Roofers Charging Sales Tax

Natty, I have no idea what your example has to do with the conversation.

To make my post clearer. If you sell material to the customer, like a Lowe's and also install the product you need to charge sales tax on both.

If you do not sell materials, just supply them, you do not have to charge sales tax.

Lefty Said:

If you charge sales tax on one thing you have to charge it on everything. Never connect a storefront with you construction business.

This does not make sense. I have encountered sales tax collection on things that are not taxed under the law but I had to set them straight. For instance, if I buy a loaf of bread from the grocery store there is no tax. But if I buy it from the convenience store, they tried to tax it. No way- it was just a lazy convenience store owner.

Just because you have a store front doesn't make you liable. The tax is on the thing.

Yes - Please explain

twill59 Said: I was audited and warned once before. The solution turned out to be: be very careful how you word your invoices and try not to mention materials at all.

Please explain because this sounds like "creative accounting" for the purpose of tax fraud. What is the law where you do business?

Roofguy Said:

What gives?

In Texas, all construction is divided between residential and commercial. If you do any commercial work, you must get a sales tax license because the final cost of the project is charged a sales tax -both material and labor. You can either give your material supplier your license number and they will not collect a sales tax on your material then you must collect all of the tax from the property owner, or you can let the material supplier collect the sales tax on the material then you only collect tax on the balance of the contract price.

On residential work, the sales tax is collected only on the material which you can collect or you can just pay it to the material supplier.

What gives is there are an awful lot of tax cheats out there and only a matter of time until they are caught.

It should be strongly noted that this is something that varies mucho from state to state

I was audited and warned once before. The solution turned out to be: be very careful how you word your invoices and try not to mention materials at all.

Its da gooberm $ nt.......what do ya expect?

We do not have to charge sales tax on labor for construction. Places like Sears, Lowes, Home Depot... have to charge sales tax because they also sell materials. A company like mine only supplys materials.

If you charge sales tax on one thing you have to charge it on everything. Never connect a storefront with you construction business.