Does your FFL charge you sales tax?

[vega]

Originally Posted by sd1023x

Sure, spread the FUD.....been into shooting for over 15 years in CA, never have paid such a tax, still plenty of good FFL's still around.

And I don't think 'yes' qualifies as an real life example of gunstore being put down by the BOE.

Then out with the FFLs who don't collect tax, CGers could sure use them. There's no problem naming them here right?

[meangreen46]

Originally Posted by sd1023x

Sure, spread the FUD.....been into shooting for over 15 years in CA, never have paid such a tax, still plenty of good FFL's still around.

And I don't think 'yes' qualifies as an real life example of gunstore being put down by the BOE.

I've been shooting twice as long as you in CA and I have ALWAYS paid tax. If your FFL is willing to foot the tax for a gun you didn't even buy at their store....then by all means....keep going there. Judging by their ignorance of the BOE laws, they should be out of business in no time. Then, you'll have no neighborhood gun store to go to.

Along the same lines as jtmkinsd.....the stores I know that add tax are still in business. You pick the one you want to be associated with when the tax man comes knockin.

I will continue to say this: Stop ordering online and support your local stores. Do you think Buds Guns in Kentucky cares about your California gun rights? The local stores do. Unless you find some crazy deal out of state, keep it local.

End Rant

[Kceads]

BOTTOM LINE - Most don't charge sale tax so yes, I'm going to use the FFL that doesn't. More fire arm related regulations. I am trusted to reconcile all my other out of state purchases when filing my taxes but not fire arms; why is this. I'm sick of it!

We know most dealers don't like DROSing guns purchased else where and I suspect that the tax collected makes up for the lost margin and never sent to the IRS. This is the audit I would like to see.

[meangreen46]

This http://www.boe.ca.gov/business/Vol2/suta-q-s.pdf is the bottom line (unfortunately). Specifically sections 495.0843 & 495.0848. I don't like it as much as the next person...but it is what it is.

[tenpercentfirearms]

Ok, let this be a lesson to all dealers.

The BOE is clear that you are considered the retailer and must collect SALES TAX on all retail transactions through your gun shop. If Buds Gunshop sends you a firearm and you transfer it, you owe sales tax on that firearm.

Now the BOE is equally clear that you do not have to collect sales tax from your customers and it is optional whether you will collect a reimbursement for sales tax from your customers. Note the key here is the BOE permit holder is responsible, not the customer.

USE TAX is where you order something from out of state and you pay that USE TAX on your state income tax return at the end of the year. SALES TAX and USE TAX are not the same and are not interchangeable.

Now I charge $50 for any number of long guns transfered and for a single pistol. If I were not to collect the sales tax on the retail sale, then I would be losing money on any and all transfers whose purchase price exceeds $606. I would simply be breaking even at that price. Additionally, this is assuming I am not assessed penalties and interest for failing to pay my sales tax liability on time.

Personally, I have never heard of a real store ever getting audited. Some people claim stores do and some claim they don't. Personally, I don't care. What I care about is not incurring a huge sales tax liability for a customer that is going to be mine to pay with penalties and interest in the rare case I do get audited.

And this is where threads like this get interesting. Since we all know that we are supposed to pay our USE TAX on all out of state purchases (except occasional sales from private parties), the tax is supposed to get paid one way or another. The question dealers need to ask themselves is why would posters on Calguns get so upset about a dealer collecting sales tax that they would recommend you use your credit card and make a charge back, never use any FFL that ever charges SALES TAX on a transfer, or make blanket statements that all FFLs who do so are corrupt and are keeping the SALES TAX to pad their sales(*)?

The answer is these customers do not plan on paying their USE TAX. They want their guns cheaper and they want all SALES TAX liability for their cheating to fall squarely on your shoulders, which if you don't remit the SALES TAX, that is exactly where it will lie. If these posters were such upstanding, honest citizens, they would have no problems having the dealer collect the SALES TAX since it would be one less thing they have to worry about on their income taxes every year.

"Oh, I paid that SALES TAX to the gun shop and here is my receipt" in the case of an extremely rare BOE audit on the customer instead of "Yes tax man, I saved all of my receipts for all of my gun purchases and here they are" for every single gun you buy in a year.

