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Discussion Starter #1
First off I’m going to send this to my taxman and see what he thinks but I though I’d see if anyone here has received a similar letter and what your thoughts are on this (whether or not you own a Sentry Safe or have received a letter or not).

Today, in the mail, I received a letter from Sentry Safe whom I bought a gun safe from a few years back (actually via another internet vendor but I guess Sentry actually drop shipped it). In this letter it states that I didn’t pay sales tax on this item and that auditors from the California State Board of Equalization have examined their records and determined the sale was taxable. They are nice enough to give me the invoice number and tell me that the tax is 8.75% but they don’t tell me what the actual price I paid was (like I remember or still have the receipt, LOL). So, according to them I need to look this up somehow and pay them, Sentry Safe, 8.75% tax on this item. Also, I must do this by January 25th “to minimize the potential for interest being assessed by the State” (on whom, me or them?).

Now, my first reaction to this is, to bad, I guess you (Sentry) will have to eat the tax loss.

Then I started to think, these state tax bass-tards might in fact try to go after me. If I recall, since its not a large safe, it was under $500 so we’re only talking about something like $40 or so which would be well worth it just to avoid having to go through a state tax audit (if my taxman thinks they’d really do that).

The other thing that seems a little strange to me is why is Sentry asking me for the money instead of the state? Shouldn’t the state be billing me for this instead of Sentry? How do I know they’re even going to use my money for this instead of just pocketing it and then sicing the state on me anyway?

Anyway, just wondered what ya’all think about this. I’ll post what the taxman says if there’s enough interest.
 

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That's a new one.

I know the State of California wants it's pound of flesh on internet sales, but maybe their hunger for tax revenue is pushing them to go after sales completed long ago.

If the State of California came at me demanding taxes I might pay it to get them off my back.
The Board of Equalization can be very aggressive.

However if the company that sold the item (Sentry) is asking for you to pay, it appears they are in the hot seat with the State and looking to their customers to bail them out.
 

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Sounds like a SCAM. I doubt Sentry had a thing to do with the letter. Could see if they have a website with an email contact or 800 number and ask them directly. You don't have to identify yourself.
 

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I have been thru several sales tax audits when I worked in Mass. The state will not go after the individuals who did not pay but the company who did not collect it. It sounds like the company is now trying to recover the money they paid to the state from the individuals that didn't pay it. How long ago was it and what is California statute of limitations? I presume Century is asking you to pay them. The state could care what Sentry does with you they will get their money from Sentry with interest added.
 

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Guys, reread the OPs post. He did not buy it from Sentry, he bought it from an internet vendor. The internet vendor is the one with the tax responsibility, not Sentry. Sentry was just given an order from XYZ internet vendor and told to deliver a XXX Sentry safe to the OP. The internet vendor is who would collect the sales tax from the OP. Sentry has no dog in this fight. Sounds like a scam to me.
 

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Discussion Starter #7
Here's what my taxman said...

I believe Sentry was audited an assessed the tax that they should have
collected.

They are now asking you to pay them what they should have then.

My reaction is the same as your first reaction. Let them eat it. Esoecially
since they did not even tell you the amount. What you paid would have
included shipping which is not taxable, so you would not know the amount
unless you had the original invoice.
 

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Guys, reread the OPs post. He did not buy it from Sentry, he bought it from an internet vendor. The internet vendor is the one with the tax responsibility, not Sentry. Sentry was just given an order from XYZ internet vendor and told to deliver a XXX Sentry safe to the OP. The internet vendor is who would collect the sales tax from the OP. Sentry has no dog in this fight. Sounds like a scam to me.
If Sentry sells to the internet vendor but drop ships to a CA resident then Sentry is fine if the vendor provides them with a resale certificate and the vendor collects the tax. If the vendor does not and disappears off the internet then Sentry is on the hook. If they have the resale certificate then they shouldn't be on the hook so it sounds like don't and CA audited them and saw the CA shipments and dug deeper.

Use tax is typically for those that purchased out of state and brought the item in state without having paid the sales tax. e.g. Many from Mass come up to NH which has no sales or income tax to buy major items like big screen TV's. Mass auditors have tried parking in the stores lots to bag their own residents. It could conceivably be used for internet sales but the state is going to go the easiest route and go after the retailer or in this case distributor.

