legal questions...

[brian_walsh7]

can anyone tell me for sure if it is 100% legal to conduct business meetings

and collect money in a public restaurant/cafe/coffee shop such as a starbucks

and a borders??? i always assumed it was until questioned by a client and its

got me thinking? anyone know for sure?

 

also has anyone ever dealt with clients who wanted to pay cash and bypass

paying taxes for their wedding? whats the 'professional way' to handle this

when someone asks? what would you do?

[mikep]

Its actually two questions you are asking.

It is illegal not to collect sales tax no matter what form of payment. Cash is still legal tender and tax should be added to it.

 

Working in a Starbucks poses no problems, as long as the client is ok with it. It seems it can be convienent at times I guess.

[ronald_moravec1]

Simply tell them the state requires you to collect sales tax. It is something to avoid unless you keep two sets of books etc.

 

Avoid that type of client.

[mikep]

Ask you client how does he think you feel every quarter when you need to pay your accountant to do the paperwork to send taxes collected to the municipality? But you do it. And then tell that what they are asking you is illegal.

[eric merrill]

I have never had anybody ask to avoid paying sales tax. I simply state up front that I collect sales tax on top of all prices. I have been paid in cash, but that included sales tax. I'm the one on the hook for paying the tax, so I'm the one the department of revenue would pursue for back taxes and penalties. Just not worth it.

 

Besides... The simpler answer? It's wrong. I operate honestly. I don't try to cheat my customers. I don't try to cheat my suppliers. I don't try to cheat the gub'mint. How am I supposed to expect my children to grow up knowing right from wrong if daddy is a cheat?

 

 

Eric

[annealmasy]

I've had a handful of people ask about a "cash discount". Sometimes they think they'll get

a break because I don't have to pay the credit card fees, and sometimes they're hoping to

avoid sales tax.

 

I've never heard of it being illegal to exchange money in a private business establishment.

(Remember, a Starbucks is NOT a "public" coffee shop.) Of course, I've never heard of it

being illegal in a public place either!

 

It's illegal to NOT collect sales tax. Period. A simple, "I'm sorry, but the state requires me

to collect sales tax, no exceptions" should satisfy your client.

[doug_axford1]

I get the 'tax' question all the time since we pay 14%. I had one lady bugging me for a tax break and I said no. The next guy in line smiled and said he worked for the tax office. True story.

 

Now I look the person straight in the face and ask them if they are willing to go to jail for me when I'm caught. It stops the problem fast.

 

Doug

[conraderb]

Not charging sales tax is a violation of your responsibilities as a vendor. Whether or not you think it is right for the state to take their cut in every transaction that you conduct, it's also not fair to all the other photogs who DO charge sales tax.

 

I would recommend smiling and explaining to those clients that you could get in a bucket of trouble if you didn't collect sales tax.

[frank_skomial]

"legal to conduct business meetings and collect money in a public restaurant/cafe/coffee shop such as a starbucks and a borders???"

 

- I guess Brian asks if he, not being Sturback or Borders employee, can walk in there and ask customers there for money.

 

He is not standing behind the cashiers counter there and is not empowered to collect payments for services that includes taxes. If he was - he would not be asking this question at all.

 

Is Brain bothering customers there and asks for money ? Is it legal ? Can Starbuck or Borders tolerate that ?

[jimstrutz]

I don't collect sales tax from clients. It's too much bother. Nor do I inform the state or local government about it. I don't regard it as any of their business what I do for spending money.

[tumble2113]

I hear a lot of people asking for a cash discount on everything. It is probably assumed that if they pay you cash you can do what you want with it, bot report it, hide in a matress, whatever.

It would be dishonest for you to not report it, but to give people the discount is not neccesarily so. If you value getting cash over check or credit card.

[jimstrutz]

You guys ought to do your business in Anchorage coffee shops. We have more coffee shops per capita than Seattle. Yeah, that's right -- we are now the number one coffee consumers in the nation! Besides, we have a more "enlightened" taxation policy here. We let BP & Conico Philips pay the taxes for us. Well, actually, since you're buying their fuel, I suppose ultimately you're paying our taxes for us. For which I thank you profusely by the way.

