Fabrication Tax

[Up Hut]

Can anyone share how you are listed the fabrication tax on invoice? This is a CA tax.. (of course) They are telling us it should be 20% of your labor total and then tax at $7.25.. We already tax on the material..

Thanks

[JDUpholstery]

I am not sure of CA taxes, but here in Arkansas we tax the entire job, labor and material, I always include a taxed shop fee as well to cover thread, staples, etc. because if I don't then they expect me to pay a use tax on my thread and such...I would much rather pass that extra cost onto the customer!

[sofadoc]

Fabrication tax is a new one on me.  I briefly ??? read up on it a few minutes ago.
I understand that it is a tax for fabricating, or altering a new product to meet a customer's specific needs (such as re-sizing a ring). My extremely short attention span prevented me from reading any further (my eyes were already glazing over).

UpHut: What kind of work do you do? Since most types of upholstery involve refurbishing (not fabricating) of tangible personal property, are they subject to a fabrication tax?

If indeed, California upholsterers are subject to such a tax, it seems like it would behoove them to just charge an enormous mark-up on the fabric, and give the labor away for free. ;)

In Texas, upholstery is NOT subject to labor tax........however........it is considered a "Taxable service". So the bottom line is........yes, you tax the labor (same rate as material sales tax).
So when I make out an invoice, I just tax the whole bill at 8.25%.

[Mojo]

And people wonder why citizens do not start small businesses.

The taxes, laws, regulations etc. are a royal PITA.

Chris

[baileyuph]

Fabrication tax for CA, no help.  Ask another long time shop how they meet requirements or CA.

Chris, I understand your question.  Business over head is through roof.  Here in my state, the local laws prohibit doing a business in the home.  Maybe something with a deck and computer are exempt if there is no patron traffic.

Which MEANS, commerical property!  That brings in all the cost one can think of into play.

Some now and then try to do work out of the home, but it doesn't work out usually.

I could sell and go to work for someone else and not put up with all the head aches but those employers cannot usually afford to pay a very good wage.

So what to do?

Back to the thread, yes, just go to some business that is subject to fabricaion tax there in CA and they probably would show you how they do the invoice. 

I am not in CA.
Good luck,
Doyle

[byhammerandhand]

Not true.   I heard it on TV that people don't build businesses by themselves.   They have lots of help.  I'm still waiting for smiling Joe to come over and help out.   Who was that guy that invented the internet?

( I have seen a number of signs on fronts of businesses that read, "We built this business, not the gov't.")

And people wonder why citizens do not start small businesses.

The taxes, laws, regulations etc. are a royal PITA.

Chris

[JuneC]

And people wonder why citizens do not start small businesses.

The taxes, laws, regulations etc. are a royal PITA.

Chris

Indeed!  My degree is in Accounting and I still have to read paragraphs of the tax code for forms instructions 3 or 4 times over to understand what it is they want.  There are many times I see ads for sewers/seamstresses that I think I'd like to just sew and let someone else worry about all the paperwork. 

June 

[Rich]

Not true.   I heard it on TV that people don't build businesses by themselves.   They have lots of help.

I can't imagine any business owners wanting to vote for the individual who made that remark. I certainly didn't!
Rich

[Eric]

Here in Wisconsin, you have to have a bathroom. So I either had to install one in building, which had to be wheelchair accessable, or allow them to use house bathroom.
Eric