Tax

Have a tax question? Ask a tax Expert

Ask an Expert,
Get an Answer ASAP!

I am just learning bookkeeping and am helping out my family…

Customer Question
I am just learning bookkeeping...
I am just learning bookkeeping and am helping out my family business which involves the sale and delivery of landscape rock, gravel, sand, etc.
I know that all material that we sell is taxable unless the purchaser qualifies as a licensed tax-exempt purchaser (I think that it is an AZ5000). However, occasionally we are hired to clear and move material to dump for a customer that involves only labor and the use of our truck and maybe a tractor. In a situation such as this is the labor taxable? Thank you for your help.
Submitted: 2 years ago.Category: Tax
Show More
Show Less
Ask Your Own Tax Question
Answered in 20 minutes by:
1/19/2016
Tax Professional: Lev, Tax Advisor replied 2 years ago
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 33,340
Experience: Taxes, Immigration, Labor Relations
Verified

The Arizona transaction privilege tax is commonly referred to as a sales tax; however, the tax is on the privilege of doing business in Arizona and is not a true sales tax. Although the transaction privilege tax is usually passed on to the consumer, it is actually a tax on the vendor.

If you are selling a product or engaging in a service subject to transaction privilege tax, you will most likely need to obtain the state transaction privilege tax (TPT) license from the Arizona Department of Revenue (commonly referred to as a sales tax, resale, wholesale, vendor or tax license) and a transaction privilege tax or business/occupational license from the city(ies) in which you are based and/or operate.

Ask Your Own Tax Question
Tax Professional: Lev, Tax Advisor replied 2 years ago

Prime contractors are subject to transaction privilege tax under the prime contracting classification. A prime contractor is a person who performs, coordinates or supervises construction work, including contracting with any subcontractors. The prime contractor is the person responsible for the completion of the contract.
A prime contractor who only furnishes labor in the performance of contracting work is subject to the tax as well as one who furnishes both labor and materials.
Subcontracting income is not subject to transaction privilege tax if the subcontractor can demonstrate that the job was within the control of a prime contractor and that the prime contractor is liable for the tax on the job. If the subcontractor is given a Transaction Privilege Tax Prime Contractor’s Certificate (Form 5005) that has been completed by the prime contractor, the subcontractor is relieved of the burden of proof.
See for reference
https://www.azdor.gov/Portals/0/Brochure/603.pdf
https://www.azdor.gov/Portals/0/Brochure/622.pdf
.
I appreciate if you take a moment to rate the answer.
Experts are ONLY credited when answers are rated positively.
If you still have any doubts, need clarification - please be sure to ask.
I am here to help you will all tax related issues.

Ask Your Own Tax Question
Was this answer helpful?

How JustAnswer works

step-image
Describe your issueThe assistant will guide you
step-image
Chat 1:1 with a tax professionalLicensed Experts are available 24/7
step-image
100% satisfaction guaranteeGet all the answers you need
Ask Lev Your Own Question
Lev
Lev
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 33,340
33,340 Satisfied Customers
Experience: Taxes, Immigration, Labor Relations

Lev is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,338 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,512 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

PhillipsEsq.

PhillipsEsq.

Attorney-at-Law

59 satisfied customers

B.A., M.B.A, J.D.

Robin D.

Robin D.

Senior Tax Advisor 4

15,569 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,655 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

