Refunds are coming - California Wholesalers Should Be Next

Tobacco Tax Refunds has been consistently churning out refunds having filed millions of dollars on one specific issue alone. A Florida Appellate Court determined in the 2012 case of Micjo v. DBPR that neither federal excise tax nor shipping charges are included in the taxable portion of the wholesale sales price. This case in Florida changed tobacco tax throughout the entire United States.

Unsurprisingly, we, Tobacco Tax Refund, have found that this issue applies to many other states with similar tobacco tax laws. California imposes a 28.13% tax on the “wholesale cost” of Other Tobacco Products, effective July 1, 2015. California is unique in that tobacco tax on the “wholesale cost” varies from year to year.[1] Section 30017 of the California Revenue and Tax Code defines “wholesale cost” as “the cost of tobacco products to the distributor prior to any discounts or trade allowances.” Despite a slightly different terminology than Florida’s “wholesale sales price,” a similar analysis is applicable to that of Florida ensuring significant refund claims.

We advise all persons who are or represent a wholesale tobacco distributor to file a refund claim, as there really isn’t any downside. Take the example of an invoice below:

Tobacco - $200,000

Federal Excise Tax - $160,000

Shipping - $40,000

Total Invoice - $400,000

Tax imposed on the “wholesale cost” – 28.13%

Using Tobacco Tax Refund’s theory, if payment is made on the entire $400,000 invoice, which includes the FET and Shipping costs, then a refund is due on 28.13% of the non-tobacco items, FET and Shipping Costs. The wholesale tobacco distributor would be entitled to a $56,260 refund. This is just for one individual invoice. A wholesale tobacco distributer could effectively go back a few years on this issue. Our team can assist your company and claim large refunds.

Tobacco taxes are not your ordinary taxes, many experienced tax professionals do not handle such unique taxes. Wholesale cost of Other Tobacco Products is a complex area requiring a specific expertise that we may provide. Tobacco Tax Refund solely deals with these types of issues. Our team will challenge any state tobacco taxing agency as tobacco tax refunds is our sole focus.

How can we assist you?

· We ensure all taxpayers an appropriate and efficient evaluation of each situation and advise how to proceed.

· We will review the audit results and discuss various paths to challenging your results.

· Typically, penalties may get reduced or eliminated.

· Often, tobacco taxes and related interest may be reduced.

· We strive to secure refunds in a timely manner.

In addition, if you are located in Alaska, Colorado, Connecticut, Delaware, Illinois, Indiana, Iowa, Maine, Montana, New Hampshire, New Jersey, Oregon, North Dakota, Utah, Wisconsin, or other states with similar laws then you might have a refund based on Micjo. Give us a call to get started today!

Talking to us is FREE, so give us a call today at (888) 918-4690.

In his law practice Mr. Donnini's primary practice is multi-state sales and use tax as well as state corporate income tax controversy. Mr. Donnini also practices in the areas of federal tax controversy, federal estate planning, Florida probate, and all other state taxes including communication service tax, cigarette & tobacco tax, motor fuel tax, and Native American taxation. Mr. Donnini obtained his LL.M. in Taxation at NYU. Mr. Donnini is licensed to practice law in Florida. If you have any questions please do not hesitate to contact him via email [email protected] or phone at 954-639-4496.


[1] http://www.boe.ca.gov/sptaxprog/tax_rates_stfd.htm#5

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