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Sales tax recovery (CA)

August 15, 2018, 06:16:02 pm

I received a cover letter from Racor in Kentucky, where I bought my transmission oil cooler via the internet.  They informed me that the CA Department of Tax and Fee Administration is examining their records in connect with California Sales and Use Tax Law.  They forwarded a form that I need to fill out regarding "disposition" of the item and what taxes I paid.  This is to be done within 10 days and I should "cc" to Racor to show that I complied.
This is an interesting turn; has anyone else encountered this?  Hope they don't find out about my radiator.

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Re: Sales tax recovery (CA)

Reply #1 – August 15, 2018, 06:40:49 pm

Sure it's not a scam?

If Racor has dealers in California, they are required to charge you sales tax. I bought a radio in Dallas for about $2000 but since they had an office building in S.Cal, I had to pay sales tax.

Now, the county comes around to airports at tax time to see if any planes have come from out of state. They then contact the Franchise Tax Board and you get a sales tax bill. Use to be you could purchase an RV out of state, store it there for several months, bring in into the state and register it without taxes.

I got them back years ago with a new car purchase in Germany in my in-laws name. They never registered it when it arrived but gifted it to me. No TAX and legal! That also worked for one time EPA exemptions.

Pierce

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Re: Sales tax recovery (CA)

Reply #2 – August 15, 2018, 07:42:43 pm

Not a scam - I trust the sender (Rocore) and the form is legitimate.  I also checked on line.  They do split some hairs with regard to shipping and handling, which, surprisingly, "can" be taxable.  Lastly, the form had a ca.gov email address.  They asked for no money, but I'm expecting to hear from them. 

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Re: Sales tax recovery (CA)

Reply #3 – August 15, 2018, 09:18:17 pm

The out of stare delivery and a following use period to not owe ca sales tax was 90 days long ago.  Now one year.

Only way I can figure how ca queried Rocore would have been the Bill of Lading?  Does not sound right. 

Ca monitoring all truck shipments to private individuals? 

Ca has any  authority in Kentucky?  But ca is broke? 

Ca office?

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Re: Sales tax recovery (CA)

Reply #4 – August 15, 2018, 09:38:04 pm

It is my belief all states charging sales tax, are attempting to collect sales tax on shipments from out of state, if that company has an office in their state. 
"Parker-Hannifin Racor Division
3.0
6 Google reviews
Manufacturer in Stanislaus County, California
Address: 3400 Finch Rd, Modesto, CA 95354
Phone: (209) 521-7860"

You might call them to see if they still have an office at both the number you bought the product from and the above phone number from google.  Good luck.  I know some companies vary their sales tax collection depending on if you pick up the product in their state or they ship to you.  This has been a hot topic with both eBay and Amazon.  Thanks for the post, as this could be important to any forum member ordering parts from CA. if that company has an office in their state.

If the mfg is being audited, the mfg may have a huge tax bill ahead.

For the best information, I have always referred residents of CA to:  Board of Equalization – State of California

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Re: Sales tax recovery (CA)

Reply #5 – August 15, 2018, 11:26:42 pm

If you buy something out of state, you are still liable for the state Sales and Use tax. The shipper is liable to collect if they have standing in the state. More states are pursuing sales tax.  If they had another reason to be investigating Racor, they likely demanded all shipping info for items sent to state.

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Re: Sales tax recovery (CA)

Reply #6 – August 16, 2018, 10:32:48 am

More and more states make almost any seller shipping to that state liable for collecting that states sales and use taxes and filing returns and paying those taxes to that state.  It sure makes doing business more complicated.

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Re: Sales tax recovery (CA)

Reply #7 – August 16, 2018, 11:11:27 am

Yes, Racor is real and in Modesto, CA.  My father use to be plant manager at the manufacturing facility years ago.  Below is an advisement for CA residents making internet purchases from the California Franchise Tax Board:

"For consumers that order tax-free items online, but live outside states that charge a sales tax, they are required to report that purchase to the state tax agency and pay the sales tax directly to the agency".

When consumers are required to do so, it is often called a "use" tax.  The sole difference between a sales tax and a use tax is the person that ends up giving the money to the state government. When it is a sales tax, the retailer is the one handing over the money, while a use tax is handed over directly by the consumer. However, collecting use taxes on small purchases often costs more than simply letting the consumer not pay the use tax. Instead, state tax agencies try to focus more on collecting use taxes for big ticket items that are purchased online with no sales tax, such as cars and boats.

Be aware, there are a number of states that have stepped up their enforcement of their use tax laws and are now trying to make their state residents pay the taxes that should be paid.

California has become very aggressive in tax collection.  Even going through RV parks looking for out of state licensed RV's that have California plated vehicles associated with it, such as the Towed vehicle as an example.

Just saying, be aware that it is happening and out there.

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Re: Sales tax recovery (CA)

Reply #8 – August 16, 2018, 01:16:44 pm

Steve is correct. What probably triggered it is CA does audit of major vendors sales to CA, and then CA goes after CA residents to be sure they volunteered paying sales tax due on CA State Income Tax form.

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Re: Sales tax recovery (CA)

Reply #9 – August 16, 2018, 06:20:29 pm

Another way to look at it:  A business in California (in my case) is at a disadvantage if I buy outside the state and pay no sales tax.  Regarding RVs registered in a different state, I see a lot of Montana plates on California RVs.  Is Montana cheating California?  It will be interesting to see how that plays out.

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Re: Sales tax recovery (CA)

Reply #10 – August 16, 2018, 07:12:36 pm

Maybe a less than load trucker on your order could have picked up your unknown large box at Racor for shipment. 

Not shipped by Racor directly?

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Re: Sales tax recovery (CA)

Reply #11 – August 19, 2018, 08:44:18 pm

The US Supreme Court recently ruled that States with sales tax CAN collect the sales tax from ALL businesses that sell to residents of that State, regardless of whether the business has an actual location within the State. Prior to that ruling, a business had to have a physical presence in a State in order for it to be required to collect sales tax. That changed this summer.

I guess the trick now would be to have items sent to you when you are in a State with no sales tax.

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Re: Sales tax recovery (CA)

Reply #12 – August 19, 2018, 11:49:15 pm

Or just pay the tax and hope your state benefits, what comes around goes around, no free lunches anymore. support a local business and local services, they may still remain available. This is NOT political statement by any means it's just long term Realtality. And that's what matters most for the future. Just my 2 cents.

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Re: Sales tax recovery (CA)

Reply #13 – August 20, 2018, 09:53:40 pm

True. While Amazon is helpful for some things, we often find ourselves needing something that can easily be purchased locally. We pay whatever sales tax is charged. Sometimes we are in a place long enough, and Amazon is cheap enough, that it makes sense to buy that way. Most of the time, though, I can get what I want at a local store - even if it is a national chain. Also, that way I know exactly what I'm getting, and if there is a problem I can go back and get it taken care of right away.

The exception was the purchase of our "new" towed. We were in Tennessee when the Jeep started showing signs that it was soon going to be expensive to own, so we traded it off. Since we are South Dakota residents that meant that we had to license the car in SD and pay SD sales tax. Tennessee's sales tax rate is nearly double that of South Dakota, so we explained to the dealer that we didn't want to pay TN sales tax and then file a claim to get it back AND pay SD sales tax. They made some phone calls and figured it out.

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