Taxing Kathy Posner

Associated Press ran a story the other day about a “new” Illinois law that, “allows people who didn't pay sales tax on items bought online, through the mail or over the phone between June 20, 2004, and the end of 2010 to pay what they owe without penalty. The tax amnesty runs from Jan. 1 through Oct. 15.” The story also said, “Illinoisans can often dodge sales taxes by shopping online, but the state is hoping to collect on those taxes next year by offering a sales tax amnesty.” This statement is so wrong that it is ludicrous!

First, Illinois law requires online companies with an office or any kind of presence, including brick-and-mortar stores, in the state, to remit sales taxes for products delivered in Illinois. The company must collect the tax.

Second, Illinoisans do NOT DODGE taxes by shopping on-line. It is not the buyer’s responsibility to pay sales taxes; it is the retailer’s obligation to collect them. Big difference!

Third, how can there be a NEW LAW giving a tax amnesty when no OLD LAW existed requiring the buyer to be responsible for the payment of the online sales tax.

Fourth, how is a buyer to know if an online company has an Illinois presence and should be charging a sales tax? If one is buying from Amazon, there is no information that the selling company has an Illinois location.

Fifth, how can a buyer know back to June 20, 2004 what companies did not collect sales tax from them on a purchase? I can’t tell you what I bought last week, much less six years ago! If I don’t know what I owe, how is the Illinois Department of Revenue supposed to know what I owe, if anything?

The AP story concluded with, “Department of Revenue spokeswoman Sue Hofer tells the (Springfield) State Journal-Register that Illinois also plans to offer a more detailed worksheet on state income tax return forms to get taxpayers to pay up.”

Can you hear my laughter through the computer? Could anything be more stupid? A taxpayer is going to “turn themselves in” and declare they were cheating by avoiding sales taxes that were not their obligation to pay??

I just hope this blog does not make the Illinois Department of Revenue mad and they audit me for spite. I’ll let you know next year.

Read more from Kathy Posner here....