Sales tax can be a confusing subject for the consumer and the contractor in every state. Some products are taxable, while others aren’t and the same is said of services rendered. This article is an attempt to answer some of the most common questions. It is always recommended to verify these things with each State’s Department of Revenue or visit their website and see and look for Sales and Use Tax Information publications that can usually be downloaded.
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Unless there is a tax exemption in place for the buyer or consumer, retailers in each state are imposed with sales tax if they offer leases, license, rentals or provide retail salesof the following products:
- Tangible personal property
- Coins and stamps of the United States that are leased, licensed, rented, sold, or traded and considered to a collector’s items, when the item(s) are more than the face value.
- Tangible personal property that is leased when affixed to real property, provided if there is a breach or termination of the lease and the lessor has the right to remove the leased property.Exception to this would be when the lessor’s lease amount for said tangible personal property affixed to real property and the lessor also owns the real property that the leased property is affixed.
- Digital goods such as recorded music in the form of cassette tapes, CDs, electronically transferred music, and vinyl LPs.
There are certain services which are furnished, licensed, performed, or sold at retail in each state are typically subject to state sales or use tax, unless the buyer provides the service provider proof they are tax exempt for such transaction.
The Description Of Tangible Personal Property For Plumbing Services Purposes
Any item that can be felt, measured, seen, touched, weighed or any other methodthat is perceptible to the senses and is considered personal property is a tangible personal property.
Some examples of these categories include clothing, computers, electricity, gas, office equipment, steam, or water. Also included are any prewritten computer software that is delivered by a download, physical media, etc.
Taxable Plumbing ServicesFor Each State
With certain services being taxable that are furnished, performed, or sold, this includes plumbing services which are performed at or on personal property, commercial or private. Taxable services include:
Contractors, such as plumbers are taxed on labor, materials, and supplies when they are in the position of a retailer or are acting as a consumer. As a consumer, a contractor is not required to have a seller’s permit which includes when they are constructing, installing, repairing or servicing. This would include any plumbing services.
A plumbing contractor must pay sales or use tax on all equipment and tools they use for installation, repair, or service plumbing type activities. Again, a consumer or plumbing company should inquire with each State’s Department of Revenue to get additional and exact information. Or they can obtain the same information in publications that are typically available on each state’s website where it can be downloaded. This publication will have detailed Sales and Use Tax Information pertinent to each state accordingly and available to all parties of interest.
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