Tax & AccountingMarch 27, 2018|UpdatedDecember 01, 2020
Sales & Use Tax Foundations (Part 9) — Refunds and Credits
Part IX: Basic questions and answers about state sales and use tax: Refunds and credits
In our last blog, Part VIII: Basic Questions and Answers about State Sales and Use Tax: Returns and Payments, we focused on the eighth of our foundational sales and use tax topics — tax return filing and tax payments, aimed primarily at the non-tax specialist, who is often challenged by the complexities of sales and use taxation. In this blog, we ask and answer a basic question about the topic — how are tax refunds and credits handled?
Sales and use tax refunds and credits — In general
Question 1: How are refunds and credits handled?
Every state with a sales tax also provides for either a refund or credit of the tax due for overpayments in the case of bad debts, repossessions, returned goods, or computational mistakes resulting from matters of fact or law.
Credits. Although each state’s credit procedure would be different, all states provide that a taxpayer may request a credit memorandum for excess tax payments within a certain number of days of the date of payment. Then, if no request is made, the taxpayer would credit the excess payment against tax liability subsequently to be remitted.
Refunds. A refund claim must be filed generally within three years from the due date of the return for which the overpayment is alleged. However, each state’s time frame for filing a claim may vary.
Actions by sellers and purchasers against each other. State tax laws, as well as state laws on debt collection need to be researched to determine whether sellers and purchasers may bring actions against each other to recover erroneously paid sales taxes.
Sales and use: Refunds and credits — State-specific rules
Chart One: Refunds
| Refunds: Can a purchaser file a refund with state where tax on purchase was collected and remitted by a seller. | |||
| Jurisdiction | Customer Refund Claims | Comment | Citation |
| Alabama | Allowed | Ala. Code §40-2A-7 | |
| Ala. Admin. Code r. 810-14-1-.18 | |||
| Arizona | Not allowed | Transaction privilege tax is imposed on seller. | Ariz. Rev. Stat. §42-1118 |
| Arkansas | Allowed | Vendor must assign the right to claim refund to the customer. We recommend you reference cited authority for more information. | Ark. Reg. GR-81 |
| California | Not allowed | Cal. Rev. & Tax Code §6901 | |
| Colorado | Allowed | Colo. Rev. Stat. §39-26-703 | |
| Connecticut | Allowed | Retailer must waive right to file refund claim. We recommend you reference cited authority for more information. | Policy Statement 98(5) |
| District of Columbia | Allowed | D.C. Code Ann. §47-2020(a) | |
| District Paving Corp. v. District of Columbia | |||
| Florida | Not allowed | Fla. Admin. Code Ann. r. 12A-1.014(4) | |
| Georgia | Allowed | Allowed in certain instances where the dealer has refused or was unable to refund tax and has waived the right to file a refund claim. We recommend you reference cited authority for more information. | Ga. Code Ann. §48-2-35.1(d) |
| Hawaii | Not allowed | General excise tax is imposed on seller. | Haw. Rev. Stat. §231-23 |
| We recommend you reference cited authority for more information. | |||
| Idaho | Allowed | If the purchaser provides evidence that the vendor has refused to refund the tax, the purchaser may file a claim for refund directly with the Tax Commission. We recommend you reference cited authority for more information. | IDAPA 35.01.02.117 |
| Illinois | Allowed | 35 ILCS 105/19 | |
| Indiana | Allowed | A purchaser may file a refund claim if the retailer has refused to refund the tax. | Ind. Code §6-2.5-6-13 |
| Iowa | Allowed | Iowa Admin. Code r. 701-12.9 | |
| Kansas | Allowed | Allowed for certain claims over $50 where the consumer directly paid the tax, or the retailer refused to refund the tax or waived the right to file a refund claim. We recommend you reference cited authority for more information. | Kan. Stat. Ann. §79-3650 |
| Kentucky | Not allowed | We recommend you reference cited authority for more information. | Ky. Rev. Stat. Ann. §139.770 |
| Louisiana | Allowed | The purchaser may file a refund application only if the retailer has refused to or is unable to issue a refund. We recommend you reference cited authority for more information. | La. Rev. Stat. Ann. §47:1621 |
