Unica
Junior Member
Posts โข 2,058
Likes โข 1,220
November 2013
|
Tax question Florida USE tax on original artwork., by Unica on Mar 13, 2014 16:28:28 GMT 1, I'm hoping someone could shed some light on a tax question. I bought an original piece of art from the UK, had it shipped to Florida where I reside. Now 6 months on I receive a demand from Florida Department of Revenue for 6% of the value of the painting. I haven't lived in Florida long. Apparently FL has a statute called the USE tax, and anything brought in to the state is liable for 6% the equivalent of a sales tax.
I was under the impression that original work brought in to the states wasn't eligible for taxation. Can anybody shed some light on this for me. Is tax due? Is there a way round this?
I'm hoping someone could shed some light on a tax question. I bought an original piece of art from the UK, had it shipped to Florida where I reside. Now 6 months on I receive a demand from Florida Department of Revenue for 6% of the value of the painting. I haven't lived in Florida long. Apparently FL has a statute called the USE tax, and anything brought in to the state is liable for 6% the equivalent of a sales tax.
I was under the impression that original work brought in to the states wasn't eligible for taxation. Can anybody shed some light on this for me. Is tax due? Is there a way round this?
|
|
lee3
New Member
Posts โข 832
Likes โข 1,289
November 2009
|
Tax question Florida USE tax on original artwork., by lee3 on Mar 13, 2014 16:40:12 GMT 1, Any state that assesses use tax (and more of them do every day) does so based on the declared value of the shipment as it passes through international customs. I am not aware of any state that does so on intrastate shipments at this time though it's only a matter of time and you're technically still liable even in those cases.
6 months later is a pretty quick turnaround, be happy about that. When CA was legging into the use tax assessment phase ('05ish) they didn't come looking to me until '08 and waived any penalties as long as I paid up which I did. I remember being furious at the thought that three years worth of purchases just cost an extra 9%+. Which is not to sound ungrateful as I recognize in the grand scheme those are very nice problems to have but still not a fun unexpected development.
To your last points, yes the tax is due IF you are a Florida resident and no there is no way around it short of insolvency.
Any state that assesses use tax (and more of them do every day) does so based on the declared value of the shipment as it passes through international customs. I am not aware of any state that does so on intrastate shipments at this time though it's only a matter of time and you're technically still liable even in those cases.
6 months later is a pretty quick turnaround, be happy about that. When CA was legging into the use tax assessment phase ('05ish) they didn't come looking to me until '08 and waived any penalties as long as I paid up which I did. I remember being furious at the thought that three years worth of purchases just cost an extra 9%+. Which is not to sound ungrateful as I recognize in the grand scheme those are very nice problems to have but still not a fun unexpected development.
To your last points, yes the tax is due IF you are a Florida resident and no there is no way around it short of insolvency.
|
|
Unica
Junior Member
Posts โข 2,058
Likes โข 1,220
November 2013
|
Tax question Florida USE tax on original artwork., by Unica on Mar 13, 2014 16:55:34 GMT 1, Thank you for responding, I should count myself lucky that FL is only 6%. It seems a little unfair that artwork is eligible for this tax as its not as if I could of bought this piece of art in Florida and I went to another place to avoid it.
Am I correct in thinking that I don't owe any tax at the Federal level as its original artwork and thats exempt?
I shall think twice now before importing any art into the USA.
Thank you for responding, I should count myself lucky that FL is only 6%. It seems a little unfair that artwork is eligible for this tax as its not as if I could of bought this piece of art in Florida and I went to another place to avoid it.
Am I correct in thinking that I don't owe any tax at the Federal level as its original artwork and thats exempt?
I shall think twice now before importing any art into the USA.
|
|
lee3
New Member
Posts โข 832
Likes โข 1,289
November 2009
|
Tax question Florida USE tax on original artwork., by lee3 on Mar 13, 2014 17:10:01 GMT 1, Jingle, you owe nothing at the federal level until you sell your work at a profit at some future date. The use tax is designed to prevent residents of one state from avoiding sales tax for out of state purchases. Its very easy for states to assess this through customs which is where the vast majority of them are doing so now. They are forward looking however and eventually looking to tax internet purchases from out of state vendors who are not large enough (IE most non-Amazon retailers) to manage numerous state regulations on their own. I hear you, it stinks but chalk it up to being able to even buy in the first place. I will also caution you that if you are loaning art to shows, this tax has an ugly way of showing up if pieces go international and return home. You'll eventually remedy it without owing cash in those cases but certainly a case of no good deed.
Jingle, you owe nothing at the federal level until you sell your work at a profit at some future date. The use tax is designed to prevent residents of one state from avoiding sales tax for out of state purchases. Its very easy for states to assess this through customs which is where the vast majority of them are doing so now. They are forward looking however and eventually looking to tax internet purchases from out of state vendors who are not large enough (IE most non-Amazon retailers) to manage numerous state regulations on their own. I hear you, it stinks but chalk it up to being able to even buy in the first place. I will also caution you that if you are loaning art to shows, this tax has an ugly way of showing up if pieces go international and return home. You'll eventually remedy it without owing cash in those cases but certainly a case of no good deed.
|
|
Unica
Junior Member
Posts โข 2,058
Likes โข 1,220
November 2013
|
Tax question Florida USE tax on original artwork., by Unica on Mar 13, 2014 17:21:00 GMT 1, Lee3, thanks yes I will use this as a learning experience. I've been trying to get in touch with the auditor, they haven't sent me a bill of the exact amount I owe, I'm hoping they let me pay just the 6% and don't try and stick me with penalties. Its an honest oversight, I didn't know about this tax until now. I will pay it and move on.
Yes, only a matter of time before they start going after the intrastate commerce i'm sure. I appreciate the heads up and can see how they would try and collect every time a piece is shipped in and out internationally. I expect they comb through the shipping companies import papers looking for large value items.
Lee3, thanks yes I will use this as a learning experience. I've been trying to get in touch with the auditor, they haven't sent me a bill of the exact amount I owe, I'm hoping they let me pay just the 6% and don't try and stick me with penalties. Its an honest oversight, I didn't know about this tax until now. I will pay it and move on.
Yes, only a matter of time before they start going after the intrastate commerce i'm sure. I appreciate the heads up and can see how they would try and collect every time a piece is shipped in and out internationally. I expect they comb through the shipping companies import papers looking for large value items.
|
|
lee3
New Member
Posts โข 832
Likes โข 1,289
November 2009
|
Tax question Florida USE tax on original artwork., by lee3 on Mar 13, 2014 17:23:56 GMT 1, >>>I'm hoping they let me pay just the 6% and don't try and stick me with penalties<<
You should not have any penalties yet. Use tax is an annual assessment paid to the state with your return. Since this was a '13 purchase, you include it with your state return which is due in April. Good luck and enjoy your art.
>>>I'm hoping they let me pay just the 6% and don't try and stick me with penalties<<
You should not have any penalties yet. Use tax is an annual assessment paid to the state with your return. Since this was a '13 purchase, you include it with your state return which is due in April. Good luck and enjoy your art.
|
|
๐ธ