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Consumers May Be Required to Report and Pay Sales or Use Taxes

For consumers that order tax-free items online, but live in states that charge a sales tax, they are technically required to report that purchase to their state tax agency and pay the sales tax directly to the agency. When consumers are required to do so, it is often called a "use" tax.
The sole difference between a sales tax and a use tax is the person that ends up giving the money to the state government. When it is a sales tax, the retailer is the one handing over the money, while a use tax is handed over directly by the consumer. However, collecting use taxes on small purchases often costs more than simply letting the consumer not pay the use tax. Instead, state tax agencies try to focus more on collecting use taxes for big ticket items that are purchased online with no sales tax, such as cars and boats.

However, there are a number of states that have stepped up their enforcement of their use tax laws and are now trying to make their state residents pay the taxes that should be paid. However, these states are still hampered by limited resources as well as the complexities involved with tracking down minor purchases and demanding that a use tax be paid.
It is worthwhile to keep in mind that state governments are missing out on a substantial chunk of money when it comes to uncollected use taxes. It is not too hard to imagine the federal government stepping in at some point to pass legislation regarding use…...

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