This showed up on another board. Anyone heard of this Pitman-Robinson Tax ? Is there something I'm missing ?
Jeff

shieldski wrote:
It's not too bad. Just have to sign up your business with the state to be able to charge tax. Then you have to sign up with the feds to get a federal tax ID and that's pretty much it. Then they send you quarterly forms to fill out, no biggie. Really depends, I'd say one rod a month or more would make it worth your while.

Jeff


Jeff, I believe you missed one tax.
The Pitman-Robinson act, imposes a tax on all fishing tackle and gun manufactures. I know of some custom gun builders that have gotten their tit caught in that particular wringer.
I'm not sure what the deal is on custom rod builders, but I think yall have to pay the tax too.
For guns its 11%.

The IRS collects it, so they would probably be the ones to check with, to see what you got to do.

Give a man a fish and he will eat for a day. Teach a man to fish and he will sit in a boat drinking beer all day.

Shieldski Customs

The original bill passed to tax sporting equipment is called the Pitman-Robinson Act. Later it was revised by the Wallop-Breaux Amendment. Some folks even refer to it as "The Sportfish Restoration Act", which is actually legislation that directs HOW the funds are spent/distributed among other things. Regardless of the name used to refer to it ... it is all one and the same for OUR purposes and reported on the Form 720 Excise Tax.

This is the simplified version ... but regardless, I hope this helps.

Thanks Jim, much appreciated. That's just what I needed.

Jeff

The Pittman-Robinson tax pertains to hunting and firearms. The tax that rod builders face was originally called Dingall-Johnson, later the Wallop-Breaux and more lately just the Sportfish Restoration Act. The last incarnation added some boating items.

There is an article on it in the online library here.

..............

If you look in the Library on this site there is a good article on calculating the tax and the 60% rule

The excise tax is no longer calculated as in the past. The tax is $10.00 per rod whether you sell it for $20.00 or $1000.00.

The excise tax is no longer calculated as in the past. The tax is $10.00 per rod whether you sell it for $20.00 or $1000.00.

If I'm not mistaken, the $10 is a cap on the tax, NOT the tax. The tax is still 10% of 60% with a MAXIMUM of $10. If you sell a rod for $100, the tax due is $6 If you sell one for $120, the tax due would be $10

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!!

The tax is a tricky beast ... to a degree. I would recommend reading the full article in the library.

Some "twists" kick in IF you purchase goods directly from the manufacturer under an exemption OR if you sell to a reseller and not to the end user. The basics aren't bad - file every quarter on Form 720 and send the $$$.