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View Full Version : Sales Tax vs. Personal Property Tax


milkmania
02-26-2006, 12:20 PM
Ok,
it's been established, I live in Oklahoma.:o

But, I also live 15 minutes from Ft. Smith, Arkansas. I shop a lot in Ft. Smith, simply because it's the biggest town around here.

The $39.995 X-1 thread made me think of this.
When I bought my Polaris 4-wheeler from a dealer I didn't pay sales tax, because Arkansans pay personal property tax. In other words they keep paying tax on that 4-wheeler (I'm not sure how long). I questioned the salesman and he said I would be paying personal property tax in the state I reside in. He knew full well that Oklahoma doesn't pay personal property tax, because he told me with a grin that I'd be getting out of sales tax and PP tax.

Then I got in the same deal with getting a quote for a John Deere tractor. The Ag Dealer wrote out the quote, left out sales tax, and said as long as I signed on the delivery document that the tractor would reside in Oklahoma, I'd not have to pay sales tax or PP tax.

found Hot Tubs & Carpet to be in the same boat.

Although probably unethical (in the states eyes), what would keep a customer from traveling to a state like Arkansas and doing the same thing?

Sodar
02-26-2006, 12:36 PM
Wow, that is one heck of a deal. If I could do that I would be saving approximately 8% on my purchases. That is a huge amount when you are talking about large purchases like cars, boats and tractors! Very cool Milk!

ski_king
02-26-2006, 12:57 PM
I think you will have to pay sales tax on anything you buy out of state such as car, boat, etc when you register it in your state.

Anything like a tractor or whatever does not require state registration is different.

I was about to buy all my appliences and furniture from a store across the border in Ohio a few years ago because they didnt have to charge sales tax if they delivered out of state. Then PA and OH closed the loop hole. :mad:

I also bought waterski equipment from a start up operation in Ohio and they didnt charge me sales tax, but they wrote it up as if they shipped it to me. That loop hole was closed also. :mad:

bigmac
02-26-2006, 01:10 PM
Ok,
it's been established, I live in Oklahoma.:o

But, I also live 15 minutes from Ft. Smith, Arkansas. I shop a lot in Ft. Smith, simply because it's the biggest town around here.

The $39.995 X-1 thread made me think of this.
When I bought my Polaris 4-wheeler from a dealer I didn't pay sales tax, because Arkansans pay personal property tax. In other words they keep paying tax on that 4-wheeler (I'm not sure how long). I questioned the salesman and he said I would be paying personal property tax in the state I reside in. He knew full well that Oklahoma doesn't pay personal property tax, because he told me with a grin that I'd be getting out of sales tax and PP tax.

Then I got in the same deal with getting a quote for a John Deere tractor. The Ag Dealer wrote out the quote, left out sales tax, and said as long as I signed on the delivery document that the tractor would reside in Oklahoma, I'd not have to pay sales tax or PP tax.

found Hot Tubs & Carpet to be in the same boat.

Although probably unethical (in the states eyes), what would keep a customer from traveling to a state like Arkansas and doing the same thing?
Unethical is one thing, but I'd be more concerned about the fact that it's illegal. Like most states, Oklahoma has a Use Tax which requires paying the sales tax on an item purchased anywhere if it's going to be used and stored in Oklahoma (stored in OK but not used there is different). The law requires that Oklahoma vendors have to collect the sales tax at the point of sale, but that's not true of non-Oklahoma vendors. Nevertheless, just because an out-of-state vendor doesn't COLLECT the sales tax, it doesn't relieve the purchaser of the legal obligation to pay it.

Now, having said that, the enforcability is another issue and the extent to which those things are enforced varies from state to state. Online purchases from out-of-state vendors is a typical example. The vendor isn't responsible for collecting the sales tax, but the buyer is responsible for declaring it on their income tax or filling out a form and sending it to the state at the time of purchase. Many (most?) states have no practical means of enforcing these things, especially for those online sales. However, when we're talking about a $350 camera from B&H Photo in New York, that's one thing. A $5000 off-road vehicle is another and I'd look into it further in your particular state.

bucky
02-26-2006, 01:58 PM
So far, I buy almost anything you can't get at wal-mart in Arkansas, Texas, or the internet (also no tax on unprepared food items in Texas). If it's not a car, truck, or boat, it doesn't need a title in Oklahoma, and they already get about 4% of my gross income right off the top, so screw them.8p

milkmania
02-26-2006, 03:38 PM
thanks for the replies....

I neglected to mention that the 4-wheeler I did buy was 6 months old (used). but, it was from a dealer. But, when I checked on a new one months later and a different salesman, he also indicated not to pay sales tax.

Also as mentioned above, we do have to pay tax when we purchase a travel trailer, boat, vehicle, and such that is tagged at the tag agency.

