Robin's Ruminations

I mentioned the use tax in an earlier post.  Here's a bit of information on the sales tax and how it might apply to your business as a process server.  

Many process servers also provide some other services and it is important to know which, if any, are subject to sales tax.

For instance, if you obtain copies of documents for a client, and charge them for the copies, you must charge sales tax on the transaction.  You then pay the collected tax to the state when you pay your B&O taxes.  This applies even if you are only passing through the cost you paid (to the court perhaps) to obtain the copies.

In any given month this may not amount to a lot of money BUT, if you get audited by the Department of Revenue, they will go back 3 years and require you to pay the sales tax.  EVEN IF YOU DIDN'T COLLECT IT!  It is possible to go back to your clients and bill them for the tax but collecting it may be difficult.  This will also absorb a lot of your time.

I know this from personal experience and it was not pleasant.  

Don't assume that what you are doing is not subject to sales tax.  Contact the Department and find out.  Click here to visit their website.