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Texas Sales and Use Tax Return Form 01-922 – Help?
I’m filing a Texas Sales and Use Tax Return 01-922 for my interior design business and I am having trouble figuring out what goes in the TOTAL SALES, TAXABLE SALES, and TAXABLE PURCHASES fields. I paid tax on all but two things, one of which was used in a client’s home and the other was used in my showroom. I am assuming that one is going to be a sale and one is going to be a purchase, since I sold the one item to a client and purchased the other for my showroom. Any kind of clarification on this would be greatly appreciated. Thanks in advance!
This is from the state comptrollers website…
1. What “purchases” are subject to use tax?
A purchase may be subject to use tax for a number of reasons. The most common reasons are:
You used property purchased with a resale certificate. If you use a resale certificate to purchase merchandise that you intend to resell, your supplier will not collect sales tax. However, if you use the merchandise for another purpose before you resell it, you are liable for use tax. (Using merchandise for display or demonstration purposes before the property is sold is not subject to use tax. But, providing free samples to customers is a use and you would owe tax on the amount you paid for the samples.)
You used property purchased with an exemption certificate. If you use an exemption certificate to purchase taxable items, your supplier will not collect sales tax. However, if you use the merchandise or service for a non-exempt purpose, you are liable for use tax. (Purchasing manufacturing equipment but using it to perform contractor work is a non-exempt use.
You used property purchased from an out-of-state retailer. In general, if you purchase a taxable item from an out-of-state retailer without paying Texas tax and use the property in Texas the purchase is subject to use tax and must be reported. If you paid Texas use tax to such a retailer, you are not required to report the tax. That retailer must provide you with a receipt showing, among other things, the amount of use tax collected. You should retain a copy of the receipt showing you paid Texas tax.
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