Other State Sales Tax

by | Mar 25, 2014 | Dealer Compliance, Sales, Sales Tax: Other State Rates

NOTICE:  The information below was obtained directly from the Florida Department of Revenue (DOR) website. Links are provided so you may access the content on the DOR website.

FAST FACTS

When an out-of-state customer takes delivery from your lot and the unit will be titled and registered in another state, you must:

  1. Collect sales tax based on the rate of the customer’s state (can be as little as zero but not more than 6%)
  2. Have customer sign (have customer’s signature notarized) Florida Department of Revenue Form DR 123
  3. If customer will take care of processing their own title and registration in their state, have customer sign Division of Motorist Services Form HSMV 84061
  4. Remit sales tax to Florida – NOT THE OTHER STATE
  5. Access other state sales tax rates here.

When a customer drives the vehicle off your lot and it will be registered in another state, you must collect the sales tax rate that the customer’s state charges. Some states don’t have a state sales tax on vehicles while others have a sales tax above 6%. You are authorized to collect as little as zero tax (for those states that do not have a state sales tax) to as much as 6%, but never more than 6%. All sales tax collected must be remitted to the Florida Department of Revenue. Which states are not reciprocal with Florida? Arkansas, Mississippi and West Virginia. You are still required to collect the amount of sales tax charged by these states, even though the customer will not receive credit for the tax paid to Florida. Unfortunately, when they return home to process their title and registration, they will have to pay the tax again. The only way to prevent the double payment of sales tax to these three non-reciprocal states is to have the unit delivered outside of the State of Florida. You must also have each out-of-state customer sign (and have their signatures notarized) a DR 123 form. To access this form click here. If the customer will process their own title and registration paperwork when they return to their state, have the customer sign the Division of Motorist Services Form HSMV 84061. If you are going to process their title and registration, this form is not required. NOTE: All sales tax collected from out-of-state customers must be remitted to the Florida Department of Revenue, not to the customer’s state.

For other state sales tax rates click here.