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Having to pay White Flash Sales Tax

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taman25thc02

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Can anyone tell me whether it would be worth it to still use white flash considering I do not get the sales tax discount? I actually live about 30 min. away from their headquarters location in Houston, Texas. It comes out to about $500 in tax which while not entirely significant, is a good chunk of money for a college student. The diamond I''m looking at will run about 5800 with the bank wire discount + tax. My other option is blue nile. I like the hearts and arrows diamond offered by White Flash but the Sales tax is hard to get over.
 

kenny

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Discount?
There is no discount.

You are legally and ethically required to report that purchase and pay use tax when you file your state taxes.
 

RockDoc

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Perhaps if you have it shipped to an appraiser, checked out and then shipped to you, they wouldn''t have to charge you the sales tax.

Check with WF to make sure about this.

Rockdoc
 

diamondseeker2006

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I think having the opportunity to go to WF and choose the diamond is really worth paying the sales tax.
 

Cehrabehra

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Date: 2/5/2007 10:14:28 PM
Author: kenny
There is no discount.

You are legally and ethically required to report that purchase and pay use tax when you file your taxes.
what???

Not all states have sales tax. Oregon doesn''t. If he buys from whiteflash, sure he has to pay HIS OWN STATE taxes because well, its his state too. But if he buys from blue nile in seattle - he wouldn''t have to pay sales tax to washington state.

What exactly are you saying he is legally and ethically required to report and to whom??
 

kenny

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(S)he said (s)he lives 30 minutes from Houston and is hoping to "get the sales tax discount".
So apparently there is sales tax in Texas, where (s)he lives.

In my state, california we report out of state purchases and pay tax. (Well, a few of us do.)
When I bought from Bluenile I reported the sale when I filed my state return and paid the use tax.

What happened to honest, ethics and obeying laws?

Talk to teenagers today.
Most download music . . . "for free".
 

Cehrabehra

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Date: 2/5/2007 10:31:56 PM
Author: kenny
(S)he said (s)he lives 30 minutes from Houston and is hoping to ''get the sales tax discount''.
So apparently there is sales tax in Texas, where (s)he lives.

In my state, california we report out of state purchases and pay tax. (Well, a few of us do.)
When I bought from Bluenile I reported the sale when I filed my state return and paid the use tax.

What happened to honest, ethics and obeying laws?

Talk to teenagers today.
Most download music . . . ''for free''.
I''m going to ignore the comments about ethics because I don''t think we can come to any conclusion here that someone is being unethical.

It is my understanding that there is no sales tax for items purchased out of state. I know that some lawmakers were trying to pass that but it is my understanding that it failed. Do you know otherwise?

If you are reporting purchases made out of state and paying taxes on them - who exactly are you paying taxes TO? The state that the purchase originated in or the state you live in?

Since when are sales taxes included in state returns? Is this something new in california? Never heard of it.
 

denverappraiser

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Sales tax is imposed by various states, counties, water districts and the like on the consumers who live in their taxing area, not on the merchants. Every state that has a sales also has a use tax for exactly the same amount and residents of those states who buy things where the required tax has not been collected are expected to fill out a tax form and remit the taxes themselves. Customers who buy things from merchants within their own state aren’t required to do this because the merchant is required to do it on their behalf. The taxable obligation by the resident remains the same either way.



Here’s the form used by the Texas department of revenue to report these taxes with a fairly clear explanation of when they require it’s use.
http://www.window.state.tx.us/taxinfo/taxforms/01-156.pdfThere are several states, including California, that have this as a line item on their annual state tax return.


Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Appraisals in Denver
 

diamondseeker2006

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Some states have that provision on the state tax return, Cehra. My state gives you the option of adding up actual out-of-state purchases if you have all the receipts OR paying a small suggested amount based on income. It seems perfectly ethical to me to pay the smaller of the two since I am given the choice.
 

diamondglee

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He's right. If you purchase an item out of state and don't pay tax, you are liable to pay tax at the california rate...or whatever your state rate is.... when you file your tax return. Its not called sales tax its called use tax.
 

taman25thc02

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***I see where I might have confused people. Texas has no state tax. Only federal so thats not the issue at stake. The discount I was referring to was the bank wire vs credit discount.