I would tell Sentry their beef is with their retailer not me, sorry.
 

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State Use Tax is governed at the state level, in this instance only California law applies.
 

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State Use Tax is governed at the state level, in this instance only California law applies.
That goes without saying I used Mass only as an example but I'm guessing you don't have a lot of instances that the state is after the individual but rather goes after the seller where their auditors can get at a much larger assessment. The way I have seen tax assessmentments handled in other locations is they audit a year and then apply it to all years since the last audit, typically a five year period. Interest is assessed and the company gets a fat bill.

The fact that Sentry is looking for payment indicates they are on the hook with the state. The CA info states:

The California use tax is generally the liability of the purchaser and must be paid either directly to the seller from whom the physical merchandise was purchased or directly to the Board of Equalization (BOE) if the retailer is not required to collect and report California tax.


California Use Tax Information - State Board of Equalization

 

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If an out of state seller has no physical presence in California they can ship to us and tell the State of California to pound sand.
That leaves it up to the buyer to disclose the purchase and pay sales tax on their state income tax return.
Hardly anyone actually does that...

California is bankrupt and cash starved so they are trying every trick in the book to squeeze money out of people.
One of the latest State Treasury scams is to absorb bank accounts that have been "inactive" for a period of time...
such as if you just left your money in the bank and didn't add to it or draw from it.
The State is supposed to attempt to notify the account holder, but in many cases have failed to do so and just taken the money.
You go to the bank and your account is empty. Pffft... and it's gone.
 

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That goes without saying I used Mass only as an example but I'm guessing you don't have a lot of instances that the state is after the individual but rather goes after the seller where their auditors can get at a much larger assessment. The way I have seen tax assessmentments handled in other locations is they audit a year and then apply it to all years since the last audit, typically a five year period. Interest is assessed and the company gets a fat bill.

The fact that Sentry is looking for payment indicates they are on the hook with the state. The CA info states:


[/B]
California Use Tax Information - State Board of Equalization

Yes, from a practical standpoint they go after the big fish, ultimately though as your info points out... " The California use tax is generally the liability of the purchaser". How they collect it is another matter, but the purchaser is the one on the hook in the end.
 

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I'm a far cry from a lawyer. If you paid the distributor for the safe, the distributor should be paying sentry for the safe since the middle man bought it for resale, there was no sales tax. The middle man, who sold it to the end user (you) should be responsible for sales tax to the state. I know when i made a sale at work once, i forgot to figure sales tax and this was on a $2200 item, my employer had to eat it.
 

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If an out of state seller has no physical presence in California they can ship to us and tell the State of California to pound sand.

That leaves it up to the buyer to disclose the purchase and pay sales tax on their state income tax return. No one actually does that...
As I'm sure you are aware, "physical presence" is becoming hard to define, the state of course want's as loose an interpretation as possible to maximize the tax collected by retailers. The new online sales tax law here in Cali measures it now by how much business a company does here regardless of physical presence.
 

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If the letter came regular mail and not certified or registered and you did not have to sign for it, then forget about it, if it was really important they would have sent it registered or certified.
 

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Sounds like MGM (Money Grabbing Mongrels). I would not pay it, my take would be that the tax (although not stated on the invoice) was included in the purchase price. If the letter is not from the state, I would not think a penalty could be assessed until you hear from the state, not the vendor, as he has already been payed.
Maybe he should be told, that he should pay his taxes when due, and that you have no intentions of paying them for him.
Just my $.02
 

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If Sentry is audited by the state then they obviously have a physical presence in the state otherwise Sentry's attorneys would tell the state they aren't welcome to audit them. They didn't have a resale certificate from their customer that sold the safe retail otherwise they wouldn't be involved. The letter is a comical attempt to scare the OP and others into paying them what they owe the state. The OP didn't have a contract nor was he billed by Sentry therefore Sentry's problem is with their customer the internet sales company. Sentry wouldn't be involved at all nor would they need a resale certificate if they had shipped to the internet company instead of drop shipping to OP. My answer to Sentry sue me for it.
 
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