Georgia - Hey That's Where We're From!

[00:00:06] Speaker A: Welcome, everyone, to today's episode of Taxing Poetic. I am your co host, Tim Howe, along with. [00:00:11] Speaker B: I am your other co host, Jenny Carter. [00:00:13] Speaker A: And as always, our esteemed producer, JB. [00:00:16] Speaker C: Hello. [00:00:17] Speaker A: What up? Today we are going to be covering a Georgia episode. Hey. That's where we live. We're going to be talking about all the weird things and tacks here in Georgia. We're joined with a guest, kind of a pseudo frequent guest on our. On our program is Donna McMurray, our director of legislation and tax policy. Hey, Donna. [00:00:33] Speaker B: Hello. [00:00:34] Speaker A: So nice to have you here. [00:00:35] Speaker D: Glad to be here, I think. [00:00:36] Speaker A: Awesome. Awesome. We're going to sit here and pick on Georgia for a few hours. We're going to have a lot of. Or, excuse me, not a few hours. Good God, I hope not. I mean, we could. I was like, okay, let's get after it. We're going to talk about every department in the state of Georgia, but no, we're just going to talk about the Department of Revenue and some of the interesting tax law and stuff like that. The legislature's passed, so I'm going to kick it over to Jenny, as always, for my favorite segment of the show. [00:00:58] Speaker D: It's my favorite. [00:00:59] Speaker A: It's a lot of people's favorites. [00:01:01] Speaker B: Just not Tim, just not mine, which. [00:01:03] Speaker D: Is part of why it's my favorite. [00:01:04] Speaker A: Part of the show. [00:01:05] Speaker B: I know. Just because Tim's not good at it doesn't mean, you know, he doesn't have to like it. [00:01:09] Speaker A: Yeah, right. [00:01:10] Speaker B: Well, hey, let's not discuss where that came from. [00:01:12] Speaker A: Well, an insert grumpy cat. So here I am. Grumpy cat that doesn't get the tuna. [00:01:17] Speaker C: So. [00:01:17] Speaker A: All right, Jenny, hit us with your high card. [00:01:19] Speaker B: All right, you ready? Yeah. Here we go. Ray Charles said it best. Georgia sales tax on my mind. Is that how it goes? [00:01:30] Speaker C: That's good. [00:01:31] Speaker A: Oh, my God. Oh, that's awesome. [00:01:34] Speaker B: And we're so glad Donna's here. Donna, the public demanded your return. You know, we cannot go an episode without name checking you. You are the oil, the grease that keeps the wheels turning on this podcast. [00:01:46] Speaker A: I would say the books that, you know, are the inventory of the library. So that's basically it. She's the one who stalks us with all the knowledge. So congratulations. [00:01:55] Speaker D: Do my best. [00:01:55] Speaker B: We could not do this episode without you. And just a reminder, everybody, while we're having and an individual episode, just about Georgia is because we left it out of our, what, Wikipedia series, JB, when you researched regions. And you can listen to all of our regional series podcasts in our library. Wherever you listen to podcasts where we cover all the different states. You know, JB found them on Wikipedia. [00:02:20] Speaker A: There you go. [00:02:20] Speaker B: And we just. We left Georgia out on purpose for that library so we could just cover it with its own episode, because we know a lot about it and we're going to talk about it. [00:02:29] Speaker A: So we sit here. [00:02:30] Speaker D: We do. We sit here. [00:02:31] Speaker A: We're getting ready to find. [00:02:32] Speaker C: We also brought it up a lot. [00:02:34] Speaker A: Yeah. [00:02:34] Speaker C: A lot of episodes. That's true. Yeah. Right. [00:02:37] Speaker B: Yeah. But we're just dedicating our own, you know, this. This next half hour or so just to talk about our lovely state. [00:02:43] Speaker A: And speaking of knowledge, Donna is going to hit us with, I believe, a quiz today. [00:02:48] Speaker C: Donna usually does the quiz and we work on together, but she does 100% of the work. And then this time, I was like, I'll help you with the quiz. So I just. So this is a quiz brought to you by both of us. [00:03:02] Speaker A: Wait a minute. [00:03:02] Speaker B: I've subcontracted out the quiz. [00:03:04] Speaker A: This is a tax quiz that's done by a non tax guy. [00:03:07] Speaker C: But obviously, Donna had to look at it and be like, it's been reviewed. You're correct. [00:03:11] Speaker A: Okay. [00:03:12] Speaker B: I subbed it out. [00:03:13] Speaker A: We've had legal review. [00:03:14] Speaker D: That's right. [00:03:14] Speaker A: Okay, good. [00:03:15] Speaker C: Yes. [00:03:15] Speaker B: Don't sell JB short. He's learned a lot about tax. [00:03:19] Speaker A: He's selling him short. [00:03:20] Speaker C: I still need Donna to check my clip. [00:03:23] Speaker A: He's the good color commentary. [00:03:24] Speaker