| Unofficial Department Guidance | |||
| Maine | Allowed | The purchaser may file a refund application only if the retailer has refused to issue a refund. | Me. Rev. Stat. Ann. tit. 36, §2011 |
| App-153 Sales, Fuel & Special Tax Division Request for Sales Tax Refund | |||
| Maryland | Allowed | Purchaser may make a refund claim subject to certain statutory conditions. | Md. Code Ann. §13-901 |
| We recommend you reference cited authority for more information. | |||
| Massachusetts | Not allowed | Mass. Regs. Code tit. 830, §62C.26.1(17) | |
| Mass. Regs. Code tit. 830, §62C.37.1(6) | |||
| Michigan | Not allowed | Customers may request a refund from the department only if the business has ceased operations. Beginning January 1, 2019, a purchaser that failed to claim a sales and use tax exemption at the time of purchase may claim a refund from the Michigan Department of Treasury. | Mich. Comp. Laws §205.60 |
| Mich. Comp. Laws §205.52; | |||
| We recommend you reference cited authority for more information. | Unofficial Department Guidance | ||
| Minnesota | Allowed in certain circumstances | Customers may request a refund from the state only if the amount exceeds $500 and the customer is registered with the department. Purchasers are limited to two refund claims per year. | Minn. Stat. §289A.50 |
| Refunds cannot be issued for sales for resale if the vendor has a published no resale policy. | |||
| We recommend you reference cited authority for more information | |||
| Mississippi | Not allowed | Miss. Code. Ann. §27-73-3 | |
| Miss. Code. Ann. §27-65-53 | |||
| Missouri | Allowed | A direct claim may be made by the purchaser subject to certain statutory conditions. | Mo. Rev. Stat. §144.190 |
| Nebraska | Allowed | No refund is allowed unless claim is filed with Tax Commissioner. Purchaser may not seek refund from seller. | Neb. Rev. Stat. §77-2708 |
| Neb. Admin. Code §1-110 | |||
| We recommend you reference cited authority for more information. | |||
| Nevada | Allowed | Customer may only seek refund from the state if an attempt has first been made to obtain refund from the vendor. | Nev. Admin. Code §360.492 |
| New Jersey | Allowed | N.J. Stat. Ann. §54:32B-20 | |
| New Mexico | Not allowed | N.M. Stat. Ann. §7-9-3.5 | |
| Unofficial Department Guidance | |||
| New York | Allowed | N.Y. Tax Law, §1139(a) | |
| North Carolina | Not allowed | Sales and Use Tax Technical Bulletin, Sec. 34-21 | |
| North Dakota | Allowed | N.D. Cent. Code §57-39.2-24 | |
| Ohio | Allowed | We recommend you reference cited authority for more information. | Ohio Rev. Code Ann. §5739.07 |
| Ohio Admin. Code §5703-9-07 | |||
| Oklahoma | Allowed | We recommend you reference cited authority for more information. | Okla. Stat. tit. 68, §1354.26 |
| Pennsylvania | Allowed | 72 P.S. §10003.1 | |
| Rhode Island | Allowed | In most instances, customer receives refund from retailer. | Unofficial Department Guidance |
| South Carolina | Allowed | Purchaser may make a claim only if the seller has assigned the right to the refund in writing. | S.C. Code Ann. §12-60-470 |
| We recommend you reference cited authority for more information. | |||
| South Dakota | Not allowed | Unofficial Department Guidance | |
| Tennessee | Not allowed | Persons receiving disaster assistance from FEMA may claim a refund of sales and use tax paid on eligible items used to repair or replace damaged items in the primary residence. We recommend you reference cited authority for more information. | Tenn. Code. Ann. §67-6-538 |
| Tenn. Code. Ann. §67-6-396 | |||
| Tenn. Comp. R. & Regs. 1320-5-1-.79 | |||
| Texas | Allowed | Only permitted purchasers may file a refund claim with the Comptroller. Non-permitted purchasers may not file a direct refund claim unless the permitted seller has assigned its right to refund to the purchaser. We recommend you reference cited authority for more information. | 34 Tex. Admin. Code §3.325 |
| Utah | Allowed | Utah Code Ann. §59-12-110.1 | |
| Vermont | Allowed | Vt. Stat. Ann. tit. 32, §9781 | |
| Virginia | Allowed | Consumer must first apply for refund with the dealer. | 23 Va. Admin. Code §10-20-180(A)(2) |
| Washington | Allowed | A buyer may file a claim when the seller has gone out of business, is financially insolvent, cannot be located, or refuses to refund the tax but acknowledges it should not have been collected. | Wash. Rev. Code §82.32.060 |
