Sales Tax on Mulch

[dpld]

Originally Posted by Billy Goat Thanks dpld, your last comment really helped me understand how to factor in sales tax and how to report it to the state. I use to sell stuff on ebay for a profit and had to tax maryland residents 6% sales tax. I had a sales and use tax license and reported my gross sales along with tax collected. Now going into lawn service, I was a little confused when you factor in mulch plus labor and customer pays tax on installed mulch. Iam a good record keeper so I shouldn't have any problems. I was lucky and never got an audit from the state. I want to keep it that way. I want to have my facts straight if a customer questions me why I add sales tax and more so why so much because of upcharge and/or labor cost. They might think Iam ripping them off if they found out you can buy mulch for $30 per yard and I charged them $70 per yard installed. Then taxed them on top of that. Iam sure I will lose some bids because of adding in sales tax. sales tax should have no bearing on you getting jobs or not. it is not optional, it is the law. if someone don't like paying the tax then they should take it up with the respective state they live in and if someone is getting a job because they are cheaper because they did not charge sales tax then they are cheating and not running legit. i also would not be too worried about someone finding out you are paying $30.00 for a yard of mulch and then charging $70.00 per yard for install because there is mark up and they would be a fool to think you would be charging what you are paying for it. people like us are in business because other people are either too lazy or have the income and means to afford to pay us to do it so they don't have to. but it all comes at a price to them by having to spend more to get it done. we are in business to make money and money only. we all start out thinking we are gonna change the game and be mr nice guy but being mr nice guy don't pay the bills and all those wonderful friends you make in business won't mean piss on a ant hill if you can not pay your bills. when you focus on money and you start making money, good money, on a consistent basis then everything else will fall into place and then you will be mr nice guy because you are doing good and have no pressures or worries because the money is there. but to get back to taxes you charge your 6% based on the total job and materials costs and then you bill accordingly. the only thing left to do is figure out if there are any portions spent on materials that already had taxes paid on. the state is only obligated to being paid once for tax and are not entitled to double dip so if it was paid through a vendor you can bet your bottom dollar that i will be deducting it because i refuse to pay them twice.

[willshome]

Lawn care business tips

Originally Posted by SECTLANDSCAPING The auto shop,grocery store, electrician, plumber, would all charge tax on the total bill. So why would we be different? Very true and they all charge big labor Auto shop - brake pads cost $20 but installed $90+ and take 20 mins. Grocery - brownie mix $1.49 but in the bakery $4.99 So why would we be different? Billy Goat labor costs money and most people know it. Mulch is hard work no one wants to do, so don't feel bad making a living

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Brockton Lawn Care
Easton Lawn Care
Fall Cleanup Brockton

[Billy Goat]

Originally Posted by SECTLANDSCAPING

The autoshop,grocery store, electrician, plumber, would all charge tax on the total bill. So why would we be different?

When it comes to most autoshops and grocery stores, resturants etc, they give itemized receipts, which customers can dispute any portion of the bill. With electrians, plumbers etc they mostly give lump sum bills which the customer can not see the break down. I agree that lawn service should fall under lump sum billing since labor is added to material cost, then sales tax is applied on top.

[willshome]

Originally Posted by Billy Goat

itemized receipts,

And you can to just don't itemized your bid/quote down to parts & labor just
"mulch $90" then itemize the receipt at the end of the job "mulch $30, Delivery & install $60"

[SECTLANDSCAPING]

Originally Posted by Billy Goat

When it comes to most autoshops and grocery stores, resturants etc, they give itemized receipts, which customers can dispute any portion of the bill. With electrians, plumbers etc they mostly give lump sum bills which the customer can not see the break down. I agree that lawn service should fall under lump sum billing since labor is added to material cost, then sales tax is applied on top.

I itemize. A few quotes I was told I was a few hundred over. I asked how many yards are the others installing? Is edging included? The person would respond I dont know its a lump sum. I would tell them well I dont know what theyre installing or if edging is included. You might get a inch of mulch with them. I'm installing 4.