So for those of you who don't like throwing your tax liability square on the shoulders of others, I am not sure if I would judge the complete operation of an FFL based on whether they collect SALES TAX or not. I like to follow the law and that is why I collect it. Now, if one of my competitors doesn't want to collect the SALES TAX (which I personally know some who don't) and you have no intention of paying the USE TAX which means you will get the gun cheaper, by all means use them. If you plan on paying the USE TAX anyway, then what is the difference? In that regard my shop is really no different than theirs and so hopefully you would judge a shop based on customer service, selection, and price.

Stating that you would never use a gun shop that charges SALES TAX on your taxable out of state transfer seems like faulty logic to me. Again, that would assume you plan on paying your USE TAX and that you aren't just trying to cheat the system at the expense of a business that is trying to follow the law. Stating you have no intention of paying the USE TAX and you are going to purchase the firearm from the cheapest source is a logical statement. It might not be rational considering you are breaking the law over probably less than $50 in taxes (quite rarely over $100), but hey, that is your decision to make.

For my gun shop, we don't assume other people's tax liability and we never will, no matter how much potential back taxes we build up.

(*)I use Quickbooks Point of Sale for all of my sales transactions. The amount of work required to void your transaction, remove the SALES TAX, and then create a new receipt where I leave the SALES TAX out is not worth it. Not to mention it would be pointless because in an audit the BOE would just look at all of my voided transactions and notice the originals had SALES TAX and the follow ups didn't. I would be in prison or paying out my rear for the rest of my life. Never mind collecting sales tax and not remitting it has to be the stupidest thing ever since the customer should have a receipt that shows SALES TAX was collected and that could be turned into the BOE and the BOE could quickly discover the SALES TAX was not remitted based on the sales receipt number showing a void.

[J-cat]

You don't have to pay use tax or sales tax on private party transactions. If an out-of-state private seller sends the gun FFL to FFL, that does not magically make it a retail transaction.

A FFL who collects these taxes on PPT's is dishonest and does not plan on ever paying it to the state.

[meangreen46]

Excellent post tenpercent. Somebody should make this sticky since this is one of the most asked questions everytime a new poster signs up. If you look up "BOE Tax Gun" or something like it on Google.....Calguns comes up and it's the same thread over and over.

[kemasa]

Originally Posted by Kceads

We know most dealers don't like DROSing guns purchased else where and I suspect that the tax collected makes up for the lost margin and never sent to the IRS. This is the audit I would like to see.

Well, no FFL sends the sales tax to the IRS, it instead goes to the CA BOE. If the FFL were to collect the sales tax and not send it in, there could be many charges that they could be facing, State charges for collecting and not sending the money in and Federal charges for not paying tax on the income.

If the firearm comes from a private party, is an occasional sale and the person does not have a business AND is willing to document this, then sale tax does not have to be collected.

The funny thing is that many people are saying things that they just can't back up, like the FFL who follows the law and collects sales tax is really just keeping the money to make up for lost profits. As a side note, that is libel if you mention the name of the business since it is claiming an illegal act.

The fact is that a FFL does not have to DROS a firearm purchased elsewhere (PPT excluded). So, if they don't want to do it, they can just charge a lot of money so that people either pay or go away.

I suspect that most FFLs who do not collect sales tax are just not aware of what the law is. They might get away with it for a long time. or never get caught. The problem is that if they get caught, there is going to be one less FFL doing business most likely. You also have to assume that these forums are being read by the CA BOE, so they are most likely getting some nice leads for a source of a lot of money.

If the FFL is aware that they are violating the law and not collecting sales tax, one has to wonder why people would want to do business with such a person. If they are breaking the law there, it might be safe to assume that they might violate other laws and you could end up with a real problem, rather than just wanting the FFL to take all the risk for you, especially when they get NOTHING for the risk.

[Librarian]

So, if they don't want to do it, they can just charge a lot of money so that people either pay or go away.

Just a side note: lots of businesses seem to follow this model.

Used to work for a large software developer; customer came to us (1995-ish) and asked for feature "X". The response was approximately "we could do that, for five million dollars." For an assortment of reasons, we didn't want to do it. Customer didn't want it at that price.

[bruss01]

Originally Posted by meangreen46

Don't say the shop name. Per the California Board of Equalization, the gun has to be taxed. Not saying that you're lieing....just that he's in for a hell of a surprise if he ever gets audited. I had this convo with a store near me the other day. If the receipt doesn't come with the gun, they guess the market value of the gun. If you buy a $500 gun, the tax almost double the $25 he's making on the transfer fee. Bottom line is...they are either eating the tax or are ignorant of the law. I highly doubt a business is going to eat the tax of an item they didn't even sell from their store.