| We recommend you reference cited authority for more information. | |||
| West Virginia | Allowed | We recommend you reference cited authority for more information. | W. Va. Code §11-15B-29 |
| W. Va. Code R. §110-15F-19 | |||
| Wisconsin | Allowed | Wis. Stat. §77.59(4) | |
| Wyoming | Not allowed | Wyo. DOR Rule Ch. 2, §10 | |
Chart 2: Credits
| State | Tax Credits |
| Alabama | Taxpayers who paid a legally imposed sales or use tax to another state or any of its subdivisions may claim a credit against the Alabama use tax due, regardless of whether that jurisdiction allows a credit for sales and use taxes paid to Alabama or its subdivisions. The credit must be applied first against the amount of any use tax due the state, and any unused portion of the credit is then applied against the amount due a subdivision. (Ala Admin Code r. 810-6-5-.04 ) Reciprocal credit is also offered within Alabama for county and municipal sales tax, gross receipts tax in the nature of a sales tax, use tax, and rental tax on a “city to city” and “county to county” basis. (Ala Admin Code r. 810-6-5-.04.01 ) |
| Arizona | Taxpayers are entitled to credits for excess taxes paid. ( Sec. 42-1118, A.R.S.) |
| Arkansas | Arkansas has adopted the sales and use tax credit provisions under the Multistate Tax Compact. Purchasers liable for use tax on tangible personal property are entitled to full credit for sales or use taxes paid to another state on the same property. The credit shall be applied first against the amount of any use tax due the state, and any unused portion of the credit shall then be applied against the amount of any use tax due a subdivision. For credit purposes, the Arkansas gross receipts tax is synonymous with sales tax. ( Sec. 26-5-101 ( Art. V), A.C.A.) |
| California | A credit is allowed against California use tax for sales or use taxes paid to another state prior to the use, storage, or consumption of the property in California. California does not provide a credit in the form of a prompt payment discount for collection of the tax. A credit or refund is also allowed for erroneous or overpaid taxes. ( Sec. 6901, Rev. & Tax. Code; Sec. 6901.5, Rev. & Tax. Code) |
| Colorado | The amount of sales or use tax paid to another state on the purchase or use of tangible personal property in that state is allowed as a credit against any use tax imposed on that property in Colorado. ( Sec. 39-26-709(1)(f), C.R.S., ¶96-170h; Reg. 39-26-203.1(k), |
| Connecticut | Use tax credits are allowed in many instances for sales taxes paid to other states or counties. If sales or use tax has been paid to another state or political subdivision, a credit is effectively allowed for such payment by reducing the applicable Connecticut tax rate by the rate of tax of the other state. A credit (in lieu of a refund) may be obtained for the same grounds and under the same circumstances that would justify filing a claim for refund. |
| DC | When a refund is due a taxpayer, a credit is allowed for any payments due from the taxpayer. ( Sec. 47-2020, ¶92-594; Sec. 47-2213, D.C. Code, ¶92-658) |
| Florida | Credit is provided in Florida for a like tax paid in another state for the use or consumption of services, or the use, consumption, distribution, or storage of tangible personal property in Florida up to the amount of tax imposed in Florida. The dealer must pay the Florida Department of Revenue the difference between the tax imposed by Florida and any lesser tax imposed in the other state. ( Sec. 212.06(7), F.S.; Rule 12A-1.091(3)) |
| Georgia | Under specific conditions, a reciprocal credit is permitted against Georgia use tax due. The other jurisdiction must allow a reciprocal credit for Georgia sales or use taxes paid, and the purchaser must have legally owed and paid a sales or use tax to the other jurisdiction and have no right to a refund or credit. The reciprocal credit is available if the amount of taxes paid to the other state or to a local jurisdiction is less than the amount of taxes imposed by Georgia or a different local jurisdiction. ( O.C.G.A. Sec. 48-8-42(a) ; Reg. Sec. 560-12-1-.32(3) ; Policy Statement SUT 2011-05-25, Georgia Department of Revenue, May 25, 2011 ) The reciprocal credit for state taxes only applies to outside state taxes paid prior to Georgia state tax becoming due and not to taxes subsequently paid in destination states. ( National Service Industries, Inc. v. Hawes, Supreme Court of Georgia, 227 Ga. 221, 179 S.E.2d 765, January 8, 1971; reh’g den. January 29, 1971) The reciprocal credit for local taxes applies to taxes paid to a local jurisdiction in Georgia, and to taxes paid to an out-of-state local jurisdiction. (See Policy Statement SUT 2011-05-25, Georgia Department of Revenue, May 25, 2011 ) |