My problem is if I lived in another state(without state tax) I wouldn't pay White Flash sales tax on my purchase. I live in Texas therefore I pay taxes on anything I buy online that has a location in Texas. So my question was is paying the extra 500 dollars in Sales tax immediately upon checkout worth it to get it from White Flash vs. Blue Nile? In your opinions. I know ultimately its up to me but I want some other voices to chime in.

In the end I'm not saving the extra money that alot of people go online to save but I'm right by the store as well. I'm not sure if you can visit their actual location over here or not. It's an office building. But being a soon to be college grad, is it worth the money. I'm looking at a ACA Hearts and Arrows and brilliance is a big factor to me. Blue NIle does not show me any such graphs of their diamonds.
 

the other Jake

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What they are saying is that you are SUPPOSED to pay the sales tax anyway. If you lived in Colorado you would still are supposed to pay it, its just WF doesn''t take the money for you. If I were you I would go and pick out the stone in person. That would be a great experience.
 

taman25thc02

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Do they allow picking out the stone in person? This would seem to be almost like a store and create store overhead to factor into costs?
 

Kaleigh

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Date: 2/5/2007 10:52:49 PM
Author: the other Jake
What they are saying is that you are SUPPOSED to pay the sales tax anyway. If you lived in Colorado you would still are supposed to pay it, its just WF doesn''t take the money for you. If I were you I would go and pick out the stone in person. That would be a great experience.
Ditto!!!
 

Cehrabehra

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Date: 2/5/2007 10:44:48 PM
Author: diamondglee
He''s right. If you purchase an item out of state and don''t pay tax, you are liable to pay tax at the california rate...or whatever your state rate is.... when you file your tax return. Its not called sales tax its called use tax.
weird - we have no sales tax in oregon and I''ve never heard of "use" tax. Here this is all moot :D And back when I lived in california we had little reason to make out of state purchases, certainly nothing of note!
 

the other Jake

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"Do they allow picking out the stone in person? This would seem to be almost like a store and create store overhead to factor into costs? "

I think you just have to set up an appointment.
 

kenny

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Date: 2/5/2007 10:41:00 PM
Author: Cehrabehra
Date: 2/5/2007 10:31:56 PM



If you are reporting purchases made out of state and paying taxes on them - who exactly are you paying taxes TO? The state that the purchase originated in or the state you live in?


Since when are sales taxes included in state returns? Is this something new in california? Never heard of it.
I pay it to California, the state I live in.
Today it is voluntary.
Since cross-state commerce is growing (especially via the Internet) and many people have "never heard" they are supposed to pay use tax to their state of residence, states are loosing a lot of revenue.

They are trying to get this fixed by forcing merchants to collect during the sale for whatever state the customer lives in.

So the ethics issue comes in when someone is not obeying, or is not aware of, the law.
Calling it a discount is a new one though.
 

the other Jake

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Date: 2/5/2007 10:55:24 PM
Author: Cehrabehra

Date: 2/5/2007 10:44:48 PM
Author: diamondglee
He''s right. If you purchase an item out of state and don''t pay tax, you are liable to pay tax at the california rate...or whatever your state rate is.... when you file your tax return. Its not called sales tax its called use tax.
weird - we have no sales tax in oregon and I''ve never heard of ''use'' tax. Here this is all moot :D And back when I lived in california we had little reason to make out of state purchases, certainly nothing of note!
States that don''t have it are taxing you somewhere else instead... trust me
 

taman25thc02

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We dont file state taxes in Texas and I''ve never had to include out of state purchases in a federal return. Never had an issue with the government either. So really, I guess my question makes no sense to many because if you have state tax then buying something online and still having to pay sales tax is not beneficial.

It''s like ebay. You buy stuff all the time from other people and pay no sales tax. Thats why I buy on ebay in addition to lower prices.
 

denverappraiser

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That is, of course, entirely up to you. We’re just pointing out that the $500 isn’t a savings granted by Whiteflash’s for their out of state customers, it’s called tax evasion. A lot of people do it, and a lot of people get away with it. The government’s irrelevance lasts only until the audit. Most taxpayers aren't audited very often so I suppose the risk is relatively low.