The CA BOE is correct in that any gun a CA dealer sells you has to have tax collected by that CA dealer making the sale. They are wrong in saying that a gun you buy out of state has to have tax collected by a CA dealer who only processes the transfer paperwork i.e. NO SALE TAKES PLACE IN CA. (This is not to say that no tax is owed... simply that the CA FFL is not responsible for collecting taxes on a sale he never made). However, that doesn't mean they won't mistakenly try to prosecute someone due to their misinterpretation. I say take the advantage when you have a savvy dealer who knows the law and doesn't let the BOE misconceptions bother him. But also don't out him in a public forum and paint a target on his back. That's no way to play nice.

For the record, anyone want to look at my tax return and tell me WHO IS GETTING CHEATED? Plenty of people in this state live off the dole, it's not them. Plenty of rich folks have loopholes I can only dream of, and pay pennies in taxes, it's not them. The state is robbing me blind with both hands, but if I take advantage of one little way to try to economize, I'm a cheater? Law does not dictate justice. And I try to live a just life. Even if it doesn't match with every jot and tittle of the "cheaters" who think they have the rest of us under their thumbs.

[Ak707]

i didnt get charged tax from my FFL..35 for him and 25 for the state back ground check is all he charged..

Rob at golden state tactical in sacramento....hes the man!

[meangreen46]

Originally Posted by bruss01

The CA BOE is correct in that any gun a CA dealer sells you has to have tax collected by that CA dealer making the sale. They are wrong in saying that a gun you buy out of state has to have tax collected by a CA dealer who only processes the transfer paperwork i.e. NO SALE TAKES PLACE IN CA. (This is not to say that no tax is owed... simply that the CA FFL is not responsible for collecting taxes on a sale he never made). However, that doesn't mean they won't mistakenly try to prosecute someone due to their misinterpretation. I say take the advantage when you have a savvy dealer who knows the law and doesn't let the BOE misconceptions bother him. But also don't out him in a public forum and paint a target on his back. That's no way to play nice.

Please read all posts before jumping to conclusions. See below:

Originally Posted by meangreen46

This http://www.boe.ca.gov/business/Vol2/suta-q-s.pdf is the bottom line (unfortunately). Specifically sections 495.0843 & 495.0848. I don't like it as much as the next person...but it is what it is.

Where is there room for "misinterpretation"? You are spreading FUD. Again....if stores want to IGNORE the BOE LAWS then that's on them. It is not called "being a savvy dealer".....it's called getting away with it until somebody notices.

[bruss01]

Originally Posted by meangreen46

Please read all posts before jumping to conclusions. See below:

Where is there room for "misinterpretation"? You are spreading FUD. Again....if stores want to IGNORE the BOE LAWS then that's on them. It is not called "being a savvy dealer".....it's called getting away with it until somebody notices.

I read that section... and I maintain they are wrong in their opinion. That section quoted is an opinion or policy, not law. The fact that it is enforced by people who have power to enforce their opinion as if it were law doesn't bother nearly as many people as it ought to. Can they prosecute you for violating their policy? Yep, just like the TSA can throw you in the slammer because you object to getting fondled and they don't like your attitude, "hey you must be one of those terrorists, boy, are we gonna have some fun now..."

[meangreen46]

Originally Posted by bruss01

I read that section... and I maintain they are wrong in their opinion. That section quoted is an opinion or policy, not law. The fact that it is enforced by people who have power to enforce their opinion as if it were law doesn't bother nearly as many people as it ought to. Can they prosecute you for violating their policy? Yep, just like the TSA can throw you in the slammer because you object to getting fondled and they don't like your attitude, hey you must be one of those terrorists, boy, are we gonna have some fun now...

If you paid attention, you would notice that I stated that I didn't agree with it. Thus, I am not "one of those terrorists". It IS LAW and not somebody's opinion. If you wanna jack a thread....go somewhere else. Do you think they would publish an almost 10,000 page guide titled "Business Tax Law Guide" to give their "opinion" of what they think is right/wrong? Wait....nevermind....don't answer that.

