Pittman–Robertson Excise tax on Bows Question...

[toomanyknots]

I have a question about the 11% tax on bows that you have to pay if you sell a bow over 30 lbs, regarding this:

"Determination of Sale Price

In General.  The tax on sport fishing equipment, electric outboard motors, and bows is based on the price for which the article is sold.

The price for which an article is sold includes the total consideration paid for the article, whether that consideration is in the form of money, services, or other things.  Section 4216(a).

    Include the following in the sale price:

        Any charge for coverings or containers (regardless of their nature).
        Any charge incident to placing the article in a condition packed ready for shipment.

    Exclude the following from the sale price:

        The manufactures excise tax, whether or not it is stated as a separate charge.
        The actual cost of transportation, delivery, insurance,  installation, and other expenses incurred by the manufacturer or importer in placing the article in the hands of the purchaser pursuant to a bona fide sale.  (The costs of transportation of goods to a warehouse before their bona fide sale are not excludable.)
        Discounts, rebates, and similar allowances actually granted to the purchaser.
        Local advertising charges.
        Charges for warranty paid at the purchaser’s option."


So, say John Doe sold a bow on ebay. And now he has to pay his 11% tax. Ebay has advertized his bow for him. He has had to pay ebay 10% of the price, and 10% on the shipping costs as well (which really eats into the cost of the price anyway, since you don't actually get to keep your shipping money??  ). Without paying this money, he would not of been able to have his bow advertized on google, google shopping, etc. So according to this, can John Doe legally exclude the ebay fees from the price the bow sold, since he is essentially paying advertizing costs (among other things) to ebay? Here is link to the irs page:

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Field-Directive-Federal-Excise-Tax-on-the-Importation-and-Manufacture-of-Fishing-and-Archery-Products#whois

[toomanyknots]

Also, I am not sure about this:

"Exclude the following from the sale price:

        The manufactures excise tax, whether or not it is stated as a separate charge."


Is that saying to exclude the .11% excise tax from the price the bow sold, to where what is left is the actual taxable "sale price"? Since what you would pay as the person who "manufactured" the bow is the manufacturers excise tax? ( Also, just making sure, direct links are ok as long as it is not to anywhere where anything is being sold, right? )

Edit: Or do neither of those apply, because of what is says first:

"In General.  The tax on sport fishing equipment, electric outboard motors, and bows is based on the price for which the article is sold."

"the price for which the article is sold" seems pretty cut and dry to me?
 

[bow101]

Not sure different here in Canuck land.  Just fix the price in for the tax...........................maybe I'm missing something..........   There is a solution for that for that its reverse tax calculation.

[Mohawk13]

I think P-R applies to established, licensed business'. If you do a private sale as a private individual, You are not required to pay a P-R tax. If Ebay is making you pay one, they are in error.

Do You have a business license for a sporting goods store? This may make a difference.

[Pat B]

You may want to contact a tax professional.  Ignorance of the law is no excuse. I'm just saying! 
 My take on it is the 11% P-B tax comes off the top, the sale price.

[Mohawk13]

You are correct Pat. As a prior Gunshop Owner, Had to pay the tax. Is the OP a licensed entity, or a private seller? Private sales are exempt from P-R taxation

[toomanyknots]

You may want to contact a tax professional.  Ignorance of the law is no excuse. I'm just saying! 

I talked to me and my wifes tax guy, a licensed cpa, and he was no help at all.  Did our taxes for cheap though, lol.

My take on it is the 11% P-B tax comes off the top, the sale price.

That's what I am thinking, just because of this: "In General.  The tax on sport fishing equipment, electric outboard motors, and bows is based on the price for which the article is sold." But I still would like to know for sure. We all know our taxes always go exactly where they are supposed to and all ( ) but still I would not want to overpay.

I think P-R applies to established, licensed business'. If you do a private sale as a private individual, You are not required to pay a P-R tax. If Ebay is making you pay one, they are in error.

Do You have a business license for a sporting goods store? This may make a difference.

Ebay's not making me do anything. I do have a vendors license (sales tax license) for sporting goods in ohio.

[toomanyknots]

You are correct Pat. As a prior Gunshop Owner, Had to pay the tax. Is the OP a licensed entity, or a private seller? Private sales are exempt from P-R taxation

Thank you, I appreciate it. I do have a sales tax license in ohio. I will send you a PM if that is ok...

[koan]

I havent heard of this before but..... All my bows are 30# @ 20" but they can be drawn to 28"....we may have to play their games but theres more that one way to skin a cat! Lol  .... Brian

[toomanyknots]

And another question, do you gotta file / pay quarterly? Is this the right form (form 720): http://www.irs.gov/uac/Form-720,-Quarterly-Federal-Excise-Tax-Return

[mullet]

I don't see where the same piece of equipment can be taxed more then the first purchase. And, I haven't noticed any black helicopters flying around my house . I think the Government has it's hands full right now,rather then be bothered chasing down $5 or 6.

[Mohawk13]

Used Equipment, When sold through a licensed dealer, is treated the same as new. Used to pay P-R tax on all the used firearms I sold, just the same as the new, The GOV cares not if it is used or new, just as long as they get their cut....

If you sell one or two a year, and have no license..ie sell one or two on an auction site..No worries. You are just disposing of excess personal property, and this carries no P-R liability..

Game changes when a business license comes into play..

[Ink]

You should consult with your state comptroller if you want to know exactly what is legal for your situation.

[toomanyknots]

You should consult with your state comptroller if you want to know exactly what is legal for your situation.

Thank you, will do.