| Hawaii | If excess tax is paid, taxpayers may elect a credit against later taxes instead of a refund. ( Haw Rev Stat Sec. 237-37 , Haw Rev Stat Sec. 238-7 ). However, no overpayment credit will be made unless the original payment of the tax resulted from the law being interpreted or applied to the taxpayer differently than to taxpayers in general. ( Haw Rev Stat Sec. 231-23(a)(1)(C) ; Haw Rev Stat Sec. 238-7 ; Haw Rev Stat Sec. 237-37 ) |
| Idaho | Idaho use tax is not imposed on property that has been subjected to a general retail sales or use tax by another state in an amount equal to or greater than the amount of Idaho tax, but is imposed to the extent that the amount of Idaho tax exceeds the amount of tax paid to the other state. ( IC Sec. 63-3621(j) ; Rule 35.01.02.072.07 ). If a person makes an overpayment of tax, the excess amount may be credited against any amount then due to the State Tax Commission and any balance may be refunded, provided the person files a written claim for credit or refund with the Commission within three years from the time the payment was made. ( IC Sec. 63-3626(a) ) |
| Indiana | A person who has paid any sales, purchase, or use tax to any other state, territory, or possession of the United States is entitled to a credit against the Indiana use tax equal to the amount paid on the same item of tangible personal property. ( IC 6-2.5-3-5 ; 45 IAC 2.2-3-16 ) |
| Illinois | A taxpayer may request a credit memorandum for excess tax payments within 30 days of the date of payment. If no request is made, the taxpayer may credit the excess payment against tax liability subsequently to be remitted. ( 35 ILCS 105/9, ¶97-550; 35 ILCS 120/3, ¶100-640) |
| Iowa | A credit is granted for comparable sales or use taxes paid to other states up to the amount of the Iowa liability. ( Sec. 423.3(36), Code of Iowa ) |
| Kansas | With respect to items purchased outside Kansas that are later used in Kansas, if an article of tangible personal property purchased at retail is subject to sales or use tax by another state at a rate lower than the Kansas rate, a credit is provided under Kansas law for the payment of the taxes. The procedures for claiming a credit are the same as for claiming a refund. ( Sec. 79-3609(b), K.S.A. ; K.A.R. 92-19-49b ). |
| Kentucky | Taxpayers and certified service providers (CSPs) are not entitled to a refund or credit of sales or use taxes collected from a purchaser, unless the collected amount is refunded to the purchaser by the taxpayer or CSP who paid over the taxes to the state. (See KRS Sec. 139.770(3) ) |
| Louisiana | Use tax credits are allowed in many instances for sales taxes paid to other states or counties. |
| Maine | Where, upon written application by a taxpayer or during the course of an audit, the State Tax Assessor determines that any tax had been paid more than once or has been erroneously or illegally collected or computed, the amount collected in excess of that legally due, with interest at the specified rate, is to be credited on any taxes then due from taxpayer and the balance refunded. ( 36 M.R.S.A. Sec. 2011 ) Unless the taxpayer specifically requests a cash refund, the State Tax Assessor may credit the refund amount to the taxpayer’s sales and use tax account. In such cases, however, no further interest accrues from the date of the election to credit the refund amount. |
| Maryland | There is no system for crediting sales and use taxes paid to other states. However, since the law does not tax the use of property or service purchased in another state when the buyer has already paid a sales or use tax in that state before bringing the property or service into Maryland, the arrangement has the same effect as a credit against the taxpayer’s Maryland use tax liability. If the tax paid to the other state is less than the Maryland sales and use tax, a proration formula applies. ( Sec. 11-221(c), Tax General Art. ) |
