Kentucky Sales Tax Compliance

Kentucky sales tax compliance is fairly simple and straight-forward in comparison to other states’ tax laws. Kentucky has a state-level sales tax rate of 6%, and the state does not offer reduced rates. Due to this, businesses can expect to collect and remit a 6% sales tax rate on all taxable sales they make.

Kentucky Sales Tax

There are three filing frequencies at which taxpayers file their tax returns which will be determined by the Kentucky Department of Revenue at the time of registration. These three frequencies are monthly, quarterly, and annually. Kentucky sales tax compliance requires all taxpayers to file by the 20th of the following reporting period, no matter their filing frequency. If the return due date falls on a weekend or national holiday, then the correct due date will get pushed back to the next business day.

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Businesses that qualify for Nexus in Tennessee collect and remit sales and use tax on the sales, lease, or rental of tangible personal property (an item you can touch, smell, or taste), recreational activities, and digital products. Digital products are subject to a special local rate unless the products are also available as tangible product. For example, an eBook version of a book in print. In cases like that, the digital products are taxed at the normal rate.

While most services are exempt from tax in Tennessee, some have specific laws making them taxable. Taxable services include lodging services and rooms, short-term rental space for making sales, cleaning/repairing/installation of tangible personal property including animal bathing or computer software installation, parking or storage of motor vehicles, telecommunication & ancillary telecommunication services, and enriching of uranium materials.

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Aaron Giles - State Sales And Use Tax Exemptions 1

Alaska, Arizona And Arkansas Sales Tax Exemptions

Alaska Sales Tax Exemptions

The state of Alaska is one of five states in the U.S. that does not charge a state sales tax. At the local level over 100 municipalities do collect a sales tax, with rates ranging between 1% and 7.5%.   For more information on Alaska sales tax exemptions please visit:

Alaska Department of Revenue
Alaska Sales Tax Exemption Statement

Arizona Sales Tax Exemptions

The state of Arizona levies a Transaction Privilege Tax, which is similar to sales tax in other states. The state rate is 5.6% and is levied on all purchases of tangible personal property unless specifically exempted. All Arizona counties collect an additional tax ranging between 1-5.3%.
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Alabama Sales Tax Exemptions

Alabama levies a 4% state sales tax on all purchases of tangible personal property unless the transaction is specifically exempted. There are more than 200 city and county sales taxes imposed in addition to the 4% state sales tax rate. Alabama’s range of sales tax rates is between 4% and 11%.

The consumers use tax is imposed on tangible personal property brought into Alabama for storage, use, or consumption in the state when the seller did not collect seller’s use tax on the sale of the property. The tax rates due are the same rates as for sales tax. Returns are to be filed on or before the 20th day of the month following the month in which the purchases were made. For example, purchases made in the month of January should be reported to the state of Alabama on or before February 20th.

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Aaron Giles And State Fuel Taxes

When we go to fill up at the corner gas station nearby we’re all familiar with the choices of diesel and the various octane ratings of unleaded fuel.  What your corner gas station may not have is a pump for dyed diesel.  That isn’t really a problem for individual consumers, but it might be for business consumers who may qualify for excise tax refunds on clear diesel used in a qualifying manner.

What is dyed diesel fuel?

Dyed diesel is called by a number of different names – off-road diesel, untaxed diesel, pink or red diesel – but the only real difference between it and the clear diesel is that dye has been added.  The dye is added to distinguish it from the clear diesel because dyed diesel is taxed at a lower rate by both the state and federal government.

Dyed diesel is illegal for use on roads and highways because it is taxed at a lower rate than clear diesel.  The taxes on clear diesel include both state and federal taxes for the maintenance of the roads and highways.  Because dyed diesel is intended to be used “off-road” the taxes to offset the costs of the wear and tear caused by vehicles operating on the roads and highways are not included in the taxes levied on dyed diesel.

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Aaron Giles - Texas Sales Tax Exemption

The Texas sales tax exemption for manufacturing makes purchases that are necessary and essential to the manufacturing process non-taxable.  Under the general heading of the Texas Sales Tax Exemption for manufacturing, there are a number of subcategories of purchases which are designated as taxable or non-taxable by the Texas Comptroller’s Office.

