mitzi Posted September 4, 2008 Report Share Posted September 4, 2008 Can any longarm quilter in Minnesota confirm for me whether we need to charge sales tax on our services. I am assuming yes, but I have so far been unable to locate anything that specifically says our services are a taxable service. Thank you. Link to comment Share on other sites More sharing options...
Judi Posted September 4, 2008 Report Share Posted September 4, 2008 Mitzi - Welcome to the Forum! Yes, we do. On everything, labor and batting and such..... mine is at only 6 1/2% in the small town I live in. But most of the others in towns around here are at 7 or 7 1/2%. Link to comment Share on other sites More sharing options...
elkayr Posted September 4, 2008 Report Share Posted September 4, 2008 I thought that quilting was a service & that sales tax was not charged on services. If you did not furnish any materials for the quilt and only did the actual quilting, would you still charge sales tax? I'm just curious! Link to comment Share on other sites More sharing options...
kimmiequilts Posted September 4, 2008 Report Share Posted September 4, 2008 I've been confused by the sales tax from the beginning of my business any information or help will be much appreciated! Link to comment Share on other sites More sharing options...
Gator Posted September 4, 2008 Report Share Posted September 4, 2008 Every state is different. Call you state tax office and talk to a human. Most of the info is on their websites but it usually reads in tax law format (confusing). Virginia doesn't require sales tax on the service but does on the materials, if bought wholesale. Link to comment Share on other sites More sharing options...
mrmquilt Posted September 4, 2008 Report Share Posted September 4, 2008 I'm in Ohio and my tax lady had me call the local tax office, I never did get him to understand what I was doing with quilting. He insisted it was similar to tailoring, sewing items together and then selling them. After going round and round I gave up and have to charge sales tax on my quilting service. I'd bet if I talked to 3 different tax people I'd get different answers. Don't you just "love" tax. Michele Link to comment Share on other sites More sharing options...
Bonnie Posted September 4, 2008 Report Share Posted September 4, 2008 Michele...you are so right....when I lived in Reno, they wanted me to tax on thread by the inch....NOW HOW THE HE** was I suppose to tax by the inch of thread..... When I finally convinced them that I was just a service shop...not selling or even wanting to purchase anything wholesale, just a service department only, then I was tax exempt for that....but if I had sold any battings or thread etc then I would have had to collect the tax. Link to comment Share on other sites More sharing options...
doodlebug Posted September 4, 2008 Report Share Posted September 4, 2008 tax thread by the inch, thats funny... my local government had a 'nice' little' law about small homw based business: i could have my machine in my house, but everything else, batting thread, customer's quilts, templates,etc, had to be stored off site. i don't think they (the government) understand what we do. i'm currently hooking up with a CPA who told me she'd help me get thru all the tax issues. (most CPA will give a free consultation) i've also learned that as long armers for hire , we are 'manufacturing for non resale' so that puts us in a different tax bracket (but *discliamer* you have to check your local laws on that). but i agree, talk to an actual person. all that legal-ize on websites is boring... Link to comment Share on other sites More sharing options...
mitzi Posted September 4, 2008 Author Report Share Posted September 4, 2008 Thank you all for your comments. I believe I will be charging 6.5% on my services and the sale of batting and thread - just will need to figure out what to do with it once I collect it. I will need to hire an accountant and trust they will know what to do. Thanks again! Link to comment Share on other sites More sharing options...
ffq-lar Posted September 4, 2008 Report Share Posted September 4, 2008 My business is considered "manufacturing" in my state--which a CPA advisor said is a good thing. State sales tax is collected on the entire invoice. We can get a "use tax" rebate yearly for any retail items purchased that we paid taxes on and that we then resell--like if I need a special batting from the LQS for a customer. That sales tax is rebated to me since she will also pay the same sales tax when she picks up. My first year the tax amounted to about $4 so it really isn't worth the effort for me to do the bookwork and fill out the extra forms for the rebate! Hope I didn't confuse the issue here--this is Washington only and you can get information and advice from your local government. Link to comment Share on other sites More sharing options...
Judi Posted September 4, 2008 Report Share Posted September 4, 2008 Mitzi - I will try and find the link I used for you. Have to dig in my folders..... You will need a tax i.d. # and such.... pay it in at the end of the year, or quaterly, or monthly.... what ever you chose to do and sign-up for....... I will send you an email, try for tonight yet! Link to comment Share on other sites More sharing options...
ramona-quilter Posted September 4, 2008 Report Share Posted September 4, 2008 Quilting is called "fabrication labor" in California. Because we create an article, it is assessed at the California State Tax rate which is 7.75%. When we get our business license, we have to list all the things that we plan to sell such as batting and thread and those are also taxed at 7.75%. So, like Linda R, the entire invoice is taxable. It's funny, though, quilt repair is not taxed, because it does not create anything, it just fixes it. Link to comment Share on other sites More sharing options...
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