General Sales Tax
A tax levied when a good or applicable service is sold to its final customer
What is sales tax?
A person or entity that engages in retail sales in Indiana is registered as a....
What is a retail merchant?
A drink sold from a vending machine that is taxable.
What is a soft drink?
Up to 3 different people can answer.
2. Made a purchase online or out of state and 6% sales tax was collected. 1% use tax should be remitted.
3. Item was purchased sales tax exempt and then was used in the course of business and not put in inventory for resale.
Indiana's state bird.
What is the cardinal?
The length of time that a business should keep an exemption certificate that they received from a purchaser.
What is a minimum of 3 years from the end of the year that the items were purchased?
Example: Purchased in May 2023; keep until at least 12/31/2026.
Indiana has this nickname due to its extensive interstate highway system.
What is the Crossroads of America?
A contractor billing as time and materials basis should handle sales tax this way.
What is purchase materials tax exempt (issue exemption certificate) and collect sales tax from their customer on the materials only? They will not charge sales tax on the labor portion of the separately stated bill.
1. This person is responsible for paying the sales tax.
2. This person is responsible for remitting the tax to DOR.
Who are the purchaser, and the business owner?
The sales tax information bulletin number regarding vending machines.
What is #45?
Indiana's sales tax rate.
What is 7%?
This is imposed on transactions that would have been subject to sales tax, had it been an Indiana retail transaction.
What is Use tax?
Give an example of a sales tax exemption that is used to prevent tax pyramiding.
- sale for resale. retailer purchases items for resale.
Wholesaler to retailer - retailer to consumer.
Parke County, Indiana is home to more than 31 of these structures.
HINT: Made famous by _______
(an annual festival in the fall)
Use tax can be reported on this form. Name 2.
What is st103, st115, Indiana income tax return (individual, corporate, or partnership returns)?
Indiana's WNBA Team.
What is Fever?
Use tax and sales tax does not apply to non-retail transactions like a yard sale. This is referred to as what?
What is an occasional sale?
The sale of goods by a seller who delivers the goods directly to the purchaser's customer.
Bonus point: Drop shipments are taxable or not taxable?
A business collected sales tax on bottled water.
A. They should remit the tax to Indiana since bottled water is taxable.
B. Since water is not taxable, they should file a claim for refund for the sales tax.
C. They should remit the tax to Indiana since it was collected.
D. All of the above.
What is C?
Since they collected the tax from their customers, the business must remit the sales tax to DOR. They cannot file a claim for refund unless they can show that they refunded the money to their customers.
This famous musical group got its start in Gary, Indiana
What is the Jackson 5?
Using this type of contract, a contractor should pay sales tax to their supplier on their customer's materials.
Example: Fred's Construction is doing a job for Minnie's Muffins. Fred purchases lumber from Menards for the job. Under what type of contract/billing would Fred pay the sales tax directly to Menards?
What is a lump sum contract?
When a contractor issues a lump sum contract that includes the total price together for labor and materials, no sales tax is collected from their customer. The contractor will pay sales tax on the materials when purchasing the items.
A retailer paid 7% sales tax to the wholesaler at the time they purchased a product. They should collect and remit sales tax on what portion of the product when they resell it?
What is 7% of the selling price?
They must collect the sales tax on the full sales price. The business should issue an exemption certificate to the wholesaler and not pay sales tax at the time of their purchase. The business can file a claim for refund for the sales tax paid to the wholesaler.
The threshhold that a remote seller is required to collect and remit Indiana sales tax as a retail merchant.
What is gross revenue that exceeds $100,000 in the current or preceding calendar year?
Each transaction in a string of transactions must be evaluated independently to determine taxability.
A contractor will be completing a lump sum contract of permanent construction work for a not for profit entity. How should sales tax be handled?
(You do not need to phrase in form of a question)
Since the ultimate purchaser/recipient of the materials could have purchased the materials exempt, the contractor may purchase the materials exempt. (Note only items that will be incorporated into real property).
Transaction 1: Contractor issues exemption certificate from themselves to the materials company(Menards).
Transaction 2: NFP issues NP-1 to the contractor.