 

But to get serious, No, you can't not report sales to avoid taxes. It's dishonest, and it will bite you someday. Besides, somebody's got to support the government. If you don't want to do it, you have to find your *own* oil company -- we're not sharing ours.

[robgreer]

In regards to Jim Strutz's post above, I certainly hope the IRS is reading this board.

 

Do you not drive on your state's highways? Do you not benefit from the social services provided by your state and federal government?

 

You probably don't care, but what you are doing is dishonest and illegal. You should be prosecuted! And to think that you proclaim yourself to be a pastor! You certainly set a great example for your "flock."

 

Rob Greer

[robgreer]

... and maybe Jim should have included a ;) in his initial post. ;)

 

Rob

[al_kaplan1]

You could do your pricing to "include tax" and raise your prices a bit. You still have to figure out what the tax would be, though. If you charge $100 including 7% sales tax make out the sale for $93.46. When you add the 7% it comes out to $100.0022 which is certainly close enough.

 

Here's the math to figure out the tax. First multiply: 100 x 100 = 10,000. Divide that by 100 plus your tax rate. At 7% that would be 100,000 divided by 107. That equals 93.4579 so round up to 93.46. That's your before tax price and the 7% tax equals $6.54. From now on just subtract 6.54% from the gross sales price to find the net price, and the difference is the tax.

[jimstrutz]

<I>"I certainly hope the IRS is reading this board."</I>

<P>

Rob, I was hoping for more reaction to that post, but that's all I get, I guess. But just to let the IRS know, I am paying federal taxes, we just don't have a sales tax. I also pay property taxes, which are a bit much locally. Too bad we can't get the oil companies to pick up that one too.

[john_h.1]

Clients that suggest a scheme to bypass taxes can be told that your policy is to bypass jail instead.

[William Michael]

> can anyone tell me for sure if it is 100% legal to conduct business meetings and collect money in a public restaurant/cafe/coffee shop such as a starbucks and a borders? <

 

If it were illegal to transact a business contract in such places how could you ever pay for your coffee, or be asked if you want a cookie with it?

 

> I don't collect sales tax from clients. It's too much bother. Nor do I inform the state or local government about it. I don't regard it as any of their business what I do for spending money. <

 

I agree. I stopped including sales tax in 2000. Far too much trouble calculating 22.5%.

 

In its place we have a flat 10% Goods and Services Tax, which I dutifully collect and file QUARTERLY.

 

> also has anyone ever dealt with clients who wanted to pay cash and bypass paying taxes for their wedding? What`s the 'professional way' to handle this when someone asks? What would you do?

 

Yes, to the first part of the question, but it would be only assumption on my part to the second part of the question, and I do not investigate that.

 

From my experience, the `can I pay cash question`, seems to refer to a discount based upon credit card charges we would pay.

 

For businesses here, it is a breech to advertise a product at a cheaper price for cash, relative to the credit or debit card price, so that stops that: but recent legislation allows merchants to pass on the full cost (including all taxes) of all card transactions to the customer.

 

So that technically allows a merchant who is passing on the full costs to not pass them on if the transaction is cash.

 

In regards to the bypass paying tax for the Wedding part of the question: that is impossible for us to facilitate, as each Contract generates a Tax Invoice and they linked together forever as they carry the same number, so does the Client File and each image prefix number for that job.

 

So in theory, the way we have things set up, the only way to facilitate such a request is to have no contract, no job details, no client details and no images, which IMO is stupidity both for the merchant and customer.

 

I have never been asked outright by a customer a request like what you have outlined, but in essence after stating it is `Impossible for us to to do` the above would be my detailed answer.

 

WW

[bobbollinger]

In most states, it is the legal obligation of the vendor-that is you-to collect the sales taxes and pay them into the state tax agency. If you fail to do this, then they come after you, not your customer. You owe the taxes to the state whether you collect them from your customer or not.

 

Bob Bollinger, Attorney at Law