Use Tax Reporting Now Required in New York

If you have purchased items over the Internet, by catalog, or by telephone, you must now report any unpaid New York State and local use taxes on your personal income tax form. The Use Tax, similar to the sales tax, applies when the item purchased should have been subjected to sales tax.

You are required to pay New York State the amount equal to the sales tax on the following purchases:

•  Items purchased online or from a catalog, on which you did not pay any

   sales tax

•  Items purchased outside New York (in person) that are used in New

   York, on which you did not pay sales tax or paid less than New York

   State's sales tax

•  Items purchased from abroad

To compute your Use Tax for non-business related purchases of individual items or services costing less than $1,000 each, you may use one of the following two options.

1. Utilizing a simple tax chart based on income - this cannot be used for

    individual purchases in excess of $1,000, business related purchases, or

    for royalty or rental real estate activity related to purchases

    Federal Adjusted Gross Income (Form IT-201, Line 18)

    Up to $15,000                  $6     

    $15,000 - $30,000            $18     

    $30,001 - $50,000            $26     

    $50,001-$75,000              $34     

    $75,001 - $100,000          $43

    $100,001 - $150,000        $54

    $150,001 - $200,000        $69

    $200,001 and greater       .0345% (maximum $200)

2. Exact Method - calculate the Use Tax due based upon the sales tax

    rate of your local jurisdiction and the actual amount of purchased made,

    which sales tax was not charged

The Exact Method must be used on purchases in excess of $1,000. For single purchases made in excess of $25,000, on which sales tax was not paid, Form IT-135 is required to be filed along with additional information such as the date of use within New York, description of the items purchased, and the seller's name and address.

If you believe that you do not owe any Use Tax and enter "0" on line 56 of your New York Personal Income Tax Form IT-201, you may be questioned by the State.