Again, here's the rules, straight from the Texas department of revenue.
http://www.window.state.tx.us/taxinfo/taxforms/01-156.pdf

Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Appraisals in Denver
 

kenny

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Taman if there is no state sales tax in Texas, that you were trying to evade, then I extend my apologies to you.

But the issue is very real.
Billions of tax on out of state purchases is not being paid today.
Look for your government to close this gap soon as Internet commerce grows.
 

Cehrabehra

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Date: 2/5/2007 10:58:29 PM
Author: kenny

Date: 2/5/2007 10:41:00 PM
Author: Cehrabehra

Date: 2/5/2007 10:31:56 PM



If you are reporting purchases made out of state and paying taxes on them - who exactly are you paying taxes TO? The state that the purchase originated in or the state you live in?


Since when are sales taxes included in state returns? Is this something new in california? Never heard of it.
I pay it to California, the state I live in.
Today it is voluntary.
Since cross-state commerce is growing (especially via the Internet) and many people have ''never heard'' they are supposed to pay use tax to their state of residence, states are loosing a lot of revenue.

They are trying to get this fixed by forcing merchants to collect during the sale for whatever state the customer lives in.

So the ethics issue comes in when someone is not obeying, or is not aware of, the law.
Calling it a discount is a new one though.
I have a hard time using ethical violation where ignorance is concerned. JMO on that one. We''ve been online since jan 96 and have lived in oregon since oct 96 - prior to that and even for a few years after that we didn''t really do purchases from other states unless we were physically IN the other state. I have never heard of USE TAX. Let me ask this... we filed california taxes until my husband got out of the navy in 96 - was this ''use tax'' on the forms prior to that? Then again I think we filed the EZ and short forms.... now everything is line itemed and a multitude of attachments LOL I feel in the twilight zone that I''ve never heard of USE tax - hence my reluctance to consider it an ethical violation LOL
 

Bunnifer

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Date: 2/5/2007 10:48:32 PM
Author: taman25thc02
***I see where I might have confused people. Texas has no state tax. Only federal so thats not the issue at stake. The discount I was referring to was the bank wire vs credit discount.


My problem is if I lived in another state(without state tax) I wouldn't pay White Flash sales tax on my purchase. I live in Texas therefore I pay taxes on anything I buy online that has a location in Texas. So my question was is paying the extra 500 dollars in Sales tax immediately upon checkout worth it to get it from White Flash vs. Blue Nile? In your opinions. I know ultimately its up to me but I want some other voices to chime in.


In the end I'm not saving the extra money that alot of people go online to save but I'm right by the store as well. I'm not sure if you can visit their actual location over here or not. It's an office building. But being a soon to be college grad, is it worth the money. I'm looking at a ACA Hearts and Arrows and brilliance is a big factor to me. Blue NIle does not show me any such graphs of their diamonds.
All I think Kenny is saying is that, either way (whether you decide to purchase from WF or BN), you will be required to pay either a sales tax (if you buy from WF) or be required to report and pay a use tax (if you buy from BN). A purchaser is required to pay a use tax (usually equal to the rate of sales tax) on all purchases bought out-of-state if the purchaser were to pay sales tax if the purchase had been made in-state. This is generally done to protect in-state businesses from unfair competition from out-of-state vendors.

In other words, suppose you bought a diamond from BN and because it was an out-of-state purchase, you were not charged sales tax. If you would have paid sales tax on the diamond you purchased from BN (which you would have), you are required to report and pay the use tax on the diamond, which is equal to TX sales tax rate of 6.25%.

That's all.

