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sales tax when buying apps online with iTunes card?

silverblack

silverblack

macrumors 68030
Original poster
Nov 27, 2007
2,680
840
I need to setup a US account to buy my first paid app (Keynote). I plan on bidding an iTunes card online, but don't know if Apple charges taxes, as I need to decide whether to get a $10 card, or a $15 card (for additional taxes).

Also, just to confirm, I can buy iPad apps using the iTunes cards right?
Thanks in advance!
 
silverblack said:
I need to setup a US account to buy my first paid app (Keynote). I plan on bidding an iTunes card online, but don't know if Apple charges taxes, as I need to decide whether to get a $10 card, or a $15 card (for additional taxes).

Also, just to confirm, I can buy iPad apps using the iTunes cards right?
Thanks in advance!
Click to expand...

that is correct, and there is no sales tax on any of the itunes, stuff. Books, Music, Movies, Apps.

Technically, they can't charge tax on intangible personal property, which downloaded software is considered. The only way to charge tax is if it came in a box.
 
Yes they do charge tax.

People need to read the ***** TOS before they write:

SALES TAX

iTunes Store transactions will include sales tax based on the bill-to address and the sales tax rate in effect at the time your transaction is completed. If the sales tax rate for the billing address changes before the purchased or rented (as applicable) digital content is downloaded, the new tax rate in effect at the time of download will apply. We will only charge tax in states where digital goods are taxable. No customers are eligible for tax exemptions for transactions made on the iTunes Store.
Click to expand...

http://www.apple.com/legal/itunes/us/terms.html
 
citi said:
Technically, they can't charge tax on intangible personal property, which downloaded software is considered. The only way to charge tax is if it came in a box.
Click to expand...

Makes you think of all the tax revenue states will be losing once all media (especially movies and video games, etc) are download-only, since consumer media is one of the highest grossing industries.
 
citi said:
that is correct, and there is no sales tax on any of the itunes, stuff. Books, Music, Movies, Apps.

Technically, they can't charge tax on intangible personal property, which downloaded software is considered. The only way to charge tax is if it came in a box.
Click to expand...

From what I have read what you say is untrue.

Some states get charged Tax in the app store and some states don't. I hear if the state has an Apple store you will get Taxed. You need to find a state that does not get charged tax and make an account using an address in that state.
 
I think it applies to all states. I was charged tax in NC and in CA.
 
I have been taxed on all purchases from the iTunes store. New York State here. A $0.99 app costs me $1.06. Tax is $0.07 where I'm at in Yonkers, NY.
 
States where you will be charged iTunes tax as of 4/2006 (looking for more updated data)

Alabama
Arizona
Colorado
Hawaii
Idaho
Indiana
Kentucky
Louisiana
Maine
New Mexico
South Dakota
Texas
Utah
Washington
West Virginia
Washington, D.C.

So no, you're wrong. It's not just the mid-USA.

Makes me want to return to some old billings of mine to see why I seem to think I was charged in CA and NC. Then again the article is outdated.

Apple, on the other hand, says they will charge tax and does not specify which state. Hard to argue with Apple's legal statement. :cool:
 
citi said:
that is correct, and there is no sales tax on any of the itunes, stuff. Books, Music, Movies, Apps.

Technically, they can't charge tax on intangible personal property, which downloaded software is considered. The only way to charge tax is if it came in a box.
Click to expand...

WRONG!

Sales tax is charged unless:

You live in a state that doesn't have sales tax.

PS your understanding of sales tax is also wrong.
Sales tax can be charged on intangible goods or services, depends on state law.

http://en.wikipedia.org/wiki/Sales_tax




@.jessica I think they charge sales tax in every state that Apple has a physical location. If the state has a sales tax. I live in MI and get charged sales tax from iTunes.
 
jessica. said:
States where you will be charged iTunes tax as of 4/2006 (looking for more updated data)

Alabama
Arizona
Colorado
Hawaii
Idaho
Indiana
Kentucky
Louisiana
Maine
New Mexico
South Dakota
Texas
Utah
Washington
West Virginia
Washington, D.C.

So no, you're wrong. It's not just the mid-USA.

Makes me want to return to some old billings of mine to see why I seem to think I was charged in CA.
Click to expand...

