Sacramento Corporate Excise Tax Accountant
Cook CPA Group
Excise taxes are taxes that are levied for the sale of specific goods and services. They are not paid by the individuals purchasing them but are rather paid by the producer or seller of that item. The cost of the excise tax is, however, often reflected in the sale price of the item.
If you are interested in learning more about how your business can use Cook CPA Group’s services to pay corporate excise taxes, get in touch as soon as possible. Call (916) 432-2218 to schedule a free and confidential consultation with the Sacramento corporate excise tax accountants as Cook CPA Group.
What the Excise Tax Means for Your Corporation
Excise taxes are levied on specific goods and services (they are also sometimes referred to as “duties”). They are paid by the entity that produces or sells the item, which makes it different from a sales tax, which is paid by the person purchasing the item. Products that businesses must pay excise taxes on include cigarettes, alcohol, environmental products, air transportation, fuels used for business, trucks and trailers, coal, tires, sport fishing equipment, and hunting bows.
Excise taxes are a type of trust fund tax, which means that after a business pays them, they are held in a trust and then paid to the IRS at certain times. If the full amount of the tax remains unsubmitted at the time that it is due, then the business may face a trust fund recovery penalty.
Excise taxes are generally paid using Form 720, though certain industries use other forms. It can be filed either by mail or through the Electronic Federal Tax Payment System (EFTPS), the free system for paying federal taxes created by the Department of Treasury. Excise taxes are due one month after the end of each financial quarter. More information about filing and paying excise taxes can be found in Publication 510, the guide to excise taxes issued by the IRS.
Excise Taxes with Special Conditions
Sacramento businesses in certain industries are subject to specific excise taxes. The following are excise taxes that include special exceptions.
- Indoor tanning bed providers – Indoor tanning beds are subject to higher excise taxes than other products. This excise tax has been in place since 2010 as part of the Affordable Care Act. All tanning services (defined as a service that employs the use of any electronic product that incorporates ultraviolet lamps intended for irradiation by ultraviolet light to induce skin tanning) must pay a 10% excise tax.
- Sports wagering – Sports wagering is subject to federal excise taxes, whether or not sports wagering is permitted by the state where it occurs. Wagering that is authorized by the state is subject to an excise tax of 0.25% of the amount that was wagered, along with an annual occupational tax that costs $50 for each agent that accepts wagers. Wagering that is not authorized by the state is subject to an excise tax of 2%, as well as an annual occupational tax of $500 for each agent that accepts wagers. In addition to Form 720, businesses that offer sports betting must also file Form 730, which is a monthly tax return for wagers, as well as Form 11-C, an occupational tax, and registration return.
It should also be noted that certain products and services are exempt from excise taxes. Since 2017, certain payments related to the management of private aircraft made by aircraft owners or lessees are exempt from the excise tax normally levied on air transportation. Services necessary to support a flight operated by the owner or lessee of the aircraft are exempt from excise taxes; these services include storage, maintenance, and fueling of the aircraft, as well as the costs for pilots, scheduling, flight planning, weather forecasting, insurance, and other administrative services necessary to the operation of flights.
Forms Needed to Pay Corporate Excise Taxes in Sacramento, CA
Most businesses that are required to pay an excise tax in Sacramento will use Form 720 to pay the tax. However, there are other forms that businesses may use to pay for related excise taxes. The following are forms that businesses may use to file these taxes.
- Form 720 – This form covers a broad category of taxes, including environmental taxes, fuel taxes, communication, and air transport taxes, taxes on the sale of trucks and trailers, and manufacturer taxes on various articles. It can be used to both report and pay the liability on those products and may also be used to claim credits, if applicable.
- Form 2290 – This form is used to pay excise taxes on the use of trucks, tractors, and buses on public highways.
- Form 730 – If your business accepts wagers or conducts betting pools, you will have to use this form to figure out the taxes on the wagers your business accepts and conducts. Form 11-C is another used by businesses that accept or conduct wagers and is used to register the federal occupational tax.
Sacramento Excise Tax Accountants Available Today
Contact an experienced Sacramento tax accountant if your business needs help preparing your excise taxes. Cook CPA Group recognizes the challenges that may be presented along the way and is adept at finding solutions. If you would like to schedule a time for a free consultation, call (916) 432-2218 today.