[halifax]

Originally Posted by bruss01

I read that section... and I maintain they are wrong in their opinion. That section quoted is an opinion or policy, not law. The fact that it is enforced by people who have power to enforce their opinion as if it were law doesn't bother nearly as many people as it ought to. Can they prosecute you for violating their policy? Yep, just like the TSA can throw you in the slammer because you object to getting fondled and they don't like your attitude, hey you must be one of those terrorists, boy, are we gonna have some fun now...

But their "opinion" is based on the LAW; specifically "the second paragraph of section 6007" which is the LAW:

Revenue and Taxation Code Section 6007: A "retail sale" or "sale at retail" means a sale for any purpose other than resale in the regular course of business in the form of tangible personal property.

When tangible personal property is delivered by an owner or former owner thereof, or by a factor or agent of that owner, former owner or factor to a consumer or to a person for redelivery to a consumer, pursuant to a retail sale made by a retailer not engaged in business in this state, the person making the delivery shall be deemed the retailer of that property. He or she shall include the retail selling price of the property in his or her gross receipts or sales price.

That is the LAW not an opinion.

Furthermore:

The BOE may revoke a permit or license for violation of any provision of the applicable law. For sales tax accounts, the reasons for revoking a seller’s permit are:
1. Failure to file and pay tax return(s).
2. Failure to pay a balance.
3. Failure to post required security, replace security, or post additional security.
4. Failure to keep or make available proper records.
5. Failure to surrender permit for cancellation when not actively engaged in business as a seller of tangible personal property.
6. Failure to comply with any provision of the Sales and Use Tax Law.
7. Failure to comply with Precollection of Sales Tax on Fuel (SG) program requirements.

Good luck running a retail business with out a permit.

[bruss01]

Originally Posted by halifax

But their "opinion" is based on the LAW; specifically "the second paragraph of section 6007" which is the LAW:

That is the LAW not an opinion.

Furthermore:



Good luck running a retail business with out a permit.

You are reading but not understanding. By your interpretation, the UPS driver is obligated to collect sales tax on every book you buy through Amazon.com and the mail carrier for everything you buy off e-bay. Did you even think about that before you wrote it? Never mind, don't answer that...

The CA FFL is not selling ANYTHING. He is not giving you anything he owns, nothing he has in his dealer stock or inventory, nor is he representing the out of state seller. He is simply processing paperwork required by law. He is no more a party to the sale than the delivery guy in the aforementioned transactions. In processing that paperwork he is acting as an agent of the Fed Gov and the State of CA, not the seller of the item. That's an example of the BOE misinterpreting the law to the advantage of state coffers. Just as the IRS misconstrues your wages to be "income" when it never was intended to mean that. But good luck convincing them of that, they have been promulgating that falsehood for decades and terrorizing the populace into believing it. Looks like BOE is trying to do an equally good job of "scaring" people into believing what they want them to believe.

[jtmkinsd]

Originally Posted by bruss01

You are reading but not understanding. By your interpretation, the UPS driver is obligated to collect sales tax on every book you buy through Amazon.com and the mail carrier for everything you buy off e-bay. Did you even think about that before you wrote it? Never mind, don't answer that...

The CA FFL is not selling ANYTHING. He is not giving you anything he owns, nothing he has in his dealer stock or inventory, nor is he representing the out of state seller. He is simply processing paperwork required by law. He is no more a party to the sale than the delivery guy in the aforementioned transactions. In processing that paperwork he is acting as an agent of the Fed Gov and the State of CA, not the seller of the item. That's an example of the BOE misinterpreting the law to the advantage of state coffers. Just as the IRS misconstrues your wages to be "income" when it never was intended to mean that. But good luck convincing them of that, they have been promulgating that falsehood for decades and terrorizing the populace into believing it. Looks like BOE is trying to do an equally good job of "scaring" people into believing what they want them to believe.

I am on the fence on what you are saying, while I understand it, it doesn't matter. It doesn't mean anything unless it is actually litigated. To me it's simply BOE bullying FFL's in CA because the CAN to collect tax on internet sales. And while I thought of it, I wouldn't do it until I'm ready to retire. So unless someone comes along and actually files an action in Federal court, we endure the pain and suck it up.

Tax evaders beware. We charge tax, and if you don't like it go somewhere else. All the gunshops who do transfers for internet or out of state transfers at a reasonable price are doing you all a favor. They don't need the headache just to make a few hundred dollars a month on your transfers, and if people keep on acting like they way they are, those gunshops won't be around anymore for them to do transfers at.