That's odd, since Washington , D.C. specifically does not tax digital content-

Washington D.C. – Has a sales tax only on data processing and information services which include the distribution of news or current information. However, the tax statute specifically disclaims sales of digital content and certain Internet related services. Title 47 §2001(n)(1)(N) & (n)(2)(G)

So unless they claim that all apps distribute news/current information..


Maybe you should find a more current list =)
 
I am in Texas and I was charged tax. It was more than just the state tax of 6.25% but less than my city's tax of 8.25%. I was charged roughly 7% tax on my purchase.
 
jessica. said:
Maybe you should, since you're wrong and all. :)

Rest assured, I doubt DC dropped off that list.

We can rule out Chicago.
http://www.chicagobreakingnews.com/...f-itunes-tax-still-backs-income-tax-hike.html
Click to expand...

Since I gave you a title name and everything, I'm sure it's off the list. Unless you can provide proof that they went in and changed it.


Anyway- to answer OP. I guess it just depends where you live. I live in California (and have the most physical locations of Apple Stores in the US) and I do not get charged sales tax
 
I can play that too. ;) You are in fact my HOTD (that's hero of the day). Seriously.
 
No tax on songs I've purchased from the iTunes store. I just checked my receipts and all songs and albums, no tax. There was tax charged to at least 2 apps(games) I bought for my iPhone. Looks like it's just apps that get charged tax. Can't attest to books tho. :)
 
bytethese said:
No tax on songs I've purchased from the iTunes store. I just checked my receipts and all songs and albums, no tax. There was tax charged to at least 2 apps(games) I bought for my iPhone. Looks like it's just apps that get charged tax. Can't attest to books tho. :)
Click to expand...

Nope. I have apps but no tax. Maybe the developers of the apps were located in your state?
 
skubish said:
WRONG!

Sales tax is charged unless:

You live in a state that doesn't have sales tax.

PS your understanding of sales tax is also wrong.
Sales tax can be charged on intangible goods or services, depends on state law.

http://en.wikipedia.org/wiki/Sales_tax




@.jessica I think they charge sales tax in every state that Apple has a physical location. If the state has a sales tax. I live in MI and get charged sales tax from iTunes.
Click to expand...

It does depend on state law, some states collect on internet purchases, when they really shouldn't be. It should only be applied to shipped physical goods, not software.

You need to understand the sales tax law before spouting off nonsense. I WORK FOR THE CA STATE BOARD OF EQUALIZATION.

I am in California, HEADQUARTERS to Apple and I don't get charged sales tax. You are wrong.

Oh and please don't use WIKIPEDIA as the basis for your argument

Here is CALIFORNIA LAW - REGULATION 1502

Products electronically transmitted to customers
Your sale of electronic data products such as software, data, and digital images is generally not taxable when you transmit the data to your customer over the Internet or by modem. However, if as part of the sale you provide your customer with a printed copy of the electronically transferred information or a backup data copy on a physical storage medium such as a CD-ROM, your entire sale is usually taxable.
For example, if your company sells canned (noncustom) software programs to customers who download them from a server, those sales are generally not subject to tax. However, if you also provide your customers with a backup copy on a CD-ROM, the entir e transaction is taxable. Similarly, if you transmit a stock (noncustom) database to your customer over the Internet and also provide a printed copy of the contents, the entire sale is subject to tax.
For more information regarding the sale of computer programs and data processing services, you may wish to obtain a copy of Regulation 1502, Computers, Programs, and Data Processing.

Software is considered intangible, a box with a disc in it is not.
 
bytethese said:
No tax on songs I've purchased from the iTunes store. I just checked my receipts and all songs and albums, no tax. There was tax charged to at least 2 apps(games) I bought for my iPhone. Looks like it's just apps that get charged tax. Can't attest to books tho. :)
Click to expand...

I just bought an album and 2 apps and was charged tax on the entire purchase. I don't care though...death and taxes ya know. :rolleyes:
 
Tax or no tax... Credit card vs. iTunes dollars?

When you buy an iTunes card in store, don't you pay the taxes already? Is it possible that tax is charged when purchasing apps with credit card, but no tax with iTunes dollars?
 
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