BOE overtaxed letter

[SEABUG32]

Got a letter from BOE stating I over taxed my customers and to either pay them back or send a check to BOE. DOJ sent a letter to collect sales tax on out of state purchases years ago. Now do they want me to put what they paid for the item as my income (NO). So im going to call and try to educate them and ask if maybe I should only collect tax on my fee only. How do you think this will go? Has anyone else had this problems

[halifax]

If they weren't specific how do they know you over-taxed someone? If they were specific, did you over-tax a customer? If you didn't keep the money you collected, then the BOE already has it.

[Tyke8319]

As it was explained to us by BOE, if you take in a NEW, we'll assume gun, from retailer from out of state you charge the customer "use tax". (7.50% in my case...sale % as sales tax).
If you take in a USED item from out of state and from a private party, no tax is charged. That process has worked for us with no problems from BOE (thus far).

[halifax]

As it was explained to us by BOE, if you take in a NEW, we'll assume gun, from retailer from out of state you charge the customer "use tax". (7.50% in my case...sale % as sales tax).
If you take in a USED item from out of state and from a private party, no tax is charged. That process has worked for us with no problems from BOE (thus far).

That's the way it was but now they see it like this

In situations where an in-state federal firearm licensed dealer registers and delivers a firearm
to a California purchaser for an out-of-state retailer or out-of-state private party, RTC section
6007, provides, in part:


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.

In-state private party sales, however, are still not taxable unless the dealer was part of the sale.

http://www.calguns.net/calgunforum/archive/index.php/t-534146.html

[kemasa]

There is also:

http://www.calguns.net/calgunforum/showthread.php?t=366781

C&R handguns, where the seller is a private party, it is an occasional sale and not from a business and the buyer has a C&R FFL, then it is exempt from sales tax even when it comes from out of state since it is CA law which requires that it goes through a FFL, not Federal law.

[Tyke8319]

Thanks for the heads up. We've been working off the Nov. 11, 2011 BOE letter as I indicated.
We'll make the appropriate changes......!!
Can I assume (hate that word) that it's listed as "use tax" rather than "sales Tax"??

[Tyke8319]

Has there been any recent letters from BOE regarding this topic? I printed off a copy of the Feb. 10. 2012 letter entitled "Transfer and registration of Firearms" from BOE.

[halifax]

Thanks for the heads up. We've been working off the Nov. 11, 2011 BOE letter as I indicated.
We'll make the appropriate changes......!!
Can I assume (hate that word) that it's listed as "use tax" rather than "sales Tax"??

It's all sales tax because you are the retailer by their definition.

[rbetts]

Huh? Since when is a private party out of state sale taxable.

In situations where an in-state federal firearm licensed dealer registers and delivers a firearm
to a California purchaser for an out-of-state retailer or out-of-state private party, RTC section
6007, provides, in part:


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.

Since a private party is not a "retailer not engaged in
business in this state" no such tax is due.

Anybody have a letter stating otherwise?

[Baboosh]

It's all sales tax because you are the retailer by their definition.

It has always been my understanding that a transfer from an individual out of CA to an individual in CA is not taxable as long as it is infrequent.

I do not charge tax on transfers from individuals.

[kemasa]

Huh? Since when is a private party out of state sale taxable.

Since the end of 2011.

...
Anybody have a letter stating otherwise?

Yes.

http://www.calguns.net/calgunforum/attachment.php?attachmentid=311866&stc=1&d=1395273663

It has always been my understanding that a transfer from an individual out of CA to an individual in CA is not taxable as long as it is infrequent.

I do not charge tax on transfers from individuals.

Well, I hope you have saved your money or like free room and board, as well as all the sex that you don't want.

The only exception is for a C&R from a private party where the CA resident has a C&R FFL. The CA BOE is using the excuse that Federal law requires that the transfer go through a FFL in the state of residence of the buyer. In the case of a C&R handgun, it is CA law, not Federal law, which requires that it go through a CA FFL.

[Baboosh]

Since the end of 2011.



Yes.

http://www.calguns.net/calgunforum/attachment.php?attachmentid=311866&stc=1&d=1395273663

Well, I hope you have saved your money or like free room and board, as well as all the sex that you don't want.

The only exception is for a C&R from a private party where the CA resident has a C&R FFL. The CA BOE is using the excuse that Federal law requires that the transfer go through a FFL in the state of residence of the buyer. In the case of a C&R handgun, it is CA law, not Federal law, which requires that it go through a CA FFL.

Thanks for the clarification. New policy time.

[rbetts]

You learn something new everyday. Bummer for the Folks buying guns out of state and thinking a private party sale is going to save them on tax. Thanks for the clarification

[SEABUG32]

Thanks for all the info, I screwed up on the online form and sent them a check so they will leave me alone..