| Massachusetts | Massachusetts does not allow vendors a credit or deduction as compensation for collecting and remitting sales and use taxes. Instead, Massachusetts allows a use tax exemption for sales upon which the purchaser has paid a tax to a vendor or retailer under the laws of any U.S. state or territory. ( Sec. 7(c), Ch. 64I, G.L. ) |
| Michigan | Michigan exempts from use tax property on which sales or use tax equal to or in excess of that imposed by Michigan has been paid to another state or local government, provided the other state or local government extends a reciprocal exemption to Michigan. If the tax paid was less than what Michigan would have imposed, the difference is paid to Michigan. ( Sec. 205.94(e), M.C.L. ). However, under the Multistate Tax Compact as adopted by Michigan, each purchaser liable for use tax on tangible personal property is entitled to a credit for the amount of sales or use taxes paid to another state and/or political subdivision of such state with respect to the same property. ( Sec. 205.581, M.C.L. ). Research is needed to determine which rule applies. |
| Minnesota | A credit for comparable sales or use taxes paid to other states is allowed, in an amount up to the amount of the Minnesota tax liability. The credit is applied first against the amount of any use tax due the state, and any unused portion of the credit must then be applied against any use tax due a political subdivision. ( Sec. 297A.80, Minn Stats.). The credit is not allowed if the tax paid in the other state is subject to refund or was erroneously paid. Furthermore, the credit is not allowed for taxes paid to a foreign country. ( Rule 8130.4400 Minn Rules) |
| Mississippi | Use tax credits are allowed in many instances for sales taxes paid other states or counties. Persons using business property in this state that has been used by them in other states are entitled to a credit for sales and use tax that was paid to other states. The amount of the credit is equal to the aggregate of all such state rates multiplied by the value of the property at the time of importation into Mississippi. ( Miss Code Ann Sec.27-67-7(a) ). Persons using business property in Mississippi that was acquired from another person who used it in other states are entitled to a credit equal to the applicable rate in the state of last prior use multiplied by the value of the property at the time of importation into Mississippi. However, the credit for use tax paid to another state does not apply to personal property that was only stored or warehoused in such other state and first used in Mississippi. ( Miss Code Ann Sec.27-67-7(a) ). |
| Missouri | Use tax is not imposed on property that has been subjected to tax by another state except to the extent the use tax imposed in Missouri exceeds the tax imposed in the other state. ( Sec. 144.615(5), RSMo ; 12 CSR 10-4.100 ) |
| Nebraska | Nebraska use tax is not imposed on property or service brought into Nebraska if it has been subjected to a sales or use tax by another state at a rate equal to or greater than the Nebraska rate and if the other state grants a reciprocal exclusion or exemption. However, use tax is imposed to the extent that Nebraska’s rate exceeds the other state’s rate. The credit is first applied against the use tax due the state, and secondly to the use tax due a Nebraska municipality or county that imposes a local tax. ( Sec. 77-2704.31, R.S. ; Reg.1-071 ; Reg. 1-002.02B ; Information Guide 6-317-1992: Consumer Use Tax (Rev. 12-11), Nebraska Department of Revenue, December 1, 2011 ) |
| Nevada | In determining the amount of use tax that is due from a taxpayer, the department will allow a credit in an amount equal to sales tax paid for the same purchase of tangible personal property to a state or local government outside Nevada. ( NAC 372.055, ¶64-053). A credit against sales tax collected is given in the form of a collection allowance. ( NRS 372.370, ¶92-135; NRS 374.375). |