Ft. Smith's sales tax is 9.25%

also, my utility trailer was not registered (not needed) but also I bought it used, and don't need to go through the tag agency.

I'm going to check into the Oklahoma "use tax" and see how bad I'm screwing up:(

milkmania
02-26-2006, 03:43 PM
Unethical is one thing, but I'd be more concerned about the fact that it's illegal. Like most states, Oklahoma has a Use Tax which requires paying the sales tax on an item purchased anywhere if it's going to be used and stored in Oklahoma (stored in OK but not used there is different). The law requires that Oklahoma vendors have to collect the sales tax at the point of sale, but that's not true of non-Oklahoma vendors. Nevertheless, just because an out-of-state vendor doesn't COLLECT the sales tax, it doesn't relieve the purchaser of the legal obligation to pay it.

Now, having said that, the enforcability is another issue and the extent to which those things are enforced varies from state to state. Online purchases from out-of-state vendors is a typical example. The vendor isn't responsible for collecting the sales tax, but the buyer is responsible for declaring it on their income tax or filling out a form and sending it to the state at the time of purchase. Many (most?) states have no practical means of enforcing these things, especially for those online sales. However, when we're talking about a $350 camera from B&H Photo in New York, that's one thing. A $5000 off-road vehicle is another and I'd look into it further in your particular state.


very accurate and knowledgable assessment

thanks:)

twieder
02-26-2006, 03:54 PM
When I bought my boat, I had to pay Indiana sales tax. when I registered it in Ohio, I had to provide a tax statement from Indiana that showed the ammount paid. Since there was a 1/2% differance ( In. was lower) I had to pay that in Ohio.

I know Ohio is trying to figure a way to tax internet sales by tracking what comes into the state and making the buyer pay. Last fall, there was a big bust on people who buy cigs and other tobacco products to collect the taxes on those!

milkmania
02-26-2006, 04:00 PM
When I bought my boat, I had to pay Indiana sales tax. when I registered it in Ohio, I had to provide a tax statement from Indiana that showed the ammount paid. Since there was a 1/2% differance ( In. was lower) I had to pay that in Ohio.

I know Ohio is trying to figure a way to tax internet sales by tracking what comes into the state and making the buyer pay. Last fall, there was a big bust on people who buy cigs and other tobacco products to collect the taxes on those!

check this

In Oklahoma when I bought my boat (from Arkansas) I registered and paid tax on the boat only... (agency verified HIN) they don't consider trailers in Oklahoma. Travel Trailers are a different story.

twieder
02-26-2006, 04:10 PM
Ohio doesn't title trailers up to a certain weight unless used commertialy. Of course you have to get it weighed (empty) and register it. Cost varies depending on weight.

They took everything on the word of the dealership and their paperwork. I didn't have to get the boat or trailer inspected.

Workin' 4 Toys
02-26-2006, 04:33 PM
I know some folks that play this same strategy with the Indiana/Illinois taxes. I do think they just changed the rules in the last year or two. When I bought my car hauler about 3 years ago, I bought it in Ind. and the dealer just had me sign a document saying I would pay my own taxes in IL. (Would I have if I didn't need plates:rolleyes: , sure) I did.
When it comes to counties here, it is hard to get anything by anyone. I bought my boat in IL. and paid the dealer sales tax for my county. They figured wrong by about 0.75 of 1% for some reason, and my county came looking for it from me before they sent me the reg.

6ballsisall
02-26-2006, 06:12 PM
I got an irratating letter from the state of Kentucky saying I owe them property tax for the year on my Dodge Ram (which I sold in July of 2004.) Apparently since it was registered on Jan. 1 in their state (we rented for 4 months when we relocated here before we bought) I owe them $352.00..... The truck was registered in KY from Jan 1, 2004 til March 26, 2004 but they told me tough sh&&, pay us for the whole year. :mad: I love how they waited til now to let me know I need to pay this on a vehicle I haven't owned for almost 2 years. :mad:

milkmania
02-28-2006, 10:35 AM
had a meeting last night for baseball signups and was talking to a steel building manufacturer....
He's building his new office, and he was telling me the floor coverings (from Arkansas) were going to be tax free, because even though his sub-contractors were going to pick all of it up.... the salesman was going to note on the receipt that it was delivered.


Vinyl, Tile, & Carpet!:eek:

richardsoncd
02-28-2006, 10:58 AM
I bought my truck in South Carolina, they have the same deal I think I only paid $300 in tax (property tax) instead of the $1,000+ sales tax I would have paid in Georgia. The only GA tax I paid was for my tag....I figure they get enough out of my paycheck each month, I will probably always buy my vehicles in SC, it doesn't save a bunch...but it saves enough.