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How Do Moving Companies Charge Sales Tax? – Ultimate Guide

Published on 2022-07-21

How Do Moving Companies Charge Sales Tax? - Ultimate Guide

Taxes can be a tricky subject in the moving industry. There are a lot of state-specific rules that are tied to the taxes that get imposed on customers of moving companies. Are you curious and searching for “Do moving companies charge sales Taxes?” on the web. While you will be able to find out all of the information about specific taxes that may incur on your move within your quote, generally speaking, taxes depend on a lot of factors.

No, the majority of movers do not include sales tax in the price of their moves. Services like loading, packing, and transportation are tax-free. In light of this, moving companies will likely collect sales tax on any packing supplies (like boxes and tape).

Factor #1: State Movers Sales Tax

As a general rule, when moving within the same state or even locally, moving companies are exempt from sales tax. This means that if you move within the same state or locally, you should not be charged a sales tax.

However, like every rule, there is an exception. States like Iowa, Wyoming, and Mississippi impose taxes on moving services that are used for “house and building” moves, but this is only for local moves using a moving service.

West Virginia imposes sales tax on any residential moving service.

Using Storage Services

The states also have rules when it comes to collecting sales tax on storage units. If the home you are moving into is not ready for your belongings and you are forced to put them into storage until it is, as long as the time is more than 30 days, you will not have to pay sales tax.

New York does not impose a tax on self-storage sales tax units, but they impose a tax on the service of providing a unit.

Florida imposes taxes on self-storage units.

Iowa also taxes self-storage units like Florida. However, they are exempt from this tax if they are a part of an apartment complex and only intended for tenant usage.

The state of Louisiana charges sales tax on moving services based on what is being put in the storage unit. Items like cars, clothing, rugs, and other tangible goods are considered taxable.

Moving services charges sales tax on items

Factor #2: Items

While a moving company may not charge you sales tax on your move, they do have the right to charge you sales tax for any type of item you may buy that can be used to pack items. Things like tape, boxes, bubble wrap, and tarps are items that are often placed under a sales tax.

International Duty

When moving internationally, it is essential to understand the way that customs works. Your moving company will work through all of it with you ahead of time, but when moving items into another country, you need to be prepared to pay a duty. You may also hear the term referred to as a tariff.

If you have ever gone through customs, you have to claim anything that you are bringing into that specific country. The agents will then determine if you are required to pay a duty, or tax, on that item. If it is determined that a duty is due, you must pay this before you can bring the item or items into the country.

Your moving company will have all of this taken care of for you ahead of time. The customs paperwork will need to be filled out. When bringing a car into another country, like Canada, you need to have the title and paperwork at the entry point three days in advance.

An international move is a time when you want to incorporate a professional service like Three Movers. Companies who are experienced with international moves will do all the work for you, and you just have to supply the necessary documentation.

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Factor #3: Moving Out-of-State​

When moving out of state, one thing to keep in mind, especially with any kind of taxes, is that you will be required to fill out a tax return for the state you were living in, as well as the state you just moved to. This could be a blessing or a curse depending on how your state operates.

For example, say you move from a state that does not require the payment of sales tax to a state that does collect sales tax. You are going to need to register your car in your new state, which means you could be looking at a hefty investment upfront. Car dealerships in states that impose sales tax take care of the taxes for the registration when they initially plate the vehicle. In a state without sales tax, this will not have been done.

Moving On Your Own

If you decide that you don’t want to go with a moving company for your move, be aware that there could be costs you were not expecting. When you rent a moving truck on your own, you are imposed a sales tax. This relocation tax is factored at a higher rate than state sales tax. On average, you are looking at a rate of 8.5% when moving on your own.

Moving services charges sales tax on items

Read The Fine Print

When you get your quote from a moving company, ask them for it in writing, not just verbally. Just because they are exempt from sales tax, doesn’t mean that some of them won’t try to insert hidden fees in your contract.

Three Movers offer full transparency with our customers. We don’t charge you for anything that you don’t need. We go over your quote with you in detail, as well as your contract with us so that you are never unsure of the quality of service you are getting.

Beware of Rogue Moving Companies

The term rogue movers is reserved for any moving company that is not licensed. A reputable moving company will be licensed and follow all Department of Transportation guidelines, as well as state-mandated rules for moving companies.

These types of companies like to charge fees, including sales tax, when they are not required to do so. It is equally important that you are getting a legitimate service when seeking a fair price for a move.

Discussing about avoiding to charge the sales tax with moving companies

Three Movers

With over 20 years of experience and service in the moving industry, Three Movers take pride in the service that we provide our customers. Based on reliability and expertise, your move could not be any easier. Call today for a free quote with no obligation. We look forward to proving that we are the industry’s best moving company by providing you with top of the line full-service moving options.

Frequently Asked Questions

Purchasers can use sales tax exemption certificates to make tax-free purchases that would otherwise be subject to sales tax. The seller holds the certificate and is free to sell the buyer goods or services without adding sales tax.

The cost of the storage service is taxable when it is provided within the State. Local sales tax is not charged on storage services that are provided outside of the State.

Moving services, such as moving household goods, are exempt from sales tax unless they are part of a bill for the sale of taxable goods or services (e.g., a charge for shipping as part of the sale of taxable tangible personal property).

First, ensure the accuracy of your estimate. Get several quotes and abstain from underquoting. Make sure the whole inventory of the things you intend to relocate is the basis for your estimate. Check to make sure nothing is missing by carefully reading your quote. Verify that you comprehend everything your estimate mentions.

Written by Chris Townsend

Chris Townsend

Chris Townsend is a moving professional and relocation expert that has more than 10 years of experience in the moving industry. With a background that includes working in virtually every aspect of the company, he has distinguished himself as an integral part of our operations with expertise in all things related to moving.

If you have any questions about moving, our services, or anything else you think he may be able to help with, you can contact Chris by emailing him at [email protected]

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