< Previous | Next >

Related Tax Questions
I signed a contract for a company to supply install palett
I signed a contract for a company to supply install palett racking in pa They bought the rack from a co in Tennessee They are charging me tax on the labor to install? And also charging tax on their pr… read more
emc011075
emc011075
Senior Tax Specialist
Bachelor's Degree
16 satisfied customers
Is everything including freight & labor subject to sales
Is everything including freight & labor subject to sales tax? … read more
Chad EA, CDFA®, CFP®
Chad EA, CDFA®, CFP®
IRS Enrolled Agent, CFP(R),
Master\u0027s Degree
2,610 satisfied customers
IRS Section 199 DPAD Question: The company is in the
IRS Section 199 DPAD Question: The company is in the business of manufacturing offshore baskets and renting them out to other businesses. However, occasionally they will purchase the materials and out… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
I have 5 apt rentals on the property I also live on. The
I have 5 apt rentals on the property I also live on. The building is over 100 years old and is in constant need of repair. I actively manage the place. I have a truck that principally used for mainten… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Question re California District Sales Taxes. Our company sells
Question re California District Sales Taxes. Our company sells and installs office furniture: We very rarely have walk-in traffic to our warehouse/sales office, and then it is by appointment only as o… read more
Lev
Lev
Tax Advisor
Bachelor's Degree Equivalent
33,340 satisfied customers
I am running a Landscaping company in Texas, and a good customer
I am running a Landscaping company in Texas, and a good customer has me in charge of almost all outdoor construction of a new home. Am I correct in assuming that all labor that is considered construct… read more
fastfile
fastfile
Tax Advisor
Master's Degree
550 satisfied customers
What is the legal definition of a subcontractor in the construction
What is the legal definition of a subcontractor in the construction industry? For example, at times we need an extra dump truck to haul gravel, so we will call a local driver that owns his own truck a… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
15,569 satisfied customers
Should a company issue a 1099-misc in the following scenario: A
Should a company issue a 1099-misc in the following scenario: A quarry where we normally purchase goods (rock & sand) and deliver these goods ourselves using our own trucks, will at times deliver the … read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
15,569 satisfied customers
I am being audited for my 2009 tax year. The IRS disallowed
I am being audited for my 2009 tax year. The IRS disallowed several of the business expense deductions I had claimed. 2009 was a very unusual work year for me. At the end of 2008 I had completed my se… read more
fastfile
fastfile
Tax Advisor
Master's Degree
550 satisfied customers
Is there a 12% FET tax on a Kenworth tractor imported
Is there a 12% FET tax on a "USED" Kenworth tractor imported from Canada to the US? It was purchased by a US individual from a canadian trucking company (not a dealer). Is it considered a "first retai… read more
Charles Greiner
Charles Greiner
Owner
Bachelor's Degree
2,436 satisfied customers
We have a tax exempt number in the state of Arizona. We are
We have a tax exempt number in the state of Arizona. We are purchasing materials from a vender in the state of Arizona and having the vendor ship these materials to a job in Colorado. This vendor does… read more
RD
RD
Self Employed
Master's Degree
1,164 satisfied customers
Hi, My husband purchased a new truck November of this year
Hi, My husband purchased a new truck November of this year and I would like to know if we can take the full purchase price off our taxes as section 179...I don't believe it is listed property because … read more
Lev
Lev
Tax Advisor
Bachelor's Degree Equivalent
33,340 satisfied customers
Not sure how to charge our customers. The service we provide
Not sure how to charge our customers. The service we provide is diesel engine repair in Texas- diesel engines on rigs, 18 wheelers, farm equipment, shrimp boats, tug boats. We charge labor and milegae… read more
Robin D.
Robin D.
Senior Tax Advisor 4
Vocational, Technical or Trade School
15,569 satisfied customers
what are the NJ laws regarding motorcoach tax exemption (ie parts
what are the NJ laws regarding motorcoach tax exemption (ie:parts purchases for coaches, shipping tax and labor tax)… read more
Merlo
Merlo
Tax Consultant
558 satisfied customers
I OWN 125 ACRES AND LEASE THIS LAND TO A LOCAL FARMER. I REPAIRE
I OWN 125 ACRES AND LEASE THIS LAND TO A LOCAL FARMER. I REPAIRE WATERWAYS AND MAINTAIN YEARLY. CAN I FILE AS FARM BUSINESS AND DEDUCT EXPENSES? TRACTOR,GAS,GRAVEL AND STONE LABOR PAID OUT,MOWER,SCRAP… read more
Lev
Lev
Tax Advisor
Bachelor's Degree Equivalent
33,340 satisfied customers
I have a sole-proprietership constructio business. Is there
I have a sole-proprietership constructio business. Is there any advantage to purchasing a vehicle before the end of the year?… read more
RD
RD
Self Employed
Master's Degree
1,164 satisfied customers
Can sales tax be charged on labor bill in Arizona?
A landscaping Co. in Arizona wants to charge me sales tax on his entire bill. Is this legal in Arizona, or does he have to separate the materials from the labor? I know when I have auto repairs perfor… read more
Ed Johnson
Ed Johnson
Senior HR Consultant and Business Devlpm
Bachelor's Degree
6,994 satisfied customers
i made a purchase on line and realized that the dollar ...
i made a purchase on line and realized that the dollar amount I was being taxed on included the cost of S&H. When I set up sales tax for our company I was told we either tax materials OR Labor. This c… read more
Ed Johnson
Ed Johnson
Senior HR Consultant and Business Devlpm
Bachelor's Degree
6,994 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x