Tax Evasion on Internet Purchases?

[Sinbad the Diver]

I've always found it interesting that on your return, at least in my state, they provide you the opportunity to report your out of state purchases and pay use tax, however, they do not make you check a box that says "I have no out of state purchases to report". I'm not a lawyer, but common sense says a lot of people would think twice about lying on their tax return overtly as opposed to simply ommiting. I understand that either way you are providing a false return, but I do think many people look at those actions as very different.

 

[ekremer]

What about states that do not have an income tax? where does one report it?

 

[sabbath999]

In Missouri, they audit businesses for this... I know of a business that was audited, and fortunately for that company the business was reporting their use tax properly (it was owned by a friend of mine)... the auditor I talked to said that their goal was to audit every business in the state every 10 years.

I have never heard of them auditing an individual for it, but I suppose they could/would... especially if that individual is narked out... say by somebody like an ex-spouse...

 

[sabbath999]

BTW the poll should have an "I take the 5th" option.

 

[RJP]

What about states that do not have an income tax? where does one report it?

Google is Your Friend...

Florida Use Tax on Out-of-State Purchases

"Complete a Mail Order/Out-of-State Purchase Return (form DR-15MO) to file and pay use tax. If the tax owed is less than one dollar, you do not have to file."

 

[J.R.]

BTW the poll should have an "I take the 5th" option.

... make my 5th Scotch please... preferably duty-free...

 

[RJP]

I deduct my scuba gear as a work related.

All well and good, but in PA the "use tax" is still due, unless you are re-selling the gear at retail.

 

[don Francisco]

Most states are extremely about enforcing the use tax provisions of their laws with respect to individuals, but more stringent about businesses. Many a small business owner, while undergoing a sales or income tax audit will be asked to show receipts for things such as office equipment, or supplies (taxable) and if they've not paid sales or use tax will be assessed for them.

For individuals the endforcement is spotty and usually related to big ticket purchases, such as furniture or jewelry paid for with credit cards when discovered on a regular audit of the individual or the business they purchased from.

New York once sent out a slew of tax demand letters after auditing the out of state sales of a big name NY jeweler suspected of fraudulant out of state shipments. (the tipoff, valuable stuff shipped to NJ but not insured).

The issue of sales/use tax on interstate shipments is a complicated one and warrants serious discussion, but not necessarily on this forum.

 

[BDSC]

The issue of sales/use tax on interstate shipments is a complicated one and warrants serious discussion, but not necessarily on this forum.

I thought the reason the thread was started was to discuss it.

 

[sabbath999]

... make my 5th Scotch please... preferably duty-free...

And make it aged single malt while you are at it...