Idaho State Tax Commission

Idaho State Tax Commission

Tax Commission News Release

Holiday shoppers: You may owe use tax on Internet purchases

BOISE, IDAHO — Nov. 25, 2013 — With Black Friday and Cyber Monday just around the corner, the Idaho State Tax Commission is reminding online holiday shoppers and others that they may owe use tax to the state if the seller doesn’t charge them sales tax.    

When shoppers buy goods on the Internet, by telephone, or from a mail-order catalog, sellers won’t charge sales tax if they’re not Idaho retailers. In that case, the shoppers owe use tax if the goods are used, given away, stored, or consumed in Idaho. The shoppers are responsible for paying the tax directly to the Tax Commission.

The use tax has been around since 1965 and is the same rate as the sales tax (6 percent). “Most people don’t know about or understand the tax,” said Randy Tilley, the Tax Commission’s Audit Division Administrator. “But it’s an important tool to ensure that Idaho retailers can compete fairly with out-of-state companies that don’t charge tax.”  The tax also helps fund state and local services throughout Idaho.

Tilley said Idahoans can report and pay use tax on their Idaho individual income tax returns. “We encourage folks to keep track of their untaxed purchases, total them up at the end of the year, and make a payment when they file their income taxes next year,” he said.

Taxpayers can also fill out Form 850-U, (Idaho Self-Assessed Use Tax Worksheet and Return), available at tax.idaho.gov, and pay use tax at any time during the year.

More than 9,600 Idahoans paid use tax totaling more than $544,000 on their 2012 income tax returns, but that number is estimated to be a fraction of what is owed.

“As more people shop online and more sales go untaxed, we’ll continue to raise people’s awareness of their use tax obligation,” said Tilley.

For more information about use tax, visit tax.idaho.gov, watch the Tax Commission’s Use Tax video on YouTube, or call the Tax Commission at 334-7660 in the Boise area or toll free at (800) 972-7660.

Posted 11-25-2013

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