| New Jersey | If a retail sales or use tax equal to or greater than the amount of the New Jersey tax is paid to another state or jurisdiction without any right to a refund or credit, the property that is the subject of the tax is not subject to the New Jersey use tax when imported for use or consumption in New Jersey. If the New Jersey tax rate is higher than the tax rate of the other state or jurisdiction, the new Jersey tax is imposed on the difference. No exemption is allowed for property or services on which a tax has been paid to another state or jurisdiction, unless the other state or jurisdiction allows a corresponding exemption when a sales or use tax is paid to New Jersey. (N.J.S.A. Sec. 54:32B-11(6) ) |
| New Mexico | A credit against New Mexico gross receipts tax is available for sales taxes paid to another state or the state’s political subdivision on services performed in the other state. ( NM Stat Ann Sec. 7-9-79.1 ) The amount of the credit is limited to the product of the New Mexico gross receipts tax rate multiplied by the amount of receipts subject to tax by both New Mexico and the other state or political subdivision. |
| New York | If a vendor is registered for sales tax purposes, it can claim a credit for sales taxes overpaid, paid by mistake, or collected but then repaid to customers. The vendor can then apply the credit to reduce the tax they owe on their sales tax return. (TB-ST-810) |
| North Carolina | Credits are allowed for sales or use taxes due and paid to another state ( Sec. 105-164.6(c)) and taxes paid on products that have been returned to the retailer. ( Sec. 17:07B.3003, N.C. Adm. Code). |
| North Dakota | If sales or use tax has already been paid to another state at a lower rate, North Dakota allows a credit such that the use tax applies to the difference between the North Dakota use tax rate and the rate paid to the other state, if the other state allows a similar credit for sales or use tax paid to North Dakota. ( Sec. 57-40.2-11, NDCC ) The reduced use tax is calculated by subtracting the rate of tax paid to the other state from the North Dakota use tax rate multiplied by the fair market value of the property being taxed. ( Guideline, Out of State Retailers, North Dakota Office of State Tax Commissioner) |
| Ohio | Use tax credits are allowed in many instances for sales taxes paid other states or counties. |
| Oklahoma | Use tax credits are allowed in many instances for sales taxes paid to other states or counties. Oklahoma law provides an exemption equal to any tax paid by the person using tangible personal property in Oklahoma under the laws of some other state. In cases in which the sales tax is paid out of state, the Oklahoma use tax applies only to the extent that the other tax paid is lower than the Oklahoma use tax. ( 68 O.S. Sec. 1404(3) ; Rule 710:65-21-20(3) ). |
| Pennsylvania | Credit is allowed for taxes paid to another state on tangible personal property and services purchased for use in that state and later brought into the Commonwealth, provided the other state grants substantially similar credit to Pennsylvania residents. (Sec. 206, Act of March 4, 1971, P.L. 6, [72 P.S. §7206]; Reg. Sec. 31.2(4); Reg. Sec. 31.7(b)). A credit in the form of a prompt payment discount is given for collection of the tax. |
| Rhode Island | Taxpayers, when computing the use tax due on an article brought into Rhode Island for use, storage or other consumption therein, may credit the amount of the sales or use tax which they were lawfully obligated to pay and paid in another taxing jurisdiction on such article. ( RI Gen Laws Sec. 44-18-30A; Reg. SU 87-29) |
| South Carolina | The amount of state and local sales or use tax paid to another state on the purchase of tangible personal property in that state is allowed as a credit against any use tax imposed on that property in South Carolina. ( Sec. 12-36-1310(C), S.C. Code ) If the South Carolina use tax is more than the tax imposed in the other state, the user must pay the difference to the Department of Revenue. |
| South Dakota | Credit is allowed against South Dakota use tax for sales and use tax previously paid by the taxpayer to another state or its political subdivisions with respect to the same property or services. ( Sec. 10-46-6.1, SDCL ; Sec. 10-46-34.1, SDCL ; ARSD 64:06:01:34 ) However, no credit is allowed if the other state or its political subdivision does not grant a reciprocal credit for similar property in South Dakota. |
