In Case You Missed It: Last Week in Allyn Tax News (November 1-5)

Posted on November 08, 2021

North Dakota Local Sales and Use Tax Rate Change

Active January 1, 2022, the city of Richardton is increasing its sales, use and gross receipts tax by 0.5% and removing the $100 per sale maximum tax ceiling. This increase brings the tax rate to a total of 2.5%. There are no added exemptions and contracts bid before January 1, 2022 are excluded from this rate increase.

 

Leases of Buried Dark Fiber Optic Cable In North Carolina: Taxable or Exempt?

North Carolina Department of Revenue has issued a private letter ruling to a taxpayer in regard to the leasing of buried dark fiber optic cable. The taxpayer owns and maintains a fiber optic cable network. Once the cable is buried it is not removed for any reason since attempting to remove it would damage the cable and cost more than the cable is worth. If there is an issue with the cable a new one is laid and the other abandoned. Due to this nature the Department decided that the buried cable would be considered a leasing of real property since it cannot be removed from the land once installed. Real property leases are not subject to sales tax in North Carolina.

 

Kentucky Landscaping Services Sales & Use Regulation Finalized

The Kentucky Department of Revenue has finalized a regulation dealing with the treatment of sales and use tax to landscaping services that was set in place October 5th, 2021. The regulation enforces that a person performing landscaping services is not eligible to issue a resale certificate for property used or consumed in the service. Examples of this property include chemical applicators, equipment rentals, gasoline, gloves, lawnmowers, oil, wheelbarrows, and trimmers. This regulation also states that examples of taxable landscaping services include aerating; chemical use in lakes or ponds to limit the growth of algae or plant life; the clearing of trees or bushes; fertilizing; installation of decorative bricks, blocks, and timbers; leaf removal; lawn treatments; mowing and trimming; planting trees and shrubs; seeding or reseeding; and services for the removal of lawn pests.

 

Connecticut’s Tax Amnesty Program

Connecticut’s tax amnesty program began November 1, 2021 and will run through January 31, 2022. This program gives businesses and individuals the opportunity to pay back taxes owed at a reduced interest rate with no penalties or criminal prosecution. All state taxes are eligible for this program expect Connecticut’s motor carrier road tax. The tax amnesty will cover taxable periods ending on or before December 30, 2020.

 

Tax License Renewals in Alabama

Alabama’s Department of Revenue has issued a reminder to businesses to renew their annual tax account licenses. Licenses that require annual renewal are sales tax, rental tax, sellers use tax, lodgings, tax, utility gross receipts tax, and simplified sellers use tax. If a license is not renewed, the tax account license previously issued will be cancelled and the business will no longer be allowed to use the tax license to make tax-exempt purchases for resale or rental purposes.

 

Kansas Local Sales and Use Tax Rate Changes for 2022 First Quarter

The Kansas state and local sales and use tax rates will change in Finney, Ford, Gray, and Hodgeman Counties on January 1, 2022. Finney County will decrease its rate to 1.3%, and its combined state and local sales and use tax rate will be decreased to 7.8%. Ford, Gray and Hodgeman Counties will decrease their rates to 1% and they will decrease their combined state and local sales and use tax rates to 7.5%. Liberal, Overland Park, and Parsons city will have new districts set up in them. A district has been dismissed in Goodland.

 

Kansas Provides Guidelines for Marketplace Facilitators for the Collection, Remittance and Registration for Sales and Use Tax

Kansas Department of Revenue has published guidelines that state that an entity may be considered both a marketplace facilitator as well as a direct seller. When the entity is acting as a marketplace facilitator, it is under the provisions of Sections 1 through 4 of Senate Bill 50. This occurs when either physical or economic nexus is established. The thresholds for these statuses are sales above $100,000 or when 200 transactions take place. When the entity is acting as a direct seller, it is under the provisions of traditional sales tax law.

 

Exemption Certificate Management

Generally speaking, sellers are required to charge sales tax on all transactions of taxable products or services, however, there are some exceptions. Some of the more common exceptions are when sales are made directly to the Federal Government, if the buyer intends to resell the item in question, or if it will become a part of a manufactured final product.

Having dedicated exemption certificate management (ECM) software can make the whole process virtually painless. In most cases good ECM software can safely store your certificates, keep track of expiration dates, and provide an effective way to locate exemption certificates in case they are requested.

 

Rental Equipment with Operators in PA: Taxable or Exempt?

The Pennsylvania Department of Revenue (“Department”) issued a bulletin to inform taxpayers engaged in the rental of equipment and equipment with operators, including but not limited to cranes, concrete pumping and excavating, of the taxation of such transactions. When vendors furnish the equipment with the services of their operator, it is presumed that the transaction involves a transfer of the right to use or direct the use of the equipment. In this instance, the vendor of the equipment is providing a taxable rental of tangible personal property. This presumption may be rebutted by establishing that the work to be accomplished is exclusively under the control of the vendor who furnished the equipment and its operator. In this instance, the vendor of the equipment is providing a nontaxable service. When vendors furnish equipment without the services of their operator, the transaction is subject to tax as a rental of tangible personal property. 

 

How Can We Help?

Allyn’s tax team is staffed with seasoned tax professionals experienced in all aspects of Federal, multi-state and local tax compliance and consulting for large US and global corporations. We use that experience to your advantage.

Here at Allyn, we pride ourselves on our ability to always “stay on top of it”. We use the latest in tax software and create a unique, rigorous process for each and every client’s needs, ensuring that nothing slips through the cracks. Our team is equipped to assess in-advance and quickly resolve all tax issues that a business may encounter, allowing our clients to confidently focus on what they do best.

Allyn Tax offers a full scope of corporate tax services across North America, encompassing business tax compliance and consulting, audit defense and support, nexus reviews and registrations, exemption certificate management, overpayment reviews, and mail processing solutions.

Contact us and we can provide a customized cost-effective solution to meet your company’s needs. For further information on Allyn Tax services, please contact: tax@allynintl.com.

 

For More Information

If you are interested in learning more about this topic or other tax topics, please visit our Tax Publications under News & Publications at www.allynintl.com.

 

Contributor: Courtney Sboro


About Allyn International

Allyn International is dedicated to providing high quality, customer centric services and solutions for the global marketplace. Allyn's core products include transportation management, logistics sourcing, freight forwarding, supply chain consulting, tax management and global trade compliance. Allyn clients range from small local businesses to Fortune 500 firms. Allyn conducts business in more than 20 languages and has extensive experience in both developed and emerging markets. Highly trained experts are positioned throughout North and South America, Europe and Asia. Allyn’s regional headquarters are strategically located in Fort Myers, Florida, U.S.A., Shanghai, P.R. China, Prague, Czech