Tax on out of state handgun purchase

[eightbit]

If I buy a hand gun from out of state, say from budsgunshop.com, shipped from Lexington, do I have to pay sales tax on it when I pick it up from my local FFL?

[pgaplayerless]

Depends on the FFL.

DADT.

[zigziggityzoo]

I believe state tax code requires the FFL to collect and remit sales taxes to the state on all transfers.

[j69charger500]

My ffl never used too but when i sent my buddy to him lately he was charged sales tax. New law?

[mjrampy1]

My ffl never used too but when i sent my buddy to him lately he was charged sales tax. New law?


law not new...state frantic for money and turning over every stone more the issue

[shurhouse]

If your not paying the ffl for the firearm, how does he know what you paid the seller? I'm sure I'm missing something here.

[Mike in Michigan]

I have a letter from the Michigan Secretary of State that is a several years old stating that I must collect sales tax because, as far as MI is concerned, I am the "sales agent" and, therefore, obligated to collect the tax. FFL's who do not collect the tax may be doing their buddies a favor but that buddy will be long gone when the tax man shows up.

[pgaplayerless]

If your not paying the ffl for the firearm, how does he know what you paid the seller? I'm sure I'm missing something here.

one can inherit awful lot of firearms from out of state...

[partdeux]

you are required by law to pay state sales tax on out of state purchases ;)

[zigziggityzoo]

you are required by law to pay state sales tax on out of state purchases ;)
No that's called Use Tax.

[partdeux]

{sigh}

you are required to pay 6% use tax on out of state purchases, internet or otherwise.

Sales tax, use tax, whatever, it still costs you 6% :)

[eightbit]

I was not trying to avoid the tax, just wondering if I need to pay it now or at the end of the year when I pay the tax on the rest of my internet purchases. :thumbup:

So the answer is some FFL's collect it and some don't. I guess I'll be ready to pay it when the gun comes in.

[partdeux]

Ior at the end of the year when I pay the tax on the rest of my internet purchases. :thumbup:
:twisted:

[Imshootin]

I was not trying to avoid the tax, just wondering if I need to pay it now or at the end of the year when I pay the tax on the rest of my internet purchases. :thumbup:

So the answer is some FFL's collect it and some don't. I guess I'll be ready to pay it when the gun comes in.

Hey, good filters, :thumbup: and I like your reply above. You'll do fine here weeding through much of the misinformation posted here by some of the experts. :pip:

[pistoltraining]

Your FFL is supposed to collect tax.


If I buy a hand gun from out of state, say from budsgunshop.com, shipped from Lexington, do I have to pay sales tax on it when I pick it up from my local FFL?

[ChaneyD]

If you paid the tax out of state, you won't have to pay it again here.

[Mike in Michigan]

I tell my customers to pay the tax to the seller if the state of origin's tax rate is lower than 6%.
The idea of the FFL not collecting the tax and the buyer claiming it on his personal MI tax return at the end of the year was what I did until I got the letter from the MI Sec of State. Bottom line is the transferring FFL is legally obligated to collect the MI tax unless the buyer can present proof the tax was paid at the source. I have lost business from a few who refused to believe the law existed and others who told me I was ripping them off. Better that than trouble with the tax man.
Yes, transfers between relatives are not taxable. In that case, I retain contact information of the seller with the 4473.
At any rate, few firearms I receive for transfer have an invoice with the actual pricing. I rely on the buyer to tell me what they paid for the item.

[isw49017]

What about a gift firearm that I receive from someone out of state? That needs to be sent through an FFL also right?

[Buffman]

If you paid the tax out of state, you won't have to pay it again here.

Convince your FFL of that.... I got double dipped on sales tax when I purchased a handgun in Indiana and shipped it up here. I dont know if Midwest was supposed to exempt me from sales tax because of out of state purchase, but I had to pay it again when I collected firearm from FFL. Ohh well I'll just deduct it from my taxes this year.

[Mike in Michigan]

This may have changed but, I was told by the Sec of State 30 years ago, If the gift is from a relative, no sales tax is due on a motor vehicle. Whether this applies to interstate sales, I do not know. Anyone out there know different or can confirm this?

[langenc]

Convince your FFL of that.... I got double dipped on sales tax when I purchased a handgun in Indiana and shipped it up here. I dont know if Midwest was supposed to exempt me from sales tax because of out of state purchase, but I had to pay it again when I collected firearm from FFL. Ohh well I'll just deduct it from my taxes this year.


Guess I need to get your accountant or have mine talk with yours!!

I understand about purchases but am waiting to see about inheritances-if any one knows and is not speculating.

[zigziggityzoo]

This may have changed but, I was told by the Sec of State 30 years ago, If the gift is from a relative, no sales tax is due on a motor vehicle. Whether this applies to interstate sales, I do not know. Anyone out there know different or can confirm this?
Since when is this about cars?

[Mike in Michigan]

ZZZ,
We are discussing sales tax. Firearm, vehicle, gift, purchase, all related to transferring ownership of an item and the state getting their piece of the action.
Mike

[eightbit]

What about a gift firearm that I receive from someone out of state? That needs to be sent through an FFL also right?
As far as I know the only way to ship any gun is to an FFL.

Comparing gun taxes to car taxes is not helpful. Cars are registered differently and sales tax collection enforcement on them is done differently. If every gun had to be registered every time it changed hands you can bet they'd charge sales tax on it regardless of whether it was new, used, private party sale or a dealer.

[Mike in Michigan]

I give up.

[jmacken37]

As Mike in Michigan pointed out the State Dept. of Revenue considers FFL holders who handle out of state transfers to be "agents of the seller" and because the transaction is finalized (form 4473 is filled out in MI) in Michigan, the tax is due. It wouldn't be as big a deal but the Dept. of Revenue knows that FFL holders are required to keep detailed records of all transactions.

Insult to injury, the State requires that FFL holders collect sales tax on the total cost of the transfer including shipping fees and the local FFL transfer fee.

Guess who is going to get the bill for the taxes on the "fair market value" of all transferred guns if the tax isn't paid? I've handled transfers for >$10K guns and have no desire to be stuck with that bill. As a secondary issue, tax evasion and the ramifications for your long-term ability to possess guns legally is bad juju.

Just pay the tax that is due and be done with it.

Jake

[eightbit]

Just pay the tax that is due and be done with it.

Technically people should pay sales tax on every purchase, even from a private seller on a used item. The only reason we don't is because it's unenforceable, in the case of cars and guns that go through an FFL they've found a way to enforce it.