Paying sales tax on US Coin/Currency sales

I'm aware of the multi-state tax compacts but in that case I would agree with Rim, they are not constitutional

 

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The multi state tax compact was written to facilitate taxation of business entities since these are the taxpayers who are most subject to multi jurisdictional filings. It is a suggested tax framework for states to adopt and write laws within. However, any laws regarding sales and use tax constitutionally have to cover all taxpayers, regardless of situation. Therefor the multi state tax compact suggested rules would also apply to individual taxpayers in the state where they are enacted, not just business entities. This has been adjudicated in the 1940's and 1950's when states tried to have separate programs for businesses versus individuals and found to be unconstitutional. Therefor, even though the compact was written for, designed for, and deals with problems associated with businesses, the adopted laws enacted from it HAS to cover individual taxpayers constitutionally. The only thing states can change is make things not purchased by businesses tax free, or give a threshold for filing high enough that most individuals would not be subject to it, but those same thresholds also apply to business and cannot be retroactive.

 

No, this one is constitutional, it is just who it covers. This is the compact that makes Heritage pay sales tax in California, New York, et al. It has nothing to do with an individual or business without a business in more than one state.

 

Now read Article II, paragraph #3 as I sited in my previous post. Yes, it covers individual. Just not very many of them.

 

Taxpayer" means any corporation, partnership, firm, association, governmental unit or agency or person acting as a business entity in more than one state.

Read more: http://www.cointalk.com/t129255-5/#ixzz0ziobe1X9

I read it and responded in post 62. I was part of the process drawing these rules up, worked as a director of corporate tax in a fortune 100 corporation with offices in all 50 states, and am a CPA. You do not have to agree with what I said, I was just offering my opinion to the thread.

We can disagree and still be friends.

 

Even your post #62 (as I sited in my previous post) states "taxpayers who are most subject to multi jurisdictional filings". Your words, not mine. Buying from eBay or any other out of your state store does not subject you to multi-jurisdictional filings. Mailing or otherwise shipping slaes does not subject you to multi-jurisdictional filings either. Establishing a branch office / business does.

 

Btw, the Compact has nothing to do with why Heritage has to pay any taxes, It is simply a suggested structure of state tax laws that would make it easy for large taxpayers to comply with all jurisdictions. Heritage collects sales tax based upon their nexus, which was legally defined in a 1992 Supreme Court ruling from North Dakota. I can dig up the citation if desired. Nexus is what requires taxpayers to colelct sales tax and be subject to income tax. MTC is simply suggested tax frameworks that an organization drafted and tried to get states to adopt.

 

"taxpayers who are most subject to multi jurisdictional filings" in my post refered to WHY the MTC was drafted. I went on to say any state passing laws under this guidance has to affect ALL taxpayers regardless of business status because of Constitutional concerns. States tried to have different sales/use tax laws for individuals versus businesses but those were struck down 50-60 years ago as unconstitutional.

So, individuals who buy from out of state sellers MUST submit use tax if the state requires it. Do most people? No. But, all states who do have use tax have been cracking down on enforcement, so you are at risk if you are in that position. I do not have the time to research all states, whether they tax coins or not, whether they have personal exemption limits, etc, so the best I can do is say if coins are taxed in your state, and you have sales tax, then most likely you are subject to use tax for out of state purchases, and you should check with a local tax advisor.

Hope that helped.

 

I say , " let's have a Tea Party " .

 

in wisconsin most of the dealers i know charge sales tax. the way i sorta like avoiding tax is by trading coins im not that keen on having.

 

That would be very difficult to prove. It's not like eBay provides information to every state for every IP address that conducts a transaction.

 

That's why most people don't bother to pay their Use Taxes.

 

Yep, most people don't. They never have. Like I said, this has been on the books for years, and mostly ignored. States have not really pressed the matter since it would cost money to enforce and tick taxpayers off. This is how they get around the whole "use tax has to apply to everyone" thing. They just didn't enforce it except for businesses.

The problem is states are broke, they have audited some taxpayers actions and seen the potential now for a lot of money from back use taxes. Also, the current administration has promoted class warfare, making it ok to penalize taxpayers as long as they do it to the "rich". Tax departments are visiting auctions, estate sales, and auditing auction house records in some cases to levy a use tax bill. According to most state laws, once they levy a bill, the taxpayer has to prove that they don't owe the tax, the state doesn't have to prove that they do. States say by definition use tax is owed unless you prove to us its already been paid, and of course most people do not keep those records.

Keep your records of tax paid, and consider how you may dispose of your collection, is what I was warning about. You are not paranoid if they really are out to get you, and in some states they really are nowadays. Hopefully it will not get worst, but looking at some state budgets, I doubt it.

PS, to wheaties point, Ebay doesn't need to, since when they audit you and find the coins they will assess use tax then. It will not matter if you get them from Ebay, out of state, or trading, they will assess the use tax and then you will have to prove to them why you do not owe it. Also, safe deposit boxes HAVE been subpoenaed in these cases, as well as house search warrrants if the state had enough proof of purchases to warrant a search. They are very rare, but have happened.

 

Business A based in state 1 sells mail order into state 2. The business environment has changed significantly over the years. Although business A may not have brick and mortar operations in state 2 there is a good possibility that their bank does. This leaves business A's banking assets exposed to the power of lien and levy by state 2 because business A's bank is subject to the authority of state 2.

 

Nah, you're still paranoid, but with good reason.

 

I still say, Let's have a damn TEA PARTY !

 

From the Texas Administrative Code: "Sales tax is due on the sale in Texas of gold, silver, or numismatic coins or gold, silver, or platinum bullion unless sold to a purchaser in a single transaction in which the total sales price of all the items sold is $1,000 or more."

 

Phart up the dough!

 

Well that's how I usually get around it as I make sure to spend over a grand. I have had the dealer "hold" the coins until the purchase reached over the 1k mark so as to avoid the tax kicking in.
Most states have that same deal.

 

Some states do Duke, but many are tax free on any purchase size. I like TX in a lot of ways, but not this one.