Sales Tax Overcharge

[bkade]

I'm in Vermont. I recently discovered that I was being billed for sales tax on items that had been credited. For instance, they charged me $49.99 for a service call and also credited me that amount. Nevertheless, my sales tax charge was based on the uncredited amount of the bill. Since I am still in the first year of use, I was getting a $15 (or whatever) discount each month off the basic package. When I checked, I found that I was being charged sales tax on the full amount.
I notified DirecTV and they agreed that this was an error. When I inquired as to whether this was an error in their program affecting all customers, they said it was.
Today I notified the Vermont tax department. They were quit interested.
I am wondering if other states are experiencing this screw up. Talk to me.
Barry:

 

[raoul5788]

I'm in Vermont. I recently discovered that I was being billed for sales tax on items that had been credited. For instance, they charged me $49.99 for a service call and also credited me that amount. Nevertheless, my sales tax charge was based on the uncredited amount of the bill. Since I am still in the first year of use, I was getting a $15 (or whatever) discount each month off the basic package. When I checked, I found that I was being charged sales tax on the full amount.
I notified DirecTV and they agreed that this was an error. When I inquired as to whether this was an error in their program affecting all customers, they said it was.
Today I notified the Vermont tax department. They were quit interested.
I am wondering if other states are experiencing this screw up. Talk to me.
Barry:

Interesting! I was always under the impression that even if you were getting a discount like you are, you pay taxes on the full amount, because you are getting full value, even though it's at a discounted price. Let us know what happens. This could get very interesting!

 

[meStevo]

I wonder if you'll just have to itemize something like this on your state taxes.

Though this would probably be vastly offset by all of the online tax free purchases many of us make that we're supposed to report (from what I understand of state tax stuffs)

 

[markfp-1]

Try crossing over the border into New York. About the only thing we don't get taxed for is breathing and the Governor is working on that.

 

[joed32]

When I order pizza with a buy 1 get 1 free deal they charge sales tax on the free pizza. California.

 

[stonecold]

1. Service calls our billing system when issuing a credit for soemthing if tax was applied to that item then the apporaite tax will be removed automatically.

2. promotional credits like ones for new service or 10 off for 6 months or 5 off for 3 etc and you have say choice xtra which is 60.99 then you pay tax on 60.99 not on the 50.99 that is is after th 10 dollar discount that just state law.

 

[meStevo]

OK, I misread something about the first post I think. You are receiving a $15 credit. That's it. You aren't receiving discounted services, you are receiving a credit. So you are paying $xx per month, and then at some point (in most cases the same day your fees are processed) you also receive a $15 credit.

That's not really a 'glitch', just the lack of a proper explanation. You pay taxes on the full price of the service.

You can also receive regular credits outside your billing cycle. For example if my bill was on the 2nd of every month, a credit may appear every 10th cause that's the day they initiated the regular credit. I could pay my bill in full on the 3rd and on the 12th of next month my bill is $20 less than normal. Point being they're not tied to the service you are paying for.

 

[Big Dawg 23]

I'm in Vermont. I recently discovered that I was being billed for sales tax on items that had been credited. For instance, they charged me $49.99 for a service call and also credited me that amount. Nevertheless, my sales tax charge was based on the uncredited amount of the bill. Since I am still in the first year of use, I was getting a $15 (or whatever) discount each month off the basic package. When I checked, I found that I was being charged sales tax on the full amount.
I notified DirecTV and they agreed that this was an error. When I inquired as to whether this was an error in their program affecting all customers, they said it was.
Today I notified the Vermont tax department. They were quit interested.
I am wondering if other states are experiencing this screw up. Talk to me.
Barry:

the above posts are correct. Tax is structured on the original amount and not credited amount. If directv were to do an instant discount and not a credit at the end to square up the bill that would be different. I work in a business where we provide service and goods in the lodging industry. I get many hotels that want to argue the tax situation. It is most common in Clark County NV.

In the end if I read it correct you have no credit coming because it is a discount after the fact.

 

[Joseph Schneider]

sales tax is based on the amount charged! you can not give a "discount" after the fact because you would be charging tax on money not paid. it is tax fraud, and if there books reflected as mutch they would certainly be audited. when a Walmart associate walks in to walmart and buys $100.00 in taxable merchandise at a tax rate of 8.25% the total before discount would be $108.25. the 10% discount drops the subtotal to $90 and the total to $97.42. this is because charging sales tax on something not sold is tax fraud.

 

[jwgreen68]

Nevermind