[halifax]

Originally Posted by bruss01

You are reading but not understanding. By your interpretation, the UPS driver is obligated to collect sales tax on every book you buy through Amazon.com and the mail carrier for everything you buy off e-bay. Did you even think about that before you wrote it? Never mind, don't answer that...

The CA FFL is not selling ANYTHING. He is not giving you anything he owns, nothing he has in his dealer stock or inventory, nor is he representing the out of state seller. He is simply processing paperwork required by law. He is no more a party to the sale than the delivery guy in the aforementioned transactions. In processing that paperwork he is acting as an agent of the Fed Gov and the State of CA, not the seller of the item. That's an example of the BOE misinterpreting the law to the advantage of state coffers. Just as the IRS misconstrues your wages to be "income" when it never was intended to mean that. But good luck convincing them of that, they have been promulgating that falsehood for decades and terrorizing the populace into believing it. Looks like BOE is trying to do an equally good job of "scaring" people into believing what they want them to believe.

I am reading the LAW as it applies to me, a dealer, not to anyone else. Clearly, I am the "the person making the delivery" and under the LAW I "shall be deemed the retailer of that property" It does me no good to cry oh boo hoo they aren't making UPS do it.

But after reading your words below, I can understand your rationalizations.

For the record, anyone want to look at my tax return and tell me WHO IS GETTING CHEATED? Plenty of people in this state live off the dole, it's not them. Plenty of rich folks have loopholes I can only dream of, and pay pennies in taxes, it's not them. The state is robbing me blind with both hands, but if I take advantage of one little way to try to economize, I'm a cheater? Law does not dictate justice. And I try to live a just life. Even if it doesn't match with every jot and tittle of the "cheaters" who think they have the rest of us under their thumbs.

[G17GUY]

Originally Posted by hoffmang

Transfers through an in state FFL where the seller is out of state and the buyer is in state are not sales in California. BOE has issued an incorrect letter ruling saying that the in state FFL is required to collect sales tax. Until someone has enough time to challenge that ruling with OAL, it is the only safe way to operate - however the law does not compel an in state FFL facilitating an out of state purchase transaction to collect sales or use tax in most cases. There have been quite a few threads on here hashing out this issue.

For now though, in state dealers need to improperly collect use tax per BOE.

-Gene

http://www.calguns.net/calgunforum/s...d.php?t=143927

[Agro]

Originally Posted by G17GUY

Put the purchase on your cc and dispute the tax charge as you didn't buy it from the dealer and your receipt will clearly show this . Use tax is the purchasers responsibility, and is due April 15th of the following year.

I didn't see much discussion on your point.
This seems like a viable option. I wonder what the CC company would do.

[jtmkinsd]

Originally Posted by G17GUY

http://www.calguns.net/calgunforum/s...d.php?t=143927

As I said...until it's litigated, we have to suck it up

[bruss01]

Originally Posted by halifax

I am reading the LAW as it applies to me, a dealer, not to anyone else. Clearly, I am the "the person making the delivery" and under the LAW I "shall be deemed the retailer of that property" It does me no good to cry oh boo hoo they aren't making UPS do it.

Uh, no, you're reading the law, and then falling for the misinformation BOE is trying to frighten people into believing. I don't blame some people for being scared. But BOE knows they will lose if this goes to court, that will set bad precedent ("bad" from their perspective) and this is why they haven't challenged anyone on it yet. They know it's a losing battle and would rather not have the cat out of the bag. See the opinion of one of our resident legal experts below:

Originally Posted by hoffmang View Post

Transfers through an in state FFL where the seller is out of state and the buyer is in state are not sales in California. BOE has issued an incorrect letter ruling saying that the in state FFL is required to collect sales tax. Until someone has enough time to challenge that ruling with OAL, it is the only safe way to operate - however the law does not compel an in state FFL facilitating an out of state purchase transaction to collect sales or use tax in most cases. There have been quite a few threads on here hashing out this issue.

For now though, in state dealers need to improperly collect use tax per BOE.

-Gene

Gene is saying that it is not SAFE from challenge to operate as I suggest (unless you want to be the test case that blows BOE out of the water) but I maintain they have substantial interest in NOT seeing this end up exposed to the hard cold light of day in a courtroom setting, which affords a certain measure of safety. I salute those who resist the BS and call BOE's bluff. Why aren't they making UPS and Fed Ex do it? Because those companies have very good lawyers and deep pockets, and they (BOE) KNOW that they are WRONG and WILL LOSE if it goes to court. But in the meantime they will happily soak up the funds collected by compliant FFL's who are afraid of them based on the erroneous scare letter they sent out.

