What's wrong with the tax exemption at GC?

[wesardis]

Hello, Central Harmonists.

 

I went into my usual Guitar Center the other day, and told them that I have a tax exemption (they've never had a problem with this in the past), and the clerk said that they're being :cop:audited:cop:, so they can't give me my tax exemption unless I show my (he spouted off 3 letters that I don't remember) every time I come in. (no, the three letters weren't A, S, S)

 

Anyway, I looked all over the web and can't find anything about it, except that in TX, as a record-producing musician, I'm entitled to a tax exemption. Does anyone have any information about what's going on?

Thanks in advance.

[Nijyo]

Hello, Central Harmonists. I went into my usual Guitar Center the other day, and told them that I have a tax exemption (they've never had a problem with this in the past), and the clerk said that they're being :cop:audited:cop:, so they can't give me my tax exemption unless I show my (he spouted off 3 letters that I don't remember) every time I come in. (no, the three letters weren't A, S, S) Anyway, I looked all over the web and can't find anything about it, except that in TX, as a record-producing musician, I'm entitled to a tax exemption. Does anyone have any information about what's going on? Thanks in advance.

 

Most tax exemptions I've seen require you to show the form that says you are such-and-such and the store will keep that on record. Keeps a random yahoo from coming in and claiming they have an exemption. You should be able to obtain one from the state gov't if you meet the criteria for the exemption.

[daddymack]

Here in CA typically you need a reseller's license #...I guess it varies state to state.

[Kramerguy]

Here in PA, you gotta show a tax exemption (business tax id) form. Under law, GC or any place else can make a copy and keep it on file so you don't have to produce it repeatedly, but anytime you go to a new place, you gotta bring it. Many places also refuse to copy it and make you bring it every time, because my understanding is that it's a buttload of paperwork after the fact, and accountants don't want to deal with it, especially in the bigger companies.. like GC...

[OldMattB]

I had never heard of this:

 

"A producer may claim 100 percent exemption from state and local sales and use taxes on qualifying machinery and equipment purchased, repaired, leased or rented and used directly in the production of audio recording masters. If the equipment is exempt, any parts, repair or maintenance labor is also exempt."

 

oldMattB

[Kramerguy]

Hello, Central Harmonists. I went into my usual Guitar Center the other day, and told them that I have a tax exemption (they've never had a problem with this in the past), and the clerk said that they're being :cop:audited:cop:, so they can't give me my tax exemption unless I show my (he spouted off 3 letters that I don't remember) every time I come in. (no, the three letters weren't A, S, S) Anyway, I looked all over the web and can't find anything about it, except that in TX, as a record-producing musician, I'm entitled to a tax exemption. Does anyone have any information about what's going on? Thanks in advance.

 

I just re-read this again and noticed something-

 

Did you mean to say that you would just waltz into GC and say "tax exempt" and they wouldn't charge you tax??? That's downright illegal, and might explain the audit...

 

So just in case.. you do know (and if not, consider this me telling you) that you need to have a business license (yes, even as an "artist") to get a TAX ID, which then can be used to make tax-exempt purchases..

 

I'm not a legal scholar, but I believe it's about the same in every state as the federal IRS guidelines do set the minimum requirements.

[wesardis]

 

I just re-read this again and noticed something- Did you mean to say that you would just waltz into GC and say "tax exempt" and they wouldn't charge you tax??? That's downright illegal, and might explain the audit... So just in case.. you do know (and if not, consider this me telling you) that you need to have a business license (yes, even as an "artist") to get a TAX ID, which then can be used to make tax-exempt purchases.. I'm not a legal scholar, but I believe it's about the same in every state as the federal IRS guidelines do set the minimum requirements.

 

 

Haha. They once had me fill out a form where I wrote down my tax ID, they put that on my file in their computer system. From then on, I could "waltz" into the store, tell them my name, they'd look up my file, then knock off the tax.

 

The exemption I'm talking about is for music/film producers. In TX, pretty much any equipment you use to produce a record that will be sold for profit is tax exempt.

[daddymack]

sounds like the cashier did not know how to look up your tax ID...

[Kramerguy]

 

sounds like the cashier did not know how to look up your tax ID...

 

 

nahh, they knew, just made a conscious decision to break balls... I worked for a retailer that kept it on file for years then one day the accountants decided they didn't want to deal with it anymore, so they had us break stones over it and try to avoid doing it at all.

 

And they wonder why wal-mart is taking over...

 

If you are going to get {censored}ty service, might as well go pay cheapest rate and accept the service is {censored}.

[Scafeets]

I magine the three letters were wither EIN (Employer Identification Number - which is the corporate equivalent of a SS number) or TES (Tax exempt Status) number which you would get from the state as a charity or educational institution.

If I were a retailer, I sure as hell wouldn't skip charging sales tax without documentation. The states create a ton of legal hassles and paperwork for tax cheats. OTOH, GC should be able to enter that info into their computer system.

[SBF3000]

GC has rarely been accused of having the brightest bulbs

[tim_7string]

My dad has this tax-exempt status through his work, although it is non-music related. He always gets a response in the form of a look of disgust, a loud sigh and a bit of grimace whenever he shows his card and tells them, "By the way, this is through the office and we are tax-exempt."

 

It doesn't surprise me that GC would act in this way, especially if they are being audited (in which case they have to more carefully scrutinize everything).

[jaytee123]

Call up GC, and have them tell you what those three letters are...then MAYBE we have heard of it.

[guitardude05]

i produce my own music and have it copyrighted, but it is not ready to be distributed yet... so i cant make profit yet. i am not a small business. can I get this tax exemption in Texas?

 

if not, when i register as a small business will i be able to be exempt? i would be the only employee...

 

a GC employee told me that the state of Texas is auditing "EVERYONE" who has tax exemption. this isnt possible is it? for everyone?

 

what would happen to someone who gets this tax exemption but then has no business and then gets audited? i know some musicians who do this...

[dgarman]

Okay, so here is what I know. Tax laws will always very from state to state, but with regard to PA, and my local GC in particular, this is the scoop. GC, and alot of other retialers in PA have been a bit lax with tax exept forms in the past, and now they are cracking down. People that have had tax exempt forms on file with GC will most certainly have to redo those forms at this point. GC can not provide you the forms, you must print them yourself, fill them out beforhand, and bring them in. In PA the forms you will need include somthing called a 1220, a copy of your tax exept certificate, and for purchases over $200, you will need a purchase order on the letter head of your organization, basicly stating what is being bought, for what price, where the funds are coming from, and who is autherized to use them. If your 1220 form doesn't have an experation date on it, it will be assumed to be good for 2 years.