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Showing 18 posts in Use Tax.

Are you missing out on these exemptions?

There have been several recent tax changes to Michigan tax law. New exemptions may be valuable to you. Consult a tax professional for advice as to how to make the most of available tax benefits.

Sales Tax Exemption for Vehicle Trade-Ins

Starting Dec. 15, 2013, up to $2,000 of the value of a motor vehicle or recreational vehicle traded-in to pay for a new or used motor or recreational vehicle may be exempt from sales tax. The agreed-upon value must be separately stated. Starting Jan. 1, 2015, the exemption limit is increased by an additional $500 per year.

Use Tax Exemption for Vehicle Trade-Ins

Also starting Dec. 15, 2013, up to $2,000 of the value of a motor vehicle or recreational vehicle traded-in to pay for a new or used motor or recreational vehicle may be exempt from use tax. Learn about other exemptions here> 

Categories: Sales Tax, Tax, Use Tax

Restaurant Owner Held Personally Liable for Unpaid Sales and Use Taxes

Plate with moneyOn May 23rd, the Michigan Court of Appeals upheld a tax tribunal decision that held a restaurant owner personally liable for unpaid taxes, even though that owner had minimal involvement in the preparation of those taxes. Griffin, Jr. v. Dep't of Treasury. The restaurant had failed to pay its sales and withholding tax liabilities for four months, resulting in bills for the unpaid taxes, penalties, and interest on the overdue amount. Based on MCL 205.27a, the Department of Treasury sought to hold the restaurant owner personally liable for the tax bill. Why was an individual liable for the unpaid taxes of a business? ›

Categories: Sales Tax, Use Tax

Arrow Energy v. Department of Treasury - Tax Tribunal Weighs In On Oil & Gas Issues

Foster Swift successfully reverses a $500,000 use tax assessment in Arrow Energy Services, Inc. v. Department of Treasury (MTT No: 404349).

Facts of Case

In 2008, the Department of Treasury audited Arrow Energy for use tax compliance.  Arrow Energy is an oil and gas servicing company.  During the period of the audit, Arrow Energy was primarily engaged in turnkey operations whereby Arrow Energy utilized subcontractors to construct production-ready natural gas wells for third parties. Read More ›

Categories: Use Tax

Court of Appeals Clarifies Agricultural Exemption to the Use Tax

The Michigan Use Tax Act has several notable exemptions, one of which is the agricultural exemption.  The agricultural use tax exemption covers “[p]roperty sold to a person engaged in a business enterprise and using and consuming the property . . . in the breeding, raising, or caring for livestock, poultry, or horticultural products.”  MCL § 205.94(1)(f).  This establishes two requirements for the use tax exemption: Read More ›

Categories: Use Tax

10 Year Use Tax Audit Narrowed

Important!If your business is currently undergoing a use tax audit, then take notice.

The statute of limitations for use tax audits is set forth in the Revenue Act.  Specifically, MCL 205.27a states that: Read More ›

Categories: Use Tax

Navigating the Audit Appeal Process

Navigating the Audit Appeal ProcessEvery year, the Michigan Department of Treasury audits Michigan businesses for compliance with the Sales and Use tax laws. Oftentimes, those audits result in tax assessments that are disputed by the taxpayer. But, how does a taxpayer navigate the audit process and challenge a tax assessment?

Let’s take a look at the basics. Read More ›

Categories: Sales Tax, Use Tax

Tug Boat Case Clarifies Bounds of Use Tax

Picture of tugboatSuppose you visit your local electronics store and purchase a new TV.  You pay for the TV, but notice that the retailer did not charge sales tax.  Are you now liable for use tax?

The answer is “no” according to a recent Court of Appeals ruling. Andrie, Inc. v. Department of Treasury.  But, let’s look at the details. Read More ›

Categories: Sales Tax, Use Tax

Officers Beware! Personal Liability for Unpaid Sales and Use Tax

Most business owners are familiar with the concept of "piercing the corporate veil" – that legal theory whereby owners and officers may be personally liable for the obligations of a corporation.  However, personal liability may also be imposed in the sales and use tax arena. Read More ›

Categories: Sales Tax, Use Tax