Greenleaf Accounting

Virtual Bookkeeping & Accounting Services

(814) 450-0072
  • Email
  • LinkedIn
  • RSS
  • Twitter
  • Home
  • Services
  • About
  • Testimonials
  • Blog
  • Contact

What is Use Tax?

August 20, 2009 by Deb Howard Greenleaf

So what is use tax … and are you supposed to be paying it?!?

A use tax is a type of excise tax which is basically the flip side of sales tax. Here in Pennsylvania, if I buy $100 worth of office supplies at the local Staples, I’ll pay $6 (or 6%) in sales tax, for a total of $106. If I buy those same supplies online from an internet store, however, there is a chance that they won’t charge me any sales tax. In this circumstance, the Commonwealth of Pennsylvania expects me to pay that $6 to them anyway. When it is turned over by the purchaser instead of the retailer, that $6 is termed “use tax” — a tax on the use or consumption of goods that should have had sales tax charged on them.

As a business owner, you should review each of your purchases and see if you might have a use tax liability.  Several states are increasing their enforcement efforts and auditing business which they suspect might be dodging their use tax liability.  Here in Pennsylvania, a use tax audit that turns up unpaid taxes will result in penalties and interest that could exceed 30% of the tax due PLUS the unpaid tax!

To find out if your home state expects you to be turning over use tax, check out the handy map at SalesAndUseTax.com.

Deb Howard Greenleaf
Deb Howard Greenleaf

Deb Howard Greenleaf, EA, CEO and Principal, of Greenleaf Accounting Services provides virtual accounting and bookkeeping services and specializes in financial management to consultants, coaches, solo professionals, and other small business owners across the US. Deb is an Enrolled Agent (EA)—an IRS-licensed tax professional—and specializes in small businesses and entrepreneurs filing Schedule C or as an LLC. As an Advanced Certified QuickBooks ProAdvisor, Deb spends her day in QuickBooks Online and specializes in providing QBO support.

Related posts:

Default ThumbnailWhat's Your Audit Risk? Default ThumbnailUncle Sam Wants your QB File! Default ThumbnailClosing Out The Books for 2010 Default ThumbnailCut Your Small-Biz Taxes Before Its Too Late!

Filed Under: Small Biz Taxes

Free 1099 Success Cheat Sheet

Want to be ready for 1099s at year end? Learn how with my 1099 cheat sheet.

Browse by Topic

  • 1099 Reporting
  • Best Practices
  • Bookkeeping
  • Greenleaf Accounting
  • New Business
  • Quotations
  • Small Biz Taxes

Recent Posts

5 Best Practices for Invoices That Get Paid Faster

We're excited to introduce a few new voices with the first in a series … [Read More...]

How to Pay yourself as an S-Corp

If your business is set up as an S-Corp (or an LLC with an … [Read More...]

Is an S-Corp Right for Your Business?

With all the recent tax shakeups, more and more small businesses are … [Read More...]

Estimated Quarterly Taxes Due Soon!

It's that time! The deadline to pay your fourth estimated tax payment … [Read More...]

Contact

(814) 450-0072

Free 1099 Success Cheat Sheet

Want to be ready for 1099s at year end?
Learn how with my 1099 cheat sheet.

Recent Posts

  • 5 Best Practices for Invoices That Get Paid Faster
  • How to Pay yourself as an S-Corp
  • Is an S-Corp Right for Your Business?
  • Estimated Quarterly Taxes Due Soon!
  • Budgeting for 2019

Reliable, Efficient and Precise

“Deb has handled my company’s invoicing and bookkeeping with impeccable attention to detail and service for several years. She is reliable, efficient and precise – remembering logistics, following through on details, and always smiling. I appreciate her help and value her expertise in handling my finances. Deb is the quintessential professional – I highly recommend her without hesitiaton.”

– Dr. Camille Preston, Owner,
AIM Leadership, LLC

Knows Her Stuff Inside & Out

“Deb is an amazing person, not only at what she does (in which she excels) but her personality is simply the best! She is always in clear control of her work; she knows her stuff inside and out; and she’s such a joy to work with and to count as a friend! I would highly recommend Deb to anyone who is looking for someone who is “above and beyond” the normal bookkeeper.”

– Vickie Turley, Chief Administrative Manager,
BossaNova Consulting Group, Inc.

© 2023 Greenleaf Accounting Services · Privacy Policy · Terms and Conditions