804) 320-6210 FAX (804) 320-6211

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A.G. Kalman wrote:

- quote -

My interpretation of the "separately stated" rule would add
a few words and read something as follows:

"If the amount of sales tax is separately stated AS REQUIRED
OR PERMITTED BY APPLICABLE STATE LAW and..."

In other words, if state law doesn't require or permit the
separate statement of the tax, then I think it is still a
"no-go."

For example, what if rather than billing a client "$400 for
service rendered," I billed "$399.82 for services rendered,
plus $.18 for sales tax paid on paper and staples," would
the client be entitled to claim a sales tax deduction for
that $.18 cents? I think not, since the billing methodology
does not meet the requirements of applicable state law, even
though the tax appears to be "separately stated." (Tax
preparation service are NOT subject to sales tax in my
state.)

On the gas tax question, if state law REQUIRES the
CONSPICUOUS posting of the tax breakdown, then I would
probably agree with you on that point.

MTW

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Harlan Lunsford wrote:
- quote -

The IRS just published some guidance in Notice 2005-31 on
deducting sales taxes. Here's the text on what it says about
the tax being separately stated and paid by the consumer:

"If the amount of a sales tax is separately stated and paid
by the consumer (other than in connection with a trade or
business), the amount of the tax is treated as a tax imposed
on and paid by the consumer rather than the seller.
Therefore, the consumer may deduct sales taxes that are
imposed on the seller if the tax is separately stated (as on
a contract or receipt) and paid by the consumer. Section
164(b)(5)(G)."

Here in CA and I assume the other states that tax gasoline,
the sales tax is buried in the price per gallon. It is
usually posted at or near the pump. The sign usually shows
the federal fuel tax, state fuel tax and sales tax per
gallon. The actual paper receipt only shows the price per
gallon. I think it is reasonable to include as a deduction,
the sales tax paid on the fuel if the sales tax is
separately identified to the public at the gas station.

--
Alan
http://taxtopics.net

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Harlan Lunsford wrote:
- quote -

My source is:
http://www.georgiagasprices.com/tax_info.aspx

--
Alan
http://taxtopics.net

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A.G. Kalman wrote:
- quote -

Is that "GA" as in "Georgia, Alan? If so, I was never aware
of this, and I am FROM Georgia. Of course I've never had
any service station clients either.

What about it Paul (Thomas); is this so?

ChEAr$,
Harlan Lunsford, EA n LA
Wed 9 Mar 2005

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Harlan Lunsford wrote:
- quote -

Here are the states I am aware of:
CA, GA, HI, IN, MI, NY & WV

--
Alan
http://taxtopics.net

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Harlan Lunsford wrote:
- quote -

In Virginia the dealer pays a sales tax on the non-road tax
part of the gas purchase cost. But it is not added to the
selling price. The "profit margin" covers it. I doubt the
sales tax is not claim able by the purchaser. But, maybe
someone in the Mars family will try.

--
Frederick E. Jorden http://Tax-Accounting-Payroll.com
7825 Midlothian Tpk - 207 Richmond, VA 23235-5247
EMAIL knowtax[at]bigfoot.com
(804) 320-6210 FAX (804) 320-6211

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"DSF" <df190765[at]hotmail.com> wrote:

- quote -

Well for one thing, in most states gasoline isn't subject to
sales tax, its subject to a fuels tax which is not the same
thing.

--
David M. Woods, EA, ChFC, CLU
Woods Financial Services
Norwood, MA 02062
www.woods-financial.com

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DSF wrote:

- quote -

Here's a simple reason why nobody's talked about gas
receipts. Gasoline is not subject to sales tax in any state
that I know of.

Does anybody know of any state that does sales tax gasoline?

ChEAr$,
Harlan Lunsford, EA n LA

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DSF wrote:

- quote -

When it comes to buying fuel, you have to separate all the fuel
taxes (federal, state & local) from the equation. Then you have
to confirm that fuel purchases are subject to sales tax. If they
are subject to sales tax, then the sales tax is typically applied
to the total cost per gallon including the fuel taxes. I believe
it would be reasonable to derive the sales tax paid if you have
the original receipt showing the amount bought and paid. E.g.,
if tax rate is 6% and fuel bill is $30.00 the tax paid is $30
minus $30/1.06.

--
Alan
http://taxtopics.net

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DSF wrote:

- quote -

Gas tax isn't sales tax, though. At least not in my state.

Phoebe

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"DSF"
<df190765[at]hotmail.com> wrote:

- quote -

Gas tax isn't deductible, because it's an excise, not a
general sales, tax.

--
Tom Healy, CPA
Boulder, CO
Web: http://www.tomhealycpa.com

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"DSF" <df190765[at]hotmail.com> wrote:

- quote -

Most of that is not general sales tax, it's product specific
excise tax, which is not deductible.

--
Phil Marti
Clarksburg, MD

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DSF wrote:

- quote -

Not all of that is "sales tax". However, at least in
California, some of it is. I suppose this is a minor
recalculation for those who use the "actual" method of auto
expenses.

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Something else to add to that issue is gas receipts. I have
not seen any gas receipts that show how much tax was paid.
In Tennessee where I live 21.4 cents per gallon is tax. The
tax is then split three ways with some going to TDOT (TN
Dept Of Trans.) and the rest going to state and local.

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Cranky One wrote:

- quote -

You'll need a complete receipt showing the tax separtely
when/if you get audited. And when/if you do, the auditor
will not accept that total. Or at least shouldn't.

ChEAr$,
Harlan Lunsford, EA n LA

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"Cranky One" <not_me[at]nowhere.com> wrote

- quote -

I think the Regs say you need receipts that ~show~ the sales
tax paid.

- quote -

Then you can't prove you paid any sales tax.

- quote -

Again, it's going to be hard to prove the tax was paid if
the receipt doesn't indicate any tax.

--
Paul A. Thomas, CPA
Athens, Georgia
taxman at negia.net

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Cranky One wrote:

- quote -

If you want to use the "actual receipt" method, you have to
a receipt that shows the amount of sales tax paid.

--
Alan
http://taxtopics.net

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Cranky One wrote:

- quote -

You need receipts with the tax itemized. Otherwise you
should use the sales tax tables.

- quote -

You need receipts with the tax itemized. Otherwise you
should use the sales tax tables.

Note that if the tax was not itemized on the contractor's
original invoice, then chances are you are not entitled to
deduct it (because the contractor, not you, is deemed to be
the "taxpayer" of the sales tax in that case).

MTW

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1. Do I need to have the actual receipt showing the sales
tax deduction or can I substitute a check or charge card
bill showing the store/location and the amount?

2. What if the receipt doesn't show sales tax ? I had a
home improvement project and the receipt only shows the
total cost.

Thaks for the help !

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