ETA - I think TX does have sales tax ... http://www.cpa.state.tx.us/taxinfo/sales/faq_use.html#use2
 

Cehrabehra

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Date: 2/5/2007 10:58:59 PM
Author: the other Jake

Date: 2/5/2007 10:55:24 PM
Author: Cehrabehra


Date: 2/5/2007 10:44:48 PM
Author: diamondglee
He''s right. If you purchase an item out of state and don''t pay tax, you are liable to pay tax at the california rate...or whatever your state rate is.... when you file your tax return. Its not called sales tax its called use tax.
weird - we have no sales tax in oregon and I''ve never heard of ''use'' tax. Here this is all moot :D And back when I lived in california we had little reason to make out of state purchases, certainly nothing of note!
States that don''t have it are taxing you somewhere else instead... trust me
oh yes, absolutely - we have pretty high state wage taxes as well as property taxes... but I have to say, given the choice between the two, I rather prefer it the way it is, makes it SO easy when you go to buy a burger and it says .99 cents and you hand them a buck and get a penny back LOL
 

taman25thc02

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Feb 5, 2007
Messages
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I completely understand that the state is losing money. But that issue is used to market things to us all the time. In fact, I believe the government is working on it. But for now, I don''t see where it would affect federal taxes since we only pay local sales tax according to city tax rates. I''m not tax specialist either though.

In the end it comes down to would you pay 500 dollars more than you had planned for the diamond I had mentioned above vs. Blue Nile.
 

kenny

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Per a quick google:
snip "Alaska, Delaware, Montana, New Hampshire, and Oregon are the five states that currently do not impose general sales taxes at the state level."



So that means Texas Does have sales tax.

Seven states do not have income tax: Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming

So, legally and ethically, since you are a resident of Texas you must pay sales tax to Whiteflash.
That is not a discount they are extending to residents of other states.
 

Cehrabehra

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Date: 2/5/2007 10:59:48 PM
Author: denverappraiser

That is, of course, entirely up to you. We’re just pointing out that the $500 isn’t a savings granted by Whiteflash’s for their out of state customers, it’s called tax evasion. A lot of people do it, and a lot of people get away with it. The government’s irrelevance lasts only until the audit. Most taxpayers aren''t audited very often so I suppose the risk is relatively low.

Again, here''s the rules, straight from the Texas department of revenue.
http://www.window.state.tx.us/taxinfo/taxforms/01-156.pdf


Neil Beaty
GG(GIA) ICGA(AGS) NAJA
Professional Appraisals in Denver
this mae me think of something.. http://www.niceice.com/salestax.htm

is the link giving false info? Its true there is no sales tax here so I''m not obligated to pay no matter where I buy... but what about someone purchasing here from another state? I thought it was local to the SELLER but now you guys are saying local to the BUYER so wouldn''t the info todd put on his site above be.... wrong?
 

Cehrabehra

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Date: 2/5/2007 10:54:58 PM
Author: taman25thc02
Do they allow picking out the stone in person? This would seem to be almost like a store and create store overhead to factor into costs?
sorry the thread morphed - but good info!! anyway.. yes I would buy from wf and yes I would make an *appointment* (only by appt) to go in and get a tour and see some stones.... that is exactly what I would do if I lived anywhere near there.
 

Bunnifer

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Date: 2/5/2007 11:06:55 PM
Author: Cehrabehra
Date: 2/5/2007 10:59:48 PM

Author: denverappraiser


That is, of course, entirely up to you. We’re just pointing out that the $500 isn’t a savings granted by Whiteflash’s for their out of state customers, it’s called tax evasion. A lot of people do it, and a lot of people get away with it. The government’s irrelevance lasts only until the audit. Most taxpayers aren't audited very often so I suppose the risk is relatively low.

Again, here's the rules, straight from the Texas department of revenue.

http://www.window.state.tx.us/taxinfo/taxforms/01-156.pdf



Neil Beaty

GG(GIA) ICGA(AGS) NAJA

Professional Appraisals in Denver

this mae me think of something.. http://www.niceice.com/salestax.htm


is the link giving false info? Its true there is no sales tax here so I'm not obligated to pay no matter where I buy... but what about someone purchasing here from another state? I thought it was local to the SELLER but now you guys are saying local to the BUYER so wouldn't the info todd put on his site above be.... wrong?
The distinction to make is SALES TAX v. USE TAX. Sales tax is charged by the vendor, who is required to charge it for in-state purchases. Use tax is usually the responsibility of the purchaser to report it in his/her home state. It is not charged by the vendor.

ETA - sorry for the threadjack, OP.
 

denverappraiser

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