[SanPedroShooter]

Originally Posted by bruss01

For the record, anyone want to look at my tax return and tell me WHO IS GETTING CHEATED? Plenty of people in this state live off the dole, it's not them. Plenty of rich folks have loopholes I can only dream of, and pay pennies in taxes, it's not them. The state is robbing me blind with both hands, but if I take advantage of one little way to try to economize, I'm a cheater? Law does not dictate justice. And I try to live a just life. Even if it doesn't match with every jot and tittle of the "cheaters" who think they have the rest of us under their thumbs.

Its every Americans duty to get out of paying as much taxes as possible. I come from a long line of tax "cheaters".
I of course pay all my taxes, even use tax. But if i can get out of paying taxes (legally) you can damn well bet i will.

[halifax]

Bill has his opinion on this subject also:

Originally Posted by bwiese

Firstly, CA FFLs are indeed an agent/representative for state of CA (CA DOJ Firearms Division)...

Any FFL that does not collect sales tax is stupid. Period.

...

http://www.calguns.net/calgunforum/s...4&postcount=79

For now, it is what it is.

[meangreen46]

Originally Posted by bruss01

But BOE knows they will lose if this goes to court, that will set bad precedent ("bad" from their perspective) and this is why they haven't challenged anyone on it yet.

I salute those who resist the BS and call BOE's bluff.

Again....Gene can say what he wants, I can say what I want and you...well...you can attempt to make us believe we're all scared. However, just as pointed out by Gene...we just have to deal with it until somebody challenges it. Do you want to be that person?

The people who "resist" are not doing so because they want to. They are doing it because they are allowed to at this point. In other words, some stores either don't know or don't care and customers are taking advantage of that for the time being. When the stores get caught up in an audit and stop ignoring the laws...the customer who wants to evade the system will move on to the next store mistaking this practice as a reason for loyalty. There will come a time when there will be no more "tax free" stores to go to. Until then, enjoy your extra $50 or so you are saving to make a point.

**Disclaimer (again) - I don't agree with the use tax being charged and I don't own a store. However, I do know what happens when the tax man doesn't get his money and he isn't nice about retrieving it. I would rather avoid issues for what I consider to be an insignificant amount of money compared to the penalties I would have to pay. This is being "cautious" and not "scared".

[21SF]

Man the " keep it local" bull****. Keep it local like canyon sports with there over priced ar's?Daniel defense m4,s that retail for 1200-1300 1700-1900. Hahaha!!

Or diablo valley gun works whos gotta be the rudest set of ugly over weight *** holes to ever sell a gun in there shoe box store.

I would be more than happy to support local, if they didn't take advantage of our situation as california gun owners.

[ZirconJohn]

Originally Posted by tenpercentfirearms

Ok, let this be a lesson to all dealers.

The BOE is clear that you are considered the retailer and must collect SALES TAX on all retail transactions through your gun shop. If Buds Gunshop sends you a firearm and you transfer it, you owe sales tax on that firearm.

Now the BOE is equally clear that you do not have to collect sales tax from your customers and it is optional whether you will collect a reimbursement for sales tax from your customers. Note the key here is the BOE permit holder is responsible, not the customer.

USE TAX is where you order something from out of state and you pay that USE TAX on your state income tax return at the end of the year. SALES TAX and USE TAX are not the same and are not interchangeable.

Now I charge $50 for any number of long guns transfered and for a single pistol. If I were not to collect the sales tax on the retail sale, then I would be losing money on any and all transfers whose purchase price exceeds $606. I would simply be breaking even at that price. Additionally, this is assuming I am not assessed penalties and interest for failing to pay my sales tax liability on time.

Personally, I have never heard of a real store ever getting audited. Some people claim stores do and some claim they don't. Personally, I don't care. What I care about is not incurring a huge sales tax liability for a customer that is going to be mine to pay with penalties and interest in the rare case I do get audited.

And this is where threads like this get interesting. Since we all know that we are supposed to pay our USE TAX on all out of state purchases (except occasional sales from private parties), the tax is supposed to get paid one way or another. The question dealers need to ask themselves is why would posters on Calguns get so upset about a dealer collecting sales tax that they would recommend you use your credit card and make a charge back, never use any FFL that ever charges SALES TAX on a transfer, or make blanket statements that all FFLs who do so are corrupt and are keeping the SALES TAX to pad their sales(*)?

