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Compliance FAQs
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Compliance FAQs


Truck and Trailer

Question: We just got our federal DOT numbers. Now we are getting calls about an audit. Is this legit?

Answer: You will receive an audit from the Federal Motor Carrier Safety Administration within 18 months of getting your federal DOT registration as a "new entrant." Private companies will call offering services to help you prepare for this audit, but you are not required to purchase them. For more information, follow this link: http://www.fmcsa.dot.gov/rules-regulations/administration/fmcsr/fmcsrruletext.aspx?reg=385.307


Sales and Use Tax

Question: 
As landscape contractor, on what do I pay sales and use taxes and on what do my customers pay the sales and use taxes?


Answer: 
Generally, landscape contractors must pay sales taxes on all materials and equipment used on a job. Labor is not subject to sales tax. However, you cannot itemize sales taxes that you pay on materials and equipment on the invoice you present to your customer.

For example, you have contracted to put in a paver patio for a client. You must pay the sales taxes on all of the materials and equipment used on that job: the pavers, the stone for the base, the broom that you use to sweep the sand, the vibrating compactor that you rent, etc. The sales taxes you have paid cannot be itemized on your bill. However, you can include the sales taxes as part of the markup or overhead you charge the client for the job. They just cannot be itemized on the bill.

The exception to this is when you are working for a tax-exempt entity, like a church or government agency. Then, certain items you are using on a job are not subject to sales tax.

Also, lawn care services are subject to sales taxes in Pennsylvania, but that's another topic.The Pennsylvania Department of Revenue has a pretty good website on this topic in a question and answer format. Click here to go to their website. 

Question: What is the PA state tax rule when charging sales tax to shipping fees from a vendor? Example: If I order a part to repair landscape equipment and it needs to be shipped in, I, the customer, will be charged a shipping fee. Is that shipping fee taxable? Another example: If I order plant material and there is a delivery fee, is the delivery fee taxable? Please advise...

Answer: Unlike most sales tax questions in Pennsylvania, this one is fairly straight forward. If a good is subject to sales tax, then any delivery charges are also subject to sales tax. If a good is not subject to sales tax, then the delivery charges are not taxable.

But the trick here is knowing if the good being shipped is taxable or not.

Equipment Parts

In the case of a landscape contractor ordering a part for any equipment, that part, and consequently its shipping charges, will be subject to state sales tax that the landscape contractor must pay. If the part is shipped from out of state and no sales tax is charged by the vendor, the landscape contractor must then calculate the use tax on the part and shipping, which is the same rate as the sales tax, and remit it to the state.

Plants: Used on a Job or for Resale as Plants?

The case of the plants is a bit more complicated. In the case of landscape contractors, the plants and their shipping charges will almost always be subject to sales and use tax which must be paid by the landscape contractor.

However, if the plants are bought to be resold as plants (not as a part of a job), then they are not subject to sales and use tax to the purchaser (nor are the shipping charges). So if you sell the plants at retail or at rewholesale, the plants and their shipping charges are not taxable to you, but you must collect the sales tax from the purchaser at the time of sale and remit it to the state.

In this latter case, if you have both a landscape contracting operation and a retail garden center or rewholesale yard, you must keep careful records of plants or other materials (for example mulch, pavers, etc.) purchased for resale vs. those that are used on a job because the sales tax treatment is very different. If you don’t keep careful records and are audited, the auditor may consider all items and shipping charges taxable. You could find yourself with an unexpected large sales and use tax bill with penalties.

The Exception

The exception to the above occurs when the delivery charges are billed directly to you by the carrier (for example, FedEx or UPS). In this case, the delivery charges are not subject to sales and use tax, regardless of the the tax status of the items being shipped.

For More Information

For more information, click here see the section of the Pennsylvania Code that applies.


The Water Resource Planning Act (Act 220)

Question: What is Act 220?

Answers: Act 220, also known as the Water Resources Planning Act, was signed into law in December 2002, requires the Department of Environmental Protection (DEP) to update the State Water Plan and conduct a statewide water withdrawal and use registration and reporting program. This water resources inventory will allow the DEP to determine how much water Pennsylvania has, how much is being used, and how much will be used in the future.

Question: Who needs to register under Act 220?

Answer: Act 220 states each public water supply agency and each hydropower facility, irrespective of the amount of withdrawal, and each person whose total withdrawal or withdrawal use from one or more points of withdrawal within a watershed operated as a system, either concurrently or sequentially exceeds an average rate of 10,000 gallons per day in a 30-day period, shall register with DEP the source, location and amount of withdrawal or use or both.

Question: How do I know if use 10,000 gallons per day?

Answer: There are a number of ways of estimating including timing of water pumps of known capacity. Go to ‘Estimating Water Use for the Farm and Home.’ Or you can call the Act 220 Hotline at 1-888-457-6653 for further assistance.

Question: Which sources should be registered?

Answer: Each source, such as, but not limited to, wells, interconnections to public water supplies, and surface water withdrawals, that use more than 10,000 gallons per day over a 30 day period MUST be registered. If the combined water use of all your sources equals more than 10,000 gallons per day averaged over any thirty-day period, then all of the sources must be counted.

Also, registration is source specific not necessarily site specific. For example, a school district with 7 schools that all draw from the same 2 sources would only have to register the two sources; a farm operation which several buildings at different sites but all withdrawing from the same well would only have to register one source-the well. If you still have questions, call the Act 220 Hotline at 1-888-457-6653.

Question: What is the purpose of Act 220?

Answer: The State Water Plan has not been updated in over 25 years and does not tell us which areas have critical water needs. As a result, we don’t know who is running out of water until wells and local supplies dry up.

Question: Are there any fees involved?

Answer: There are no fees associated with registering under Act 220.

Question: What if I want my information to remain confidential?

Answer: In general, information that is submitted to the Department under Act 220 is subject to the Right-to-Know Law. On your registration form, you may identify any confidential information, but will be asked to provide a justification for its confidential nature.

Emerald Ash Borer

Question: How can I help control the spread of this insect?

Answer: Since many species of wood-boring insects, including the Emerald Ash Borer, can be spread through transport of infested firewood and logs, campers and homeowners are encouraged to: use only locally harvested firewood; burn all of it on-site; and not carry it to new locations. If you have ash trees, look for the following signs of infection:
  • General decline in overall health of tree
  • D-shaped exit hole (see Figure 1)

















  • Identify the insect (see Figures 2 and 3)





Question: What should I do if I suspect my ash tree is infected?

Answer: People who suspect they have seen Emerald Ash Borer should call the department’s toll-free pest hotline at 1-866-253-7189. For more information about Emerald Ash Borer, visit http://www.emeraldashborer.info/ or call 717-772-5229.

Question: Is it safe to continue gardening activities?

Answer: Yes. Emerald Ash Borer feeds exclusively on ash trees. Other trees and plants are not at risk.

Question: Where can I find more information?

Answer: You can visit:

 

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