Sales Tax - Educate Me Please
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Anonymous
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Live in MD, where I'm assuming sales tax is higher than VA?
we are in the market to buy furniture. Does it make sense to drive to VA to purchase? Live inside beltway and could drive to Dulles or fairfax if it makes sense. purchasing about $3K worth of furniture. |
Anonymous
| VA state sales tax is 5% vs. MD's 6%. It's pretty much a wash unless you are going to spend tens of thousands of dollars. |
Anonymous
| You will save $30. |
Anonymous
| thanks! yeah, doesnt make sense for $30! |
Anonymous
| I think that if even if you buy furniture in Virginia, if you have it delivered to Maryland, you will still pay Maryland sales tax. |
Anonymous
You still have to pay Maryland sales tax. Or, if not sales tax, the state's use tax. One way or another, you owe the revenue. |
Anonymous
| OP you couldn't Google this in the 21 minutes it took to get an answer? |
Anonymous
Maybe you might owe in some states via a use tax, but as a practical consideration, few people actually pay such use taxes, and the states don't spend much time enforcing the use taxes in this sort of one-off context. |
Anonymous
| If there is someone out there smarter than I am, can you explain the details of how use tax works? I see this -- http://individuals.marylandtaxes.com/usetax/usetax.asp -- and it makes me wonder if I'm actually entitled to a tax break when I shop out of state. For example, if I buy a lamp while on a beach vacation in NJ (state sales tax of 7%), can I tell the seller I'm from Maryland and will use the lamp in Maryland, and thus avoid paying state sales tax? Yes, I'd be obligated to later pay 6% sales tax to Maryland, but I'd save on the difference. Is that really how it works? Do I just need to produce my MD driver's license to avoid state sale taxes from other states? |
Anonymous
The enforcement mechanism is when she fills out the paperwork in the Virginia store. They will charger her MD tax and remit to MD. Unless she lies about her address and gives one in Virginia and doesn't have it delivered. |
Anonymous
I don't think that's true. From the Maryland web page linked above: "When you purchase goods from businesses located outside of Maryland, they are not required to collect Maryland's sales tax unless they have a physical location, or deliver services, in Maryland. Also, you are not required to pay the sales tax in the state where the business is located. However, you are required to pay the 6 percent use tax directly to the Comptroller of Maryland by filing the consumer use tax return by the appropriate due date." |
Anonymous
I think vendors are generally obligated to charge you sales tax if the item is delivered to you in that state. If you go to NJ and have the lamp shipped to MD then the vendor might not charge you sales tax, but you would owe use tax. Technically, you owe use tax in MD even if you pay sales tax in NJ, but (1) you are allowed to offset the sales tax paid to another state against the use tax owed to MD; and (2) no one bothers with use tax except for very big ticket items (esp. cars, which need to be registered). |
Anonymous
| buy a PO box in deleware that's the real savings. |
Anonymous
| But you would have to drive to DE to pick up your items. You use state services..pay the tax. |