Why do some transfer FFL charge sales tax and some don't?

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I'd just take it as a lesson and no deal with him again. What did the sales tax come out to? $30-60? How many hours of your life and how much frustration will you put up with for that?

I'd like to know how he knew the price to charge tax against? As the recieving FFL, he had no reason to know.
Everyone seems to be asking this question. Is it that unthinkable that the seller included a receipt in the box? I believe most of my used guns have come with one.
 
As far as how did the seller know... He was admiring the gun and asked how much I paid. I told him. I didn't know he was going to charge me tax. I thought we were just having a friendly chit chat. Bear in mind, no FFL ever in the last 20 years charged me a sales tax on an out of state transfer. I expected the same of this FFL. Boy, was I ever wrong. I should have taken a picture of my face that instant. It was a look of utter shock. :what::eek:

This is a big lesson on my part. I will make sure exactly what I'm required to pay an FFL before I initiate a transfer.
 
You might want to go visit with this fellow with the knowledge you now have. When properly worded, it might encourage him to quickly and quietly return your "tax" money.

Also, you are not dealing with an FFL. He is a dealer with an FFL (Federal Firearms License). I hate being called an FFL. An FFL is a piece of paper. I am a person who has an FFL.
 
+1

I agree that you should go back for a visit and ask that your tax be returned as he is not a legal entity doing business in the state that the firearm came from and has no authority or obligation to collect sales tax on it. Additionally, he has no legal way to pay the taxes to the state that he collected on behalf of, so it's a clear case of tax fraud.
 
Well, actually he does. I'm sure he has a resale permit, or whatever the sales tax license is called in that state, thus he could (should, I guess, since he collected it) report it there, but he then has to call it a sale. That isn't really kosher though, because he didn't sell it. But that's how he would report it and pay it to the state. Remember, sales tax is only collected by merchants to be passed on to the state. They get nothing of it, or near nothing. Some states do provide a miniscule collection fee, and I do mean miniscule!
 
The sales tax on the item belongs to the state it came from, not the state in which the dealer is operating. The dealer is not organized in the originating state, and can not pay taxes there. Collecting taxes on an item for a state that isn't legally entitled to them = fraud.

The seller is responsible for paying collected sales taxes to the jurisdictional authority. That principle is valid in all 50 states.
 
I had this happen to me as well. Needless to say, I found a new FFL.
 
The sales tax on the item belongs to the state it came from, not the state in which the dealer is operating.

So I don't have to pay a sales tax on a car that I buy in my state, if it came from another state?

I though what mattered was where the transaction took place - and that the states are currently arguing that the interstate transactions take place where the buyer lives.

Mike
 
RPCVYemen, you pay your sales tax on your vehicle when you get it licensed. That tax goes to your state, since all car manufacturers are organized in all states as for-profit corporations via "corporate dealerships" in each state.
 
The old original idea is that the seller is responsible for the tax. This prompted states to encourage business development and growth in their states. Now, the "welfare" states with very little manufacturing are trying to turn it into a consumption tax instead of a production tax (or BOTH, in some cases) where the buyer pays the tax to the buyers state. That isn't right, and isn't fair to any of the states and businesses out there organized in a state that provided economic assistance, aide, or tax incentives to the company.

The way I see it, if a state wants to collect a tax on a good, then they need to encourage the manufacturer to set up shop in their state and manufacture it there. That's the way it still is in most places.
 
Asknight--there are obviously state differences. In my state, yes, as a retail seller I collect sales tax, indeed it is specific to the county where the transaction (sale transfer) took place (rates vary by county here). If I make an out of state sale outside the state, I do not collect sales tax. Indeed, the law includes if I make an out of state sale while in state, through the mail, for example, I do not collect sales tax (provided I ship the item out of state). It is specifically entered as an out of state sale, and is a sale for which I do not forward sales tax to the state. If I recieved a firearm and charged sales tax on the transfer, as happened to our poor thread originator, I would have to report it as a sale, hence forward the collected sales tax.
 
moosehunt said:
If I recieved a firearm and charged sales tax on the transfer, as happened to our poor thread originator, I would have to report it as a sale, hence forward the collected sales tax.
Nobody has a problem with sales tax on a service.

