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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 14496
Experience:  15years with H & R Block. Divisional leader, Instructor
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Robin. We are a general contractor that is filling a TPT-1

Customer Question

Hi Robin. We are a general contractor that is filling a TPT-1 form out for the first time. Can you please help us?
Submitted: 1 year ago.
Category: Tax
Expert:  Robin D. replied 1 year ago.
Hello and thanks for trusting me to help you today. I am a tax adviser with over 20 years of experience.
A general contractor would use 015 for their business code in section II col C. This seems to be the area most people have a problem with.
The TPT-1 needs to indicate that the funds you are submitting are designated for your area. This is done under the Transaction Detail section (II). Under Business Description (A), write "the town"; under Region Code (B), write the two digit code for that town or city; in the Business Class (C), write the numeric code of “015”.
Let me know the exact line you are having trouble with and I will assist all I can.
Customer: replied 1 year ago.
So sorry I should clarify better. We are a general contrator but we also do a ton of work as a sub contractor. We pay taxes on ALL material up front. When I talked to the department of revenue they told me to use code 500. NO?
Customer: replied 1 year ago.
also do we need to list each job seprately and the amount we made off each job?
Expert:  Robin D. replied 1 year ago.
Yes, code 500 will be used as your deduction code. 500 - PC: MAINTENANCE REPAIR Etc CONTRACT with PROPERTY OWNER
The 15 is your State Business Code.
The city Business code is after those.
Yes, the jobs should be listed separately especially to distinguish the descriptions and the difference in your work (general and sub)
Customer: replied 1 year ago.
what column is the deduction code go under?
Expert:  Robin D. replied 1 year ago.
The deduction code is shown on Schedule A column M
Customer: replied 1 year ago.
what does deduction amount column e refer to?
Customer: replied 1 year ago.
what is the accounting credit rate and accounting credit columns refer to?
Expert:  Robin D. replied 1 year ago.
The amount in Column e is the gross receipts that are deductible or
exempt income.
Deductions are to be itemized by category in Schedule A on page 2 of the TPT‑1 form.
It could include sales for resale; labor or delivery charges for retail sales; sales of exempt manufacturing equipment; and exempt retail food sales. You may not have any amount here.
The accounting credit rate for your classification should be preprinted on your form. If you are preparing a blank form, you can find the accounting credit rates in Table I of the TAX RATE TABLES.
http://www.azdor.gov/Portals/0/TPTRates/201506.pdf
To get the Accounting credit (column J) you multiply column F by column I. Enter the result in column J. This is your accounting credit.
Customer: replied 1 year ago.
would construction materials be classified as sales for resale?
Expert:  Robin D. replied 1 year ago.
The retail tax does not apply to the sale of materials to a
taxable prime contractor or a subcontractor if the
materials are incorporated into a construction project. You would not list them as resale
Customer: replied 1 year ago.
i'm just looking for a deduction code for materials.
Customer: replied 1 year ago.
we should add that we are an llc and file as a sole propriertar (sp?)
Expert:  Robin D. replied 1 year ago.
That would be the 500 code the state agent advised about. That is for subs. The deduction code for materials would be the 500.
http://www.azdor.gov/LinkClick.aspx?fileticket=krfLO411oDQ%3d&tabid=347
Expert:  Robin D. replied 1 year ago.
FREE EXTRA INFORMATION FOR YOU
http://www.tucsonaz.gov/finance/contracting-changes
I do not know if you are in Tucson, but the above link has an example of the city TPT that may assist you in seeing a completed form.
The changes that were made to the reporting is also included.