Asixpercentuse tax may be due if you make out-of-state purchases for storage, use or other consumption in Kentucky and did not pay at least sixpercent state sales tax to the seller at the time of purchase.
For example, if you order from catalogs, make purchases through the Internet, or shop outside Kentucky for items such as clothing, shoes, jewelry, cleaning supplies, furniture, computer equipment, software, office supplies, books, souvenirs, exercise equipment or subscribe to magazines, you may owe use tax to Kentucky.
It is important to remember that use tax applies only to items purchased outside Kentucky, including another country, which would have been taxed if purchased in Kentucky.
In addition to the use tax line foundon theSales and Use Taxreturnsand the ConsumerUseTax returnfor businesses, the Department provides three additionaloptions for individuals to report their use tax.
- Consumer Use Tax Return - Form 51A113(O)may be filed during the year each time you make taxable purchases.
- You can report and pay use tax on an annual basis at the same time you file your Kentucky individual income tax return. Please see the Use Tax Look-Up Table information below.
- County Clerks verify payment of use tax on tangible personal property purchased out-of-state and offered for titling or first-time registration in Kentucky.
Use Tax Look-Up Table to Assist Taxpayers in Reporting Untaxed Retail Purchases
Recent statistics on retail sales confirm that more and more consumers have potential use tax liabilitythrough theincreased use of online shopping. Every year, internet sales continue to increase more rapidly than sales attraditional brick and mortar stores.
Kentucky consumers are required to report use tax on their individual income tax returns to accurately reflect their tax liability, and to ensure that our Kentucky-based retailers are not unfairly undercut by competing out-of-state retailers that fail to collect the tax on taxable products delivered into Kentucky.
When a web-based retailer or any out-of-state retailer does not collect the 6 percent Kentucky sales and use tax, the consumer is responsible for reporting and paying use tax on those untaxed purchases, in accordance withKRS 139.330. The easiest way for the individual consumer to report and pay the use tax is on the state income tax return.
The Look-Up Table provides an option to report estimated use tax owed on retail purchases based upon Kentucky adjusted gross income when salesreceipts are not readily available to calculate the actual unpaid use tax liability.
FAQs
In general, you owe California use tax when you purchase physical merchandise from out-of-state sellers for use, storage, or consumption in California.
What is the consumer use tax in California? ›
Consumer. The sales and use tax rate varies depending where the item is bought or will be used. A base sales and use tax rate of 7.25 percent is applied statewide. In addition to the statewide sales and use tax rate, some cities and counties have voter- or local government-approved district taxes.
What is exempt from California use tax? ›
Some common California use tax exemption items/situations are: Purchases made from a California seller: If you purchase goods or services from a California seller and pay sales tax at the time of purchase, you are generally not required to pay use tax on the purchase.
What is the collection allowance for sales and use tax in Florida? ›
When you electronically file and pay on time, you may take a collection allowance. Be sure to calculate it correctly. The collection allowance is 2.5% (.025) of the first $1,200 of tax due, not to exceed $30 for each reporting location.
What happens if I don't pay California use tax? ›
Levy your property, bank account, salary or wages. Lien your property. Revoke (suspend) your seller's permit. Operating without a seller's permit is illegal.
How much is the use tax in California? ›
The statewide tax rate is 7.25%. In most areas of California, local jurisdictions have added district taxes that increase the tax owed by a seller. Those district tax rates range from 0.10% to 1.50%. Some areas may have more than one district tax in effect.
Why do I owe California taxes? ›
Owing state taxes can result from personal changes, job transitions, side jobs, and eligibility for tax credits and deductions. It could also occur because you withheld too little for state taxes, or your earnings changed your entitlements to certain tax credits, such as the Earned Income Credit.
Why am I getting a letter from the California Department of Tax and Fee Administration? ›
Why did I receive this letter? Our records show that you have an outstanding balance. Additional interest will accrue if the tax and/or fee is not paid in full. Details of the balance due are shown on your letter.
Is use tax deductible on federal returns? ›
The Internal Revenue Service (IRS) permits you to write off either your state and local income tax or sales taxes when itemizing your deductions. People who live in a state that does not impose income taxes often benefit most from this deduction.
What is California use tax for vehicles? ›
How Much Does California Collect for Car Sales Tax? What does that California sales tax rate mean for customers seeking to purchase a vehicle in the state? If you buy a vehicle in California, you pay a 7.5 percent state sales tax rate regardless of the vehicle you buy.
There are 2 ways to get tax-exempt status in California:
- Exemption Application (Form 3500) Download the form. Determine your exemption type , complete, print, and mail your application. ...
- Submission of Exemption Request (Form 3500A) If you have a federal determination letter:
It could be one big change or several changes that made an impact: Filing changes – But big life changes, such as marriage, divorce, retirement or adding a dependent (having a baby, adopting) can affect the your tax situation such as the filing status for which you are eligible and other aspects of how you are taxed.
What state has no sales tax? ›
What states have no sales tax? There are five states with no general statewide sales tax: Alaska, Delaware, Montana, New Hampshire, and Oregon. These are sometimes referred to as the NOMAD states (“N” for New Hampshire, “O” for Oregon, and so forth).
What state has the lowest taxes? ›
- Alaska. #1 in Low Tax Burden. #45 in Best States Overall. ...
- Florida. #2 in Low Tax Burden. #9 in Best States Overall. ...
- South Dakota. #3 in Low Tax Burden. ...
- Wyoming. #4 in Low Tax Burden. ...
- Tennessee. #5 in Low Tax Burden. ...
- New Hampshire. #6 in Low Tax Burden. ...
- Texas. #7 in Low Tax Burden. ...
- Oklahoma. #8 in Low Tax Burden.
Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming are the only states that do not levy a state income tax. Note that Washington does levy a state capital gains tax on certain high earners.
What is the use tax in California DMV? ›
The use tax is based on the total purchase price of the vehicle or vessel. The total purchase price includes cash, the payment or assumption of a loan or debt, and the fair market value of any property and/or services traded or exchanged for the vehicle or vessel.
Do I owe CA income tax? ›
Who pays California state income tax? Generally, you have to file a California state tax return if you're a resident, part-year resident or nonresident and: You're required to file a federal tax return. You got income from a source in California during the tax year.
Why am I paying California tax? ›
State withholding is money that is withheld and sent to the State of California to pay California income taxes. It pays for state programs such as education, health and welfare, public safety, and the court justice system. California's elected representatives also meet every year to decide how this money will be spent.
What is California use tax line 91? ›
If the taxpayer enters zero on line 91, the taxpayer must check one of two boxes indicating that either the taxpayer owes no use tax or the taxpayer has remitted his or her use tax obligation for the taxable year directly to the California Department of Tax and Fee Administration (CDTFA).