It is the dealers who do transfers and charge tax on 'their appraised value' of the firearm which they never had in their stock.
 
I live in tampa Fl and the guy I use does not even charge tax on the transfer fee.He does make a copy of my reciept for some reason.
He makes the call I hand him $25 bucks cash and out the door I go with my gun.
 
tblt said:
I live in tampa Fl and the guy I use does not even charge tax on the transfer fee.He does make a copy of my reciept for some reason.
He makes the call I hand him $25 bucks cash and out the door I go with my gun.
Oh, he's charging you tax, he's just rolled it all into a friendly simple figure.

Here in Texas, services are taxed. Most of the folks I know that offer "flat rates" for services have already figured the tax on their actual rate.

For instance for a $25 transfer fee here in Houston, the actual 'fee' is $23.09 and the tax is $1.91 to reach the 'price out the door'. You can play with the math more if your state charges for a call to NICS or any other charges to figure out what your dealers actual 'fee' is.
 
I've done transfers through mulitple FFLs in Florida. Only one claimed he had to collect tax on the purchase. I asked him ahead of time and he didn't get my business. I don't know how as a small business they would account for the transaction from a bookeeping standpoint if they never purchased or sold the item. The guys probably pocketing the money, but I don't know if it's worth your trouble to pursue.
 
Nalioth--sorry, I used the wrong word. I meant a sales tax on the "price" of the gun, not the service fee. In some states, service (labor) is not subject to sales tax. Also, in some states, mine for certain, it is highly illegal to include sales tax in a price without disclosing such. I suspect the $25 tbit is referring to is the fee that the state charges for a background check call, collected through the dealer. It is not in every state, you may not be familiar with it. In my state, and several others, you don't deal with the federal agency, just the state. They have a fee ($25 is common) that is automatically billed to your account when you (a licensed dealer) make the call, which is required on all transfers except to those with an FFL or a CC permit. Oh, there's no sales tax on that fee, which indeed is a tax already, in actuality.
 
Guys, I went around with all this with something last night and this morning.

IMHO, the guy is doing a service, and that's not sales-taxable. If he collects money for the item in question, then that's sales-taxable.

When I asked the guy at the Missouri Department of Revenue about use tax, the response I got was basically "are you kidding? nobody does that."
 
It is a 20 dollar transfer fee and a 5 dollar background check.
10 min he makes 25 bucks not bad a little paperwork and a phone call.
 
Yugiho, let's look at the numbers.

If your dealer is really collecting sales tax on the purchase price of the gun and doing it legally then he is sending it to the state.

Again if he is legit, then the purchase price of the gun will show up on his income statement. So that would mean that he collected tax that he did not keep and recorded a sale that he did not collect money on.

That would mean that his income is overstated and would increase his income tax liability. If he is doing all of that then he is really dumb and losing money every time he makes a transfer.

Likely, as many have said, he is pocketing the "tax".

I'm not sure you can do much without revealing yourself and your use tax liability to the state.

Name the dealer.
 
I just received a call from the Florida Dept of Revenue

I sent an email regarding the "use tax" on a firearm purchased from a "private individual" out of state to the Florida Dept of Revenue a couple of days ago. They just called me back.

Here's what they said...

"It is our opinion that as long as it was purchased from a "private Individual" and not from a dealer out of state, you don't have to pay the "use tax."

For a written letter attesting to this, he asked me to write a letter (not email) to them requesting documentation.

I'm going to put the letter in the mail tomorrow.
 
Yugiho, sounds similar to AR. AR doesn't want to be bothered about use tax unless it's $2k or above in amount of sale. Just like buying a used car from an individual.
 
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