Tax Exempt? at DVinfo.net

Edward Mendoza · September 26th, 2011, 11:07 AM

Working with a client whose project is federally funded. I charged tax to them on my first invoice, in which they explained to me that because the project is federally funded, they are tax exempt, and don't have to pay taxes on it. They said they could provide something in writing to my accountant at the end of the year explaining this. I asked them if, being under the umbrella of the project, I was exempt as well and they said yes. Does anyone know if this is so, or are the rules a little different because I'm a contractor?

Shaun Roemich · September 26th, 2011, 12:15 PM

The correct answer is: contact your accountant NOW and deal with this from your side so there is no surprise when it comes time to file and you are on the hook to remit federal taxes due to a "misunderstanding"

Pete Bauer · September 26th, 2011, 03:06 PM

If the client is a commercial entity working for profit themselves, it is perhaps possible -- but doubtful -- that the client is entitled to exemption from state tax. Even when I've traveled for the government I had to present a form to the hotel to have the state taxes waived, and sometimes the hotels don't want to honor them and I (and thus the US government) end up paying state tax.

Shaun's advice is good, but at the very least they need to show you something official in writing, not just their opinion. Here's some info that probably isn't applicable in this situation, but just in case it is helpful to you for your own purchases...:

Texas Film Commission, Office of the Governor Rick Perry - Sales Tax Exemptions

Chris Davis · September 26th, 2011, 06:34 PM

I don't know about Texas, but here in Minnesota, if they can't provide a tax-exempt certificate, they pay tax. It's really that easy.

September 26th, 2011, 11:07 AM	#1
Edward Mendoza Regular Crew Join Date: Oct 2006 Location: San Antonio TX Posts: 157	Tax Exempt? Working with a client whose project is federally funded. I charged tax to them on my first invoice, in which they explained to me that because the project is federally funded, they are tax exempt, and don't have to pay taxes on it. They said they could provide something in writing to my accountant at the end of the year explaining this. I asked them if, being under the umbrella of the project, I was exempt as well and they said yes. Does anyone know if this is so, or are the rules a little different because I'm a contractor? __________________ Edward Mendoza, Videographer/Editor, TEXAS VIDEO PRODUCTION www.texasvideoproduction.us

September 26th, 2011, 12:15 PM	#2
Shaun Roemich Inner Circle Join Date: Sep 2002 Location: Vancouver, British Columbia (formerly Winnipeg, Manitoba) Canada Posts: 4,088	Re: Tax Exempt? The correct answer is: contact your accountant NOW and deal with this from your side so there is no surprise when it comes time to file and you are on the hook to remit federal taxes due to a "misunderstanding" __________________ Shaun C. Roemich Road Dog Media - Vancouver, BC - Videographer - Webcaster www.roaddogmedia.ca Blog: http://roaddogmedia.wordpress.com/

September 26th, 2011, 03:06 PM	#3
Pete Bauer Wrangler Join Date: May 2003 Location: Eagle River, AK Posts: 4,100	Re: Tax Exempt? If the client is a commercial entity working for profit themselves, it is perhaps possible -- but doubtful -- that the client is entitled to exemption from state tax. Even when I've traveled for the government I had to present a form to the hotel to have the state taxes waived, and sometimes the hotels don't want to honor them and I (and thus the US government) end up paying state tax. Shaun's advice is good, but at the very least they need to show you something official in writing, not just their opinion. Here's some info that probably isn't applicable in this situation, but just in case it is helpful to you for your own purchases...: Texas Film Commission, Office of the Governor Rick Perry - Sales Tax Exemptions __________________ Pete Bauer The most beautiful thing we can experience is the mysterious. It is the source of all true art and science. Albert Einstein Trying to solve a DV mystery? You may find the answer behind the SEARCH function ... or be able to join a discussion already in progress!

September 26th, 2011, 06:34 PM	#4
Chris Davis Trustee Join Date: Jul 2005 Location: Willmar, MN Posts: 1,400	Re: Tax Exempt? I don't know about Texas, but here in Minnesota, if they can't provide a tax-exempt certificate, they pay tax. It's really that easy.