My last equipment lease turned into a sales tax nightmare. The price in the lease documents included the state sales tax, that was fine with the original leasing company, but they were bought out by Citibank and I noticed a raise in the monthly payments, it was because they were charging sales tax on the monthly payments. told them that the original lease included sales tax, they told me they always charge for sales tax for monthly payments because they could, asked my accountant, he said yes they could do this then charged me $200 for reading the contract. That was fine until we moved our studio, this town charged a use fee for all equipment, where other towns and states allow you to depreciate use fees on equipment, this town charged full price for as long the lease was in effect. So I was paying $700 a year on a $10000 lease while the guy I worked with maxed out his credit card for his $10000 equipment purchase ended up paying under $100 per year. My accountant told me this was just a bad town to have a lease in. To make this all worse CitiBank called me a year after closing the lease to get more tax $ for the last year, I didn't have the lease. They said the town I had been in was asking them for it. I had closed the business and taken a paying job in another state. Business had become too complex for me in a sole proprietorship.
Tom
Bookmarks