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Grex > Coop10 > #90: Cyberspace Communications, Inc. Finances Through February 28th, 1998 |  |
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| 15 new of 39 responses total. |
gibson
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response 25 of 39:
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Mar 19 05:17 UTC 1998 |
They are 2 seperate numbers, I have both for my business.
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aruba
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response 26 of 39:
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Mar 19 06:45 UTC 1998 |
Hmmm... Well, when we applied for a sales tax license and our number came
back, lo and behold it was the same as our EIN.
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rcurl
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response 27 of 39:
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Mar 19 07:44 UTC 1998 |
What are your two numbers, Patrick?
Even tax exempt organizations must have an EIN .. in order to have
a 501(c)3 exemption. And, as Mark says, any corporation doing business
in Michigan has to have a sales tax license, for which they need an EIN.
So, Walter, which corporation to your knowledge does not have an EIN
(and please provide an e-mail address for their treasurer, so I can
ask).
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mcnally
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response 28 of 39:
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Mar 19 21:42 UTC 1998 |
re #24: "every corporation does not have an X" does not have the same
meaning as "not every corporation has an X". pet peeve of mine,
but when you're making a point it helps to say what you mean..
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scg
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response 29 of 39:
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Mar 19 23:33 UTC 1998 |
By "every corporation doing business in Michigan," you mean "every corporation
selling things in Michigan," right? Presumably if a corporation isn't selling
anything taxable, they don't need a sales tax license.
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gibson
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response 30 of 39:
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Mar 20 01:40 UTC 1998 |
I have a state sales tax number and a different EIN. I got the state
number first, so possibly , if you have the EIN first they use that for both.
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i
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response 31 of 39:
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Mar 20 03:25 UTC 1998 |
Rane, last i knew, neither the IRS nor the SSA had blanket requirements
for corporations to apply for EIN's. And being exempt from taxes does
*NOT* imply 501(c)(3) status (any more than being too poor to have to
file a 1040 implies some special status). A corporation need not be
a business. Whether it's currently legal or not, there are loads of
little clubs and other organizations that are incorporated for reasons
mostly of organizational convenience, and i'd happily bet that plenty
of them have never filed for an EIN. With no sales, no profits, and
no payroll, a club has to be quite rich to be required to file any
returns at all with any tax authority. (But annual filings and a $15
(?) fee are needed by the State's corporate registration office to keep
one's status as a corporation.)
I also don't think that 501(c)(3) implies an EIN, but i'm less familiar
with that subject. Janc?
Re #28: i figured it was clear from emphasis & context.
If you start a new C corporation in MI, gets an EIN, then sign up with
the State for SUW taxes (sales, use, & withholding), you'll have 3 tax
ID numbers - the EIN, the state sales tax license number (EIN with a
single letter (geographically based, i believe)) in front of it, and State
tax ID (same as the EIN). Then there's the MESC gang, with their own
unrelated numbers. If you shift around the sequence, change incorporation
status and ownership some, etc., you can wind up with a collection of
current & former tax ID numbers, and some of the State numbers may bear
no resemblence to the corresponding Federal numbers.
(I do this semi-professionally, but not regularly, so anything here is
+/- a few years of changes.)
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rcurl
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response 32 of 39:
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Mar 20 05:18 UTC 1998 |
People should distinguish the state sales tax license to sell stuff, for
which you get a number, and the states sales tax license for buying stuff
not for resale, for which you do not get a number. Shall we call these
sales tax(s) (for selling) and sales tax(b) (for buying) licenses?
I was incorrect that a corporation must have 501(c)3 exemption for
a state sales tax(b) license: you can also be one of a number of types
of organizations such as schools, health, welfare, etc. However the
only category in which Grex could get a state sales tax(b) exemption
is with a 51(c)3 federal tax exemption as a charitable organization.
I also reviewed the application for incorporation in Michigan, and it
does not require a federal EIN. However the federal govenment requires
that you obtain an EIN if the corporation receives *any* money (you
would need one to have a bank account, for example). The organization
with which I am most familiar does not have to pay any taxes or even
file a 990 tax form because it is both 501(c)3 and has no taxable
income, but nevertheless it is required to file annually another form
that declares that it does not have to file a 990.
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gibson
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response 33 of 39:
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Mar 20 05:25 UTC 1998 |
Rane, when i buy for resale my sales tax # is used by my suppliers,
whon i buy for my shop use i pay the taxes to the supplier. When i sell the
taxable item i then pay the tax due at my next payment period.
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rcurl
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response 34 of 39:
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Mar 20 05:31 UTC 1998 |
Right. This is all sales tax(s). (Forget what s and b stand for - just
distinguish the business sales tax from the charitable sales tax exemption.)
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i
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response 35 of 39:
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Mar 21 05:51 UTC 1998 |
??? Sales and use taxes (on stuff sold and stuff bought but not resold)
are reported and paid on the same Michigan tax forms. Resale is only one
of several exemptions from sales tax, though - are you thinking of a mixed
situation?
Last I knew, unless a non-profit was turning over $20K/year, was mailed
forms by the IRS, or hit some (rather rare) criteria, it didn't have to
file ANY federal form (990EZ or otherwise). (Calling payroll rare for
that small a non-profit may be optimistic.)
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rcurl
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response 36 of 39:
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Mar 21 06:50 UTC 1998 |
The MKC with an annual budget of ca. $2400 (from donations) is a 501(c)3
tax exempt corporation and each year is sent a form to file to confirm
that it does not have to file a 990 form.
I am only thinking of the Grex situation. It requires obtaining a license
from the state to be able to buy products for its own use without paying
state sales tax. It appears, though, that vendors do not understand the
requirement, and issue their own procedures for tax exemption. We have
had the state form, which clearly says what the vendor is supposed to do
to record the sale as tax exempt, refused by vendors. I would sure like
this cleared up.
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aruba
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response 37 of 39:
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Mar 21 07:24 UTC 1998 |
I sent away for what I hope is the appropriate information publication. I'll
let you all know when I get it.
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i
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response 38 of 39:
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Mar 22 22:08 UTC 1998 |
Ah, 501(c)(3). I was thinking of more mundane organizations (non-deductable,
so the IRS has less reason to keep tabs on 'em).
My experience in purchasing is that every vendor has their own ideas about
sales tax collection. (Though if you deal with enough of 'em, you can
start to see natural divisions and subdivisions like a botanist looking
over the woody plants.) My suggestion would be to check out the following
scheme with the state sales tax folks:
- tell the vendor that Grex is buying the product for resale. (My
experience is that (computer-related) vendors will either take
a copy of the state sales tax license or their own (very simple,
one-page, "I promise to collect the tax myself") form.
- buy the product for resale (no sales tax paid)
- move the product from inventory to internal use. (Using Grex's sales
tax exemption to *legally* avoid paying the use tax that a normal
business/reseller would have to pay at that point.)
If legal and unobjectionable to the state tax people, this could make it
much easier to deal with vendors. (I'm somewhat sympathetic with the
vendors from my own experience in this area. Such tax-exempt/nonprofit
sales are quite rare for most vendors, and the state tax offices are
not very supportive.)
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aruba
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response 39 of 39:
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Mar 22 23:28 UTC 1998 |
Well, first we have to get the exemption. :)
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