Tax on cosignment?

[The Fugitive]

Buying a gun off gunbroker and the FFL happen to be in CA. The gun is off roster but in the the ad it says can done be as ppt, so I was thinking it's a cosignment. A while back my local FFL told me you don't pay taxes on cosignment. Not sure if things have changed now. Anyway, I email and ask the FFL if there was tax on the purchase and the reply was.

"Yes, Sales tax applies to all purchases. Sales Tax exempt PPT purchases only apples to Face to Face transfers made outside the shop and we are only preforming the DROS as required by law."

Isn't drosing the gun cosignment the same as ppt which would be exempt from paying taxes?

[Blade Gunner]

Buying a gun off gunbroker and the FFL happen to be in CA. The gun is off roster but in the the ad it says can done be as ppt, so I was thinking it's a cosignment. A while back my local FFL told me you don't pay taxes on cosignment. Not sure if things have changed now. Anyway, I email and ask the FFL if there was tax on the purchase and the reply was.

"Yes, Sales tax applies to all purchases. Sales Tax exempt PPT purchases only apples to Face to Face transfers made outside the shop and we are only preforming the DROS as required by law."

Isn't drosing the gun cosignment the same as ppt which would be exempt from paying taxes?

[P5Ret]

The difference is that the FFL is involved in the sale on consignment sales as opposed to a PPT between two individuals where all the FFL is doing is providing a service for required paperwork and waiting period.

Your local FFL gave you misleading info. Creating the confusion, and quite possibly a headache for him when the franchise tax board does a sales tax audit.

[edgerly779]

I bought gund from gretas on consignment and no tax

[billkohatsu]

My understanding is that consignment is technically a store sale and requires the FFL to collect tax.

[hermosabeach]

Legally you must pay takes on all purchases.

[taperxz]

I bought gund from gretas on consignment and no tax

If he gets a BOE audit, he will be paying that tax plus interest and penalties for allowing you not to pay the tax.

[Yodaman]

Probably because you brought through an FFL as mentioned above.


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[Baboosh]

Yes, if a gun is on consignment with a dealer you will be paying sales tax.

[Endless]

Legally you must pay takes on all purchases.

Incorrect.

I have never paid sales tax on any firearm I have ever purchased going back 20+ years.

I also don’t ever include “sales tax” in any of my for sale ads because I don’t pay it and either will you.

[edgerly779]

^^^ Are you in ca? Here all dealer sales must pay taxes. ftf ppt no.

[Wordupmybrotha]

Yep, I paid sales tax on consignment.

[EBR Works]

Yes, if a gun is on consignment with a dealer you will be paying sales tax.

This. Same deal in AZ if an AZ resident buys a consignment from a local dealer. Dealers that don't collect sales tax for a consignment sale are doing it wrong.

[mlgs00]

I was told by the manager of a LGS that consignment guns have to be logged into inventory and therefore, tax must be charged. On a PPT, I presume, the gun is not logged into inventory. It is merely held for the mandatory waiting period.

[onelonehorseman]

I have paid sales tax on a consignment purchase through a gun shop as well. It seemed legitimate.