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New York Use Tax

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Question
New York Use Tax

Answer

You owe sales or compensating use tax if you:

  • purchased an item or service subject to tax that is delivered to you in New York State without payment of New York State and local tax to the seller; or
    • purchased an item or service outside New York State that is subject to tax in New York State (and you were a resident of New York State at the time of purchase) with subsequent use in New York State.

Note: You may be entitled to a credit for sales tax paid to another state. See the exact calculation method in the instructions for Form ST-140, Individual Purchaser’s Annual Report of Sales and Use Tax. For sales and use tax purposes, a resident includes persons who have a permanent place of abode in the state. Accordingly, you may be a resident for sales tax purposes even though you may not be a resident for income tax purposes. See the instructions
for Form ST-140 for more information.


You may not use this line to report:

  • any sales and use tax on business purchases if the business is registered for sales and use tax purposes. You must report this
    tax on the business’s sales tax return.
  • any unpaid sales and use tax on motor vehicles, trailers, all-terrain vehicles, vessels, or snowmobiles. This tax is paid directly to the Department of Motor Vehicles ( DMV ). If you will not be registering or titling it at the DMV, you should remit the tax directly to the Tax Department using Form ST-130, Business Purchaser’s Report of Sales and Use Tax, or Form ST-140.


An unpaid sales or use tax liability commonly arises if you made purchases through the Internet, by catalog, from television shopping channels, or on an Indian reservation, or if you purchased items or services subject to tax in another state and brought them back to New York for use here.

Example 1: You purchased a computer over the Internet that was delivered to your house in Monroe County, New York, from an out-of-state company and did not pay sales tax to that company.

Example 2: You purchased a book on a trip to New Hampshire that you brought back to your residence in Nassau County, New York, for use there.
You may also owe an additional local tax if you use property or services in another locality in New York State, other than the locality to which you paid tax. You owe use tax to the second locality if you were a resident of that locality at the time of the purchase and its rate of tax is higher than the rate of tax originally paid.


Failure to pay sales or use tax may result in the imposition of penalty and interest. The Tax Department conducts routine audits based on information received from third parties, including the U.S. Customs Service and other states. If you owe sales or use tax, you may report the amount you owe on your personal income tax return rather than filing Form ST-140

.
Using the sales and use tax chart below is an easy way to compute your liability for all your purchases of items or services costing less than $1,000 each (excluding shipping and handling) that are not related to a business, rental real estate, or royalty activities. You must use Form ST-140 to calculate your sales and use tax liability to be reported on this return if any of the following apply:

  • You prefer to calculate the exact amount of sales and use tax due.
  • You owe sales or use tax on an item or service costing $1,000 or more (excluding shipping and handling).
  • You owe sales or use tax for purchases related to a business not registered for sales tax purposes, rental real estate, or royalty activities.

Include the amount from Form ST-140, line 4, on Form IT-203, line 56. Do not submit Form ST-140 with your return. If the amount reported on line 56 is $1,700 or more, you must complete Form IT-135, Sales and Use Tax Report for Purchases of Items and Services Costing $25,000 or More, and submit it
with your return. If you do not owe any sales or use tax, you must enter 0 on line 56. Do not leave line 56 blank. For additional information on when you may owe sales or use tax to New York, see TB-ST-913, Use Tax for Individuals (including Estates and Trusts). For more information on taxable and exempt goods and services, see TB-ST-740, Quick Reference Guide for Taxable and Exempt Property and Services.


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Article Details
Views: 938 Created on: Jun 15, 2013
Date updated: Aug 24, 2015
Posted in: STATES, New York

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