I just got off of the phone with our new accountant. I was asking questions regarding how to pay taxes, pay estimates, etc., because to be honest, there is still a lot that I don't completely understand 100%. I wanted clarification. Anyway, based on the amount that I told him I had made so far this year, I need to be charging sales tax. I didn't think about it until I hung up the phone about the amount to be charging. NC's sales tax is 7.5%, but food is taxed differently, is it not? I don't want to be overcharging. I've looking online and am not finding anything that's specific. So, with that in mind...those of you with legal businesses, what amount do I need to charge for taxes? Is 7.5% correct?

Thanks a bunch!!!
Amy

ditto -- inquiring and befuddled minds would like to know!

A grocery store receipt I have says 2% food tax charge but Im not sure if the cakes we do should be charged the 2% or the 7.5%. I would think it would be the 2% but I am not sure either.

~Sonya

I need to know this too.....I would think that the 2% would be the one..but not sure.

According to a chart that I found through a Google search, food tax for bakeries is 4%, plus the local tax of ? Now, I'm totally confused. Geepers!!! I'll call my accountant back tomorrow morning and straighten this out for all of us.

Amy

http://www.dornc.com/downloads/sales.html


is a list of tax charts


http://www.dornc.com/forms/index.html

list of other forms that may be needed

Found this online (actual bill-break out the lawyer lingo)
http://www.ncleg.net/Sessions/2005/FiscalNotes/Senate/PDF/SFN1466v1.pdf

It says that the NC state legislature passed a bill last year pretty much to clarify previous tax code, since different retailers were acting differently.

Heart of the matter: bakery items (unless sold for consumption on the premises i.e. with cutlery) are exempt from the state tax and only have to pay the local 2% tax.

Just finished researching this for Texas. Had seen somewhere here on CC that baked goods were exempt, same as in NC, but needed to make sure on my own. Yup. Exempt. Yippee!! As Forrest Gump would say...One less thang.

So we only have to pay 2% tax on our bakery goods? I am more and more confused.....and I have to get my tax stuff for this quarter in the mail on Monday! I have all my receipts and all that good stuff , just don't want to UNDERPAY! Anyone in NC have any answers?

I am really hoping that the 2% is correct now -- I am going to do some research this afternoon. Our cash registers are currently set to charge 6.75%, which is what we were told to charge after the last decrease.

I called the department of revenue and they told me 6.75% unless you are on mecklenburg then it's 7.25%

Who do I need to contact regarding paying quarterly taxes? I've been putting back 50% from each order to account for my taxes. With no personal accountant at this time, I feel like I'm re-starting from ground zero.

Thanks!
Amy

I just called the guy at the IRS....yep, we charge 6.75%.....and I have not been charging enough. He was very nice..and after my embarassment, he said hey, everybody has to learn! I know now what to do....and my tax form and payment are in the mailbox. WHEW! Glad to have that done.......until next time.......rofl.......

Countrycakes...since you're in NC and paying quarterly, can you help with my ??? re: above posting?

Thanks a bunch!
Amy

I know Amy, I am so confused......it was easy this time, because I have not sold but so much...but my orders are picking up, therefore, the $ is too!!! I was undercharging for tax this time...but I know better now. Maybe we can all get this mess figured out? I don't have a personal accountant either......I just want to do it right!

Amy, I called them and they walked me thru mine....I have been legal and legit since May 1......I was supposed to have gotten it in the mail BEFORE JULY 31........ he was nice and said that I had to get it in the mail TODAY......I had a small window. I had been charging only 2%.......I should have been charging 6.75%. Oops!

He told me what to put where, I told him my $ sales, and he figured up my tax, etc.....and helped me thru it this first time. I will be getting someone to help me.....I am easily confused! They are very nice to deal with, the people at the local IRS office I called. HTH.

Same here, Country. I've been putting back 50% from each order to have to pay towards the taxes. Before my accountant moved, he told me that I needed to contact the IRS about "expected" forms??? I feel like an idiot calling them and asking where to send my "expected" income, when I have no way to judge what "expected" even is. My business last year wasn't legal until September, so the "orders" were freebies. By the time I was legal, and started advertising, KA-POW! This legal stuff is very, very confusing to me, and anytime I call with a ?, it's a long sigh on the other end of the line. Makes me feel so dumb!

Amy

Amy, I feel like since you have put back 50% of each sale, you should be covered in paying taxes..just call them! They are helpful!

Thanks! I'm dialing right now...

Amy

Did you receive an envelope with your quarterly forms in the mail? I had 2 forms, to file at the end of July and at the end of October....it came with my tax id number. It also has envelopes for the dept of revenue to mail my quarterly tax forms and payment back in.....

No, I didn't. (I'm on hold right now...) I only received my tax ID numbers, and information regarding it. Perhaps that was inadvertently left out? Hmmm...another question to add to my list...once I'm off hold...

Amy

Okay, I passed DOA inspection. I had my business name recorded at the register of deeds. I applied for and received an EIN from the IRS.

What else is there before I'm legal???

If I am not mistaken, that's it! Good luck.

just a little FYI --

for NC taxes -- you can file your payments on line and have the amount taken from your checking account by EFT.

I do it this way for both my cake sales and all my church's employment withholding.

and if you ever get to the point of having to file taxes w/ IRS, can get it set up to do electronically there too -- even any W2s or 1099s you need to file (great at end of year to go to gov site and just plug in the numbers, e-file and even print out the W2s and 1099s)

There ain't no special "you can do business within my jurisdiction" paper I gotta have?

and where do I get a license???? I'm sooooo confused!