A manufacturer, as Texas defines, is a taxpayer who manufactures, fabricates or processes tangible personal property for sale. Texas Administrative Code 3.300 explains in detail what items specifically are exempt from sales tax and which items are not.  This list is not intended to be exhaustive, but does provide taxpayers solid guidance about what may and may not qualify for the Texas sales tax exemption for manufacturing.

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Aaron Giles - Sales Tax Audit Defense

Sales tax audit defense is one of the cornerstones of our sales tax consulting practice. We’ve represented hundreds of clients who were undergoing sales tax audits. We’ve fought audit assessments in all 45 U.S. states that have sales tax. One of the most common questions we hear from taxpayers upon receiving the notification of a sales tax audit is, “What should we do now?” We’ve put together the following list of the best tips and tricks of the trade from our experience as sales tax consultants defending a sales tax audit.

Sales Tax Audit Defense Tip #1 – Relax

It’s never good news when you find out that your company has been selected for a sales tax audit. It seems like the initial reaction everyone has is to cringe and think “I wonder what the auditor is going to find?” Followed quickly by the second thought of “I wonder how much time this audit is going to take?” While no one will ever confuse a sales tax audit with fun, it’s important to remember that there is nothing you can do to avoid the process. Stressing about what prompted the sales tax audit is a useless endeavor and it’s important to remember that it doesn’t necessarily mean that the state suspects any wrongdoing by your company. In fact, I’d say from our experience that less than 10% of audits are generated because of some suspected liability.

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Georgia will require online retailers to file sales tax compliance returns beginning January 1, 2019, if their annual Georgia revenues exceed $250,000 or if they have more than 200 separate retail transactions within the state per calendar year.

As an alternative to collecting Georgia sales tax from its customers and filing sales tax compliance returns, the retailer may instead send “tax due” notices to all Georgia customers who purchased more than $500 of taxable goods during the year. The law, which originated as House Bill 61 and became Act 365, was signed by Governor Nathan Deal on May 8, 2018.

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In Michigan sales and use tax law determining whether an item of tangible personal property remains tangible personal property or becomes a fixture affixed to real estate can significantly affect the taxability of the item in question. This determination may impact whether the taxpayer is considered a retailer or a contractor.

There are also several exemptions in Michigan sales and use tax law for purchases of tangible personal property that do not apply if the item is instead a fixture. The Michigan sales and use tax exemptions for both the agricultural industry and the industrial processing or manufacturing industry include such language.

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Georgia sales tax exemptions for healthcare providers, including hospital, clinics, and medical practice groups include several categories of purchases. One Georgia sales tax exemption for healthcare providers that a sales tax consultant from Agile Consulting Group has been recovering a significant amount of refunds for relates to prosthetic devices. Georgia Code Ann. § 48-8-3(54) states that prosthetic devices that are sold or used pursuant to a prescription are exempt from Georgia sales and use tax. Our sales tax consultant has learned that the prosthetic device may be purchased exempt from Georgia sales and use tax by a hospital, clinic, or medical practice group if it is sold or used pursuant to a prescription under federal or state law and title and possession is permanently transferred to a natural person to whom a prescription for the device is issued, per Georgia Comp. Rules & Regulations § 560-12-2-.30(5)(a). Read More

North Carolina sales and use tax law provides an exemption for sales of mill machinery, machinery parts and manufacturing accessories, however these items are subject to a 1% privilege tax with a maximum tax of $80 per article until June 30, 2018. The 1% privilege tax has been repealed effective June 30, 2018 by Senate Bill 257 from the 2017 Legislative Session.  Beginning July 1, 2018 purchases of qualifying mill machinery, machinery parts and manufacturing accessories will be exempt from both North Carolina sales and use tax as well as the privilege tax. Read More

The New Jersey sales and use tax exemption for manufacturers enables machinery, apparatuses, or equipment to be purchased without paying New Jersey sales and use tax.  New Jersey Revenue Statute 54:32B-8.13(a) further clarifies the sales and use tax exemption by stating that the machinery, apparatuses or equipment must be for use or consumption directly and primarily in the production of tangible personal property by manufacturers, processors, assemblers or refineries. This New Jersey sales and use tax exemption for manufacturers applies to any such machinery, apparatus, or equipment regardless of whether the item is purchased, rented or leased. Read More