Buying new equipment across state lines: taxes!

[CKH]

I live in Portland, Oregon, which is right on the border of Washington state. My best candidate for a first laundromat to acquire is across the state line in Vancouver, Washington, which is more convenient for me than a lot of mats in my city because I live so far north. Now here’s the deal: Oregon has no state sales tax, but Washington does. When I go shopping up there (which I avoid because of tax) I can usually get out of paying sales tax if I show my ID because Oregon residents don’t have to pay sales tax. Now, I’ve got my first quote for retooling the laundromat for a Washington-based distributor and of course, the quote includes sales tax, which is quite a jaw-dropping amount for someone not used to paying sales tax! And I’m left wondering why I should be required to pay that and if there’s any way to avoid it? Now I want to qualify that with the fact that I’m not a tax evader and I want to always do the ethical thing in life and business, but I’m struggling to see how paying the sales tax in this situation is right. So I asked another distributor based on the Oregon side that question and he said they could sell us the equipment here and I would just have to sign an indemnity form that says if I get audited by Washington, I hold the distributor harmless. This makes it sound like Washington would indeed come after me if I bought my equipment here and took it across state lines to install it in my store! And that is not a risk I’m very willing to take with my business. Does anyone have any insight into this matter?

[Brian]

Washington resident here…no specific knowledge of tax laws so take this for what it is worth – a (somewhat) educated opinion. In just the past year Washington seems to have gotten more aggressive/crafty in pursuing tax revenue – this happened on both a purchase i made of a private vehicle and on where my vehicles are licensed. They come at you with a guilty until proven innocent POV. The logic appears to be driven by where the “use” of the asset is. I could see that being applied in the case of your laundry equipment purchase as well. LIke i said…don’t know anything for certain but wanted to share. Given that experience, I think your risk assessment is right and they will find a way to come for the sales tax $$. Good luck!

[CKH]

Oh my goodness, thank you so much! This is exactly what I needed. So essentially, if I stay here in Oregon, I save $17k. That’s a tough pill to swallow. But with limited options for laundromats to buy, I’m not sure I have much choice.

[Meerr yava]

Taxes can be quite the surprise, right?

[Dany dich]

Saving $17k just by staying in Oregon sounds like a pretty sweet deal. It might be a tough choice, but hey, sometimes the financial savings make it worth it.

By the way, while you’re diving into the world of finances, have you had a chance to compare crypto tax calculators? It can make a world of difference when managing your crypto investments.

• This reply was modified 4 weeks, 1 day ago by Dany dich.

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