| Tennessee | A credit is allowed against Tennessee use tax for sales or use tax paid in another state on tangible personal property or taxable services imported into Tennessee. ( Sec. 67-6-507(a), T.C.A.; Rule 1320-5-1-.91) |
| Texas | A credit in the form of a prompt payment discount is given for collection of the tax. As a member of the Multistate Tax Compact, Texas allows as a credit against Texas use tax any combined amounts of legally imposed sales and use taxes paid on the same property to another state or a political subdivision of another state, if such other state provides a similar credit for Texas taxpayers. The credit is allowed even if the other state is not a member of the Multistate Compact. ( Sec. 151.303(c), Tax Code ; 34 TAC Sec. 3.338(b) ; 34 TAC Sec. 3.346(c)(4) ). |
| Utah | Use tax credits are allowed in many instances for sales taxes paid other states or counties. A credit in the form of a prompt payment discount is given for collection of the tax. |
| Vermont | A use tax exemption/reciprocal credit is allowed when sales or use tax has been paid to another state, provided that the other state allows a corresponding credit for the Vermont tax. To the extent that the Vermont tax is imposed at a higher rate than the rate of tax in the first taxing jurisdiction, this exemption/credit is inapplicable, and the use tax imposed by Sec. 9773, Tit. 32, V.S.A. applies to the extent of the difference in the rates. ( Sec. 9744(a)(3), Tit. 32, V.S.A. ; Ruling 2000-01, Vermont Department of Taxes, January 5, 2000. |
| Virginia | A credit is allowed for sales or use tax paid in another state for tangible personal property used in Virginia. The amount of the credit may not exceed the amount of the Virginia tax. This credit does not require that the state of purchase grant a similar credit for tax paid to Virginia. The credit does not apply to tax erroneously paid to another state. For example, if a person takes delivery in Virginia of tangible personal property purchased from an out-of-state dealer who incorrectly charges out-of-state tax, no credit is available; instead, the purchaser must apply to the dealer for a refund. ( Sec. 58.1-611, Code ; 23 VAC 10-210-450 ) |
| Washington | A credit against use tax for the use of tangible personal property, extended warranty, digital good, digital code, digital automated service, or service defined as a retail sale in RCW 82.04.050(2)(a) or (g), (3)(a), or (6)(b) in Washington is allowed in the amount of sales or use tax that was paid by the user or his or her bailor or donor with respect to the property, extended warranty, digital good, digital code, digital automated service, or service to any other state, possession, territory, or commonwealth of the United States, any political subdivision thereof, the District of Columbia, and any foreign country or political subdivision thereof. ( RCW 82.12.035 ; WAC 458-20-178(8) ). |
| West Virginia | A credit against use tax is allowed for sales tax paid to another state up to the amount of the use tax imposed on the use of the property in West Virginia. ( W.Va. Code Sec. 11-15A-10a ; Reg. Sec. 110-15-43 ) |
| Wisconsin | When the purchase, rental, or lease of tangible personal property or a service subject to Wisconsin use tax was subject to a sales tax by another state where the purchase was made, the amount of the sales tax paid the other state may be claimed as a credit against the Wisconsin use tax. For purposes of this credit, “sales tax” includes a use or excise tax imposed on the use of tangible personal property or a taxable service by the state in which the sale occurred, and “state” includes the District of Columbia and the commonwealth of Puerto Rico but does not include the several territories organized by Congress. The amount of the credit may not exceed the amount of Wisconsin use tax otherwise due. ( Sec. 77.53(16), Wis. Stats. ) |
| Wyoming | An offset credit against Wyoming use tax is allowed for sales or use tax paid to another state on the purchase of property. (Rule Ch. 2, Sec. 3(h), Wy DR). Erroneously paid sales or use tax, penalties, or interest will be credited against the taxpayer’s subsequent tax liability or may be refunded. Vendors who refund sales taxes to a purchaser on returned goods may claim a credit on their tax return for the refund. (Rule Ch. 2, Sec. 5(f), Wy DR) |
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