The answer is these customers do not plan on paying their USE TAX. They want their guns cheaper and they want all SALES TAX liability for their cheating to fall squarely on your shoulders, which if you don't remit the SALES TAX, that is exactly where it will lie. If these posters were such upstanding, honest citizens, they would have no problems having the dealer collect the SALES TAX since it would be one less thing they have to worry about on their income taxes every year.

"Oh, I paid that SALES TAX to the gun shop and here is my receipt" in the case of an extremely rare BOE audit on the customer instead of "Yes tax man, I saved all of my receipts for all of my gun purchases and here they are" for every single gun you buy in a year.

So for those of you who don't like throwing your tax liability square on the shoulders of others, I am not sure if I would judge the complete operation of an FFL based on whether they collect SALES TAX or not. I like to follow the law and that is why I collect it. Now, if one of my competitors doesn't want to collect the SALES TAX (which I personally know some who don't) and you have no intention of paying the USE TAX which means you will get the gun cheaper, by all means use them. If you plan on paying the USE TAX anyway, then what is the difference? In that regard my shop is really no different than theirs and so hopefully you would judge a shop based on customer service, selection, and price.

Stating that you would never use a gun shop that charges SALES TAX on your taxable out of state transfer seems like faulty logic to me. Again, that would assume you plan on paying your USE TAX and that you aren't just trying to cheat the system at the expense of a business that is trying to follow the law. Stating you have no intention of paying the USE TAX and you are going to purchase the firearm from the cheapest source is a logical statement. It might not be rational considering you are breaking the law over probably less than $50 in taxes (quite rarely over $100), but hey, that is your decision to make.

For my gun shop, we don't assume other people's tax liability and we never will, no matter how much potential back taxes we build up.

(*)I use Quickbooks Point of Sale for all of my sales transactions. The amount of work required to void your transaction, remove the SALES TAX, and then create a new receipt where I leave the SALES TAX out is not worth it. Not to mention it would be pointless because in an audit the BOE would just look at all of my voided transactions and notice the originals had SALES TAX and the follow ups didn't. I would be in prison or paying out my rear for the rest of my life. Never mind collecting sales tax and not remitting it has to be the stupidest thing ever since the customer should have a receipt that shows SALES TAX was collected and that could be turned into the BOE and the BOE could quickly discover the SALES TAX was not remitted based on the sales receipt number showing a void.

Mannn... good golly Miss Molly, this TPF post need to be an OP and sticky to BOOT...!

Then immediately following the OP... insert posts 2, 3, 4 etc some of the halifax posts and there we have it... the perfect thread!

Nice work gentlemen... very nice

[tenpercentfirearms]

Originally Posted by bruss01

Uh, no, you're reading the law, and then falling for the misinformation BOE is trying to frighten people into believing. I don't blame some people for being scared. But BOE knows they will lose if this goes to court, that will set bad precedent ("bad" from their perspective) and this is why they haven't challenged anyone on it yet. They know it's a losing battle and would rather not have the cat out of the bag. See the opinion of one of our resident legal experts below:

Gene is saying that it is not SAFE from challenge to operate as I suggest (unless you want to be the test case that blows BOE out of the water) but I maintain they have substantial interest in NOT seeing this end up exposed to the hard cold light of day in a courtroom setting, which affords a certain measure of safety. I salute those who resist the BS and call BOE's bluff. Why aren't they making UPS and Fed Ex do it? Because those companies have very good lawyers and deep pockets, and they (BOE) KNOW that they are WRONG and WILL LOSE if it goes to court. But in the meantime they will happily soak up the funds collected by compliant FFL's who are afraid of them based on the erroneous scare letter they sent out.

So again Bruss, what is the point of proving FFLs do not have to pay the tax? Has it been proven that you don't have to pay the USE TAX? Or is that pretty well established?

So if it is the law to pay the USE TAX, why bother to go to a dealer that doesn't? What is the motivation?

I contend it is to avoid paying the USE TAX.

And that is why FFLs need to understand this issue. The people who are most vocal that dealer's should not collect the SALES TAX probably do so in order to avoid paying their USE TAX. Otherwise, they would thank their local dealer for collecting SALES TAX as a service to save their customer's from having to mess with it on their USE TAX section of their state income tax forms.

