So it's been awhile since I've posted, lots of work to show. I was audited by the great state of NC for sales and use tax. This consumed alot of my time and I've learned alot. Not as bad as it could of been ........... I had itemized my invoice labor/creative fee and than the tangible (film/media) on a seperate line with a total. I was only paying sales tax on the tangible goods. WRONG. It is gross-sale. I was doing it this way because the people at th NCDOR told me. WRONG. So I spoke with NCDOR by phone on some questions and this was my anwser-
I have spoken with a Sales & Use Tax Agent at the NCDOR to clarify this
issue. He was actually unwilling to commit to a definitive answer with the
information I gave him. He suggested that we write to NC DOR and request a
So I'm now waiting for some anwsers in writting.
1-If a job is $1000, and is billed photography/creative fee $999 and media is billed at $1, than you pay tax on $1000.
2-If a job is $1000, and is billed photography/creative fee $999 and a seperate invoice is $1 for media,you pay tax on $1.
3-If the client provides media CD/DVD no tax is paid.
4-If a file is emailed , no tax is paid.
When I get my letters from the NCDOR I'll post that information.