Internal Policy Directive 2004-2

Internal Policy Directive 2004-2
November 22, 2004
GENERAL SALES AND USE TAX ACTS: FORMATTING REQUIREMENTS FOR REMITTANCE DATA

POLICY ISSUE

What are the formatting requirements for data that accompanies a sales or use tax remittance?

POLICY DETERMINATION

Data submitted by a seller along with any remittance of sales tax or use tax shall be formatted using uniform tax type and payment codes when such codes are approved by the Board (as defined in the Streamlined Sales and Use Tax Administration Act, MCL 205.803(b)).

DISCUSSION

Michigan has participated in the Streamlined Sales and Use Tax Project and, with passage of the Streamlined Sales and Use Tax Administration Act (2004 PA 174, MCL 205.801 et. seq.), anticipates becoming a "member state" under the Streamlined Sales and Use Tax Agreement ("Agreement").

Section 319(F) of the Agreement provides that each member state must require that any data that accompanies a remittance be formatted using uniform tax type and payment type codes approved by the governing board. The governing board will not become operational until the Agreement is effective, which is not expected to occur prior to October, 2005. Until the governing board approves uniform tax type and payment codes, the Department will continue its practice of requiring data submitted by sellers with a remittance of sales or use tax to be formatted using the TXP addenda record developed by the Federation of Tax Administrators (FTA) and the National Automated Clearing House Association (NACHA). At such time as the governing board adopts tax and payment codes, the Department will issue guidance requiring the use of those codes.