Many states hold sales tax holidays in August for back to school items, but did you know there are sales tax holidays like tornado and hurricane preparedness items, firearms, ammunition, and hunting supplies, and Energy Star appliances. That said, it is great for consumers to benefit from theses holidays throughout the year, but it is the accounts who have to deal with reporting what’s taxable and what’s not throughout the year.
According to a recent Accounting Today article, “There are several states that have a specific line that they would like you to report those sales on,” said CBIZ MHM manager Sonya Daniels. “For instance, in Missouri, it can totally change the actual return that you file. If you normally file a short form, they can actually switch you to a long form just because of the sales tax holiday. In that particular state the local jurisdictions can decide if they want to participate or not."
“Your state may have a sales tax holiday this year and may not have it next year, and they may require you to file it this way, or they may say, ‘Just put them in exempt sales, and if we audit you, you’ll just have support to say it was a sales tax holiday, and we’ll look at it that way,’” said Daniels. “But there’s no across-the-board rule.”
Sales tax holidays can place a potential burden if not remitted correctly to their state’s Department of Revenue. Let Vertex Cloud do the heavy lifting for you.