Use Tax Required on Internet Purchases

As you prepare to file your Michigan income tax return, please remember to remit tax on those purchases you made, either by telephone or over the Internet. Every state that has a sales tax has a companion tax for purchases made outside that state by catalog, telephone, or Internet. In Michigan, that companion tax is called "use tax," but might be described more accurately as a remote sales tax because it is a 6 percent tax owed on purchases made outside of Michigan. If no sales tax was paid on catalog, telephone, or Internet purchases made from out of state sellers, as well as purchases made while traveling in foreign countries, when the items are to be brought into Michigan, use tax must be paid on the total price (including shipping and handling charges).

Michigan makes it easy for taxpayers to pay use tax when they file their annual income tax return. Please see line 23 of the Form MI-1040 Michigan Individual Income Tax Return and the instruction booklet for more information on how to report your tax.

You can also learn more about the use tax by visiting http://www.michigan.gov/taxes/0,1607,7-238-43529-155531--,00.html. If you need additional help you can contact the Michigan Department of Treasury at 517-636-4486.