Will these same customers come to the dealer's aid should you ever get audited? Will they pay all of their back taxes, submit their records to audit to show they paid the USE TAX so in theory the dealer shouldn't have to pay it, and/or kick down for your legal fund so you can fight it and win the case?

I won't be relying on them to do so. I collect the SALES TAX as a "person making the delivery". I am not going to waste my money fighting this in court when it is so easy to set up a way to collect, track, and pay my SALES TAX. The only benefit to fighting the system on this is to help tax cheaters. That would be fine and dandy if they were the only ones with the risk. As it stands, I take all of the financial risk for their cheating the system.

No thank you.

[Timbob55]

yep, sure does.

[kemasa]

One thing that some people are missing is the paying of the money (to an out of state retailer) does not transfer the ownership of the firearm, which occurs when the paperwork is filled out. That is considered the sale. Just like you can pay for a vehicle, the ownership is not transferred until the paperwork is done and you do get charged for sales tax (or use tax) when you purchase a vehicle from out of state.

[bsg]

i pay the amount the FFL charges. i assume i have paid any fees or taxes required of me....

[ghost]

the ffl i use charges $10.00 for out of state firearm shipments and $40.00 for nfa.i cant believe i used to pay $65.00-$100.00 to dros out of state and in state firearm shipments when i lived in cali

[sd_shooter]

The certain "popular FFL who doesn't charge tax" here in San Diego has recently begun charging "Use tax." I just called to confirm.

Now it's not worth buying from Bud's any more...

[cesarv]

The first gun I bought, it came from out state, I was charged tax at the by the FFL. The second gun I bought came from Wisconsin and along with the gun came a letter to my FFL asking them NOT to charge me taxes because they did not have sales taxes in Wisconsin.

[JeffM]

Originally Posted by cesarv

The first gun I bought, it came from out state, I was charged tax at the by the FFL. The second gun I bought came from Wisconsin and along with the gun came a letter to my FFL asking them NOT to charge me taxes because they did not have sales taxes in Wisconsin.

That second note makes no difference. The transfer (the "sale" as noted above) takes place in CA and is subject to CA sales tax. It only makes a difference if the firearm is from a private party as an infrequent/non-commercial sale.

[G17GUY]

Originally Posted by JeffM

That second note makes no difference. The transfer (the "sale" as noted above) takes place in CA and is subject to CA sales tax. It only makes a difference if the firearm is from a private party as an infrequent/non-commercial sale.

[tenpercentfirearms]

Originally Posted by bsg

i pay the amount the FFL charges. i assume i have paid any fees or taxes required of me....

LOL. I guess you could do that and not pay your USE TAX. I don't blame you. If a dealer doesn't collect SALES TAX like they are supposed to, they are still liable for it. If they get audited and end up having to pay, I don't think it is the consumer's responsibility to help them pay it and if the FFL asks, I think you should tell them to pound sand.

That is why it is important to do your homework while you are in business and do the right thing.

[Noobie]

I live in SoCal. My local shop(FFL) will only charge me sales tax on the value if the firearm being transferred by them:
Was purchased new or used by me from an out of state retailer,
Was purchased new or used by me from them,
Was purchased by me from a private party(Ca resident).

1. What if,
I purchase a firearm from a NorCal shop, pay tax on the purchase, and have it shipped to my local shop for transfer?
Will I be double taxed? Once by Ca shop I purchased from, and once by shop doing transfer?

2. What if,
I score a great deal on a firearm from a private party, say paying $100.00 for a piece worth $2500.00. Local shop again does the transfer, what price do they tax?

[halifax]

Originally Posted by Noobie

I live in SoCal. My local shop(FFL) will only charge me sales tax on the value if the firearm being transferred by them:
Was purchased new or used by me from an out of state retailer,
Was purchased new or used by me from them,
Was purchased by me from a private party(Ca resident).* see #2 below

1. What if,
I purchase a firearm from a NorCal shop, pay tax on the purchase, and have it shipped to my local shop for transfer?
Will I be double taxed? Once by Ca shop I purchased from, and once by shop doing transfer?

2. What if,
I score a great deal on a firearm from a private party, say paying $100.00 for a piece worth $2500.00. Local shop again does the transfer, what price do they tax?

1. Show that you already paid CA sales tax and you will not be double taxed.

* 2. No sales tax is due on goods from a private party

(You will pay tax on their transfer fee however.)