November 25, 2014 Contact: Terry Stanton, (517) 335-2167
Cyber Shoppers Reminded to Keep Receipts and Report Use Tax on MI 1040
The Michigan Department of Treasury is reminding shoppers that purchases made on-line are not tax-free during holiday season, or at any other time of year. Michigan’s Use Tax generally applies to transactions in which the retailer does not collect sales tax. This happens most frequently when an individual makes a purchase from on-line retailers, through mail-order outlets, or television shopping networks that do not have physical locations in Michigan. When out-of-state vendors do not collect sales tax on purchases, under Michigan law, the purchaser is responsible for reporting and paying the Use Tax. Taxpayers can report the Use Tax annually when completing and filing their Michigan Individual Income Tax Return.
For more information, visit www.michigan.gov/taxes and click on the Sales and Use Tax tab.
Michigan’s Use Tax is calculated at the rate of 6 percent. Purchases subject to the Use Tax include appliances, books, clothing, computers, DVDs/CDs, electronics, furniture, pre-written computer software, and tobacco products.