Is there any advantage to getting a tax ID #? Other than being able to get blanks and supplies at a better price?

Taxes have to be paid no matter what for all things purchased and resold. If something that was originally purchased for resale is then used by the purchaser either in their business or personally then taxes are usually due. Bottom line is when a buisness becomes the end user the applicable use taxes must be paid. Check with your states dept. of revenue to determine how to go about this. States have differing tax structures but all require that all applicable taxes be paid. Federal excise taxes are usually applicable too.
So be informed.
Joe Kassuba
HIS Rod Shop

That all I understand...Let me rephrase. I know the profit margin will be greater for me, but, is the hassal of keeping track of the taxes worth the profit? It seems like this is the only way a person can get a break, is by buying wholesale.

You have to keep track and pay taxes whether or not you have a tax ID. The difference if you don't have it and sell something, you are in violation of the law and all it would take is one phone call from an upset customer (or competitor). There is no way to avoid it (legal, that is)

Mike (Southgate, MI)
If I don't want to, I don't have to and nobody can make me (except my wife) cuz I'm RETIRED!!

I guess the biggest advantage would be avoiding jail or stiff fines...lol

Mike Barkley Wrote:
-------------------------------------------------------
> You have to keep track and pay taxes whether or
> not you have a tax ID. The difference if you
> don't have it and sell something, you are in
> violation of the law and all it would take is one
> phone call from an upset customer (or competitor).
> There is no way to avoid it (legal, that is)
>
> Mike
> If I don't want to, I don't have to and nobody can
> make me (except my wife) cuz I'm RETIRED!!

So you're saying if a person builds a rod using components buy at retail, sells the rod and turns a profit, he has to pay taxes? That doesn't sound right.

I'd rather contact my CPA with questions like this instead of relying on hearsay...even from a great place of information like this one. This is especially true when our state & local tax laws differ they way they do across the country.

Jay

Jay's right about where to get your info, but Steve, if you make and sell a rod (or anything else), you owe state and federal excise taxes on the sale.

Mike (Southgate, MI)
If I don't want to, I don't have to and nobody can make me (except my wife) cuz I'm RETIRED!!

...even if all the components are bought retail?

Geez! The gubment wants all our money!

How you buy it has no bearing on anything whatsoever when it comes to taxes. Wholesale only means that you don't pay the Sales tax on what you buy because you are going to be reselling it and the sales tax will be paid by the final buyer. Use tax (the equivelant of Sales Tax) is supposed to be paid to your state on anything that you buy wholesale for yourself or to be used in your business. Whether you purchase wholesale or retail has nothing to do with income tax, sales tax, Federal Excise tax at all. No way around it, if you sell it, you owe various taxes. Check with an accountant!!

Mike (Southgate, MI)
If I don't want to, I don't have to and nobody can make me (except my wife) cuz I'm RETIRED!!

You don't need a Federal Tax ID# to own a business if you don't have any employees AND work out of your home (in Maryland). You can still get wholesale prices from any vendor- as long as you can prove you own a business, which you can do in several ways (faxing the paperwork from the State, for example).