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Showing content with the highest reputation on 05/31/2018 in all areas

  1. 2 points
    Awhile back we had the discussion about the Federal Excise Tax and how it should be applied to sales. Based on my first and only face to face discussion with an IRS field agent who came to my workshop to look over my lure making process, she said FET was based on my sales price. Ok, I took that to mean my retail price and for many years I have been paying quarterly FET based on that information. I guess Uncle Sam got more out of me then I should have been paying. Recently someone here on TU brought up only paying FET on the wholesale price even though they sell directly retail. I questioned it based on what I knew at that time. Well I know more now and I have been wrong with what I was doing. At least it was overpaying, I'm sure if the IRS found me to be underpaying, they would have knocked on the door years ago. I hit my sister up to find out what I should be paying. Yes, she is my sister but she is also a CPA with a MBA and about 25 years of experience in the field of accounting and taxes. She did some digging and found the IRS information needed to know how to pay the FET. For manufactures who sell direct retail, the FET on those sales should be based on the constructive sale price and that is 60% of your retail price. Below is what she emailed me with links to pertinent IRS information: IRS Field directive, see “Determination of Sales Price” https://www.irs.gov/businesses/small-businesses-self-employed/field-directive-federal-excise-tax-on-the-importation-and-manufacture-of-fishing-and-archery-products Here is the tax code document regarding constructive sales price determination: https://www.gpo.gov/fdsys/pkg/CFR-2006-title26-vol16/pdf/CFR-2006-title26-vol16-sec48-4216b-2.pdf It has a modification at IRS Rev Ruling 81-226 to indicate that 60% is what to use when not regularly selling at wholesale. “Revenue Ruling 81-226, 1981-2 C.B. 213, modifying Revenue Ruling 80-273, 1980-2 C.B. 350, provides that the constructive sale price for computing the manufacturers excise tax imposed by § 4161(a), when the articles are sold at retail by manufacturers who do not sell like articles to wholesale distributors, is 60 percent of the actual selling price.” So now I know and don't plan to send in more FET then I'm supposed to in the future. I hope this was helpful to others on here who submit their FET to the IRS. Matt Eisenbacher
  2. 1 point
    Thanks mate they are 4 inch and 7 inch.
  3. 1 point
    I bend mine down at the holes for the snap connection. This gives a nice smooth chatter and will pop out to either side with a jerk of the rod tip.
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