C: He's a young dirty on the year. Jenni is winning five to three and a half. [00:03:30] Speaker B: Oh, wait, I didn't hear that. Wait, who's winning? [00:03:33] Speaker C: Jenny. [00:03:33] Speaker B: Oh, me. [00:03:34] Speaker C: Jenny is winning. [00:03:34] Speaker B: Me. [00:03:35] Speaker A: I winning Jenny. It's a marathon, not a sprint. It's a marathon early on. Plenty of months in front of the episode. [00:03:43] Speaker B: Let me just enjoy this moment, please. [00:03:45] Speaker C: Okay, so first question is for Jenny. In our Georgia sales tax quiz, Georgia imposes a dollar one per tire disposal fee on the retail sale of a replacement. [00:03:57] Speaker B: Okay. [00:03:57] Speaker C: What percentage of that is taxable? [00:04:01] Speaker B: Zero. [00:04:02] Speaker C: It is zero. [00:04:04] Speaker B: Yay me. [00:04:06] Speaker C: Do you know why? [00:04:08] Speaker B: Because they are charging it for environmental fees. Environmental. [00:04:13] Speaker C: Well, it's because you put it on a consumer. [00:04:16] Speaker A: Right. [00:04:16] Speaker C: Like, a disposal fee is not imposed on the seller. The fee is not subject to sales tax when it's itemized on the customer's invoice. [00:04:24] Speaker B: Okay. [00:04:25] Speaker D: Wow. [00:04:25] Speaker B: Look at. I know. [00:04:26] Speaker D: Look at JB. [00:04:26] Speaker B: Look at JB. I know. [00:04:28] Speaker C: So, Tim, would you have got that one? [00:04:30] Speaker A: No. I'm gonna lie to you. I would have said that it was a mandatory component of the sale, even though it was being separately stated. And I would have thought that it would have been taxable. [00:04:38] Speaker C: I think that's what. Maybe that's why I made this question, because I think that's what I think it seems like. I mean, 100% would be of $1. Who cares one cent? [00:04:47] Speaker A: And there just must be a section of title 48 inside the OCGA that actually talks about certain fees that are exempted. Right. [00:04:54] Speaker D: Well, you don't always tax add sales tax to a fee. [00:04:58] Speaker A: That's. And see, that's what's interesting. Cause it'd be a tax on a tax. Right. Or tax. [00:05:01] Speaker D: Not that that's ever stopped anybody before. [00:05:02] Speaker A: But, yeah, that's a very good point. [00:05:05] Speaker D: Right. [00:05:05] Speaker B: This is obviously why I'm in the lead for the quizzes. So let's just. [00:05:09] Speaker C: Jenny's now up six to three and a half. [00:05:10] Speaker B: Yeah. [00:05:11] Speaker A: So I haven't had my question. [00:05:14] Speaker C: Okay, Tim, you go out to Robert Redford's favorite restaurant, Elizabeth's on 37th in Savannah. After the meal, you get a 20% mandatory gratuity on the bill. Is the tip subject to sales tax? [00:05:27] Speaker A: Yes, it is. [00:05:29] Speaker C: Yes, you are correct. Do you know why? [00:05:31] Speaker A: Because it is considered to be mandatory and it is a component of the basis, the taxable basis, or it has to be included in the taxable base because it's a mandatory portion of the sale. [00:05:42] Speaker C: But if I were to just give. [00:05:43] Speaker A: A tip, it's non taxable. [00:05:45] Speaker B: Non taxable. [00:05:45] Speaker D: Non taxable. [00:05:47] Speaker C: A lot of places do that. I always thought it was because they were like, I want to make sure my server gets the tip. And, like, when they put it in, is there like some sort of benefit for restaurants? [00:05:58] Speaker A: So if you think about it, if you're saying to someone like shipping and handling charges, right. If you say these are required, you have to pay these, it is part of the sale. Then guess what? Typically, they're going to be taxable unless it's enumerated in a state of being exempt. So what George is saying here is, hey, you're requiring that charge. It's not a fee. You're requiring the charge as a component of the sale. It's got to be lumped into that sales price, and it will follow the taxability of the item. So it would be taxable. Right. There's no benefit to the restaurant, though. And in all actuality, what really stinks is that the restaurant has mandatory tip reporting that they have to do at the federal level, which makes things really nasty. [00:06:36] Speaker D: Right. So I have a further question for you, Tim. So if they say we're going to add a 20% gratuity, but the fine print says this can be changed or not required. [00:06:47] Speaker A: It is considered optional. [00:06:48] Speaker D: There you go. [00:06:49] Speaker A: There you go. And it's non taxable. [00:06:50] Speaker C: Sometimes they say they'll add it, but they're. [00:06:53] Speaker D: Yeah, they'll say, well, we're gonna add a 20% tip for parties of whatever or more. But in the fine print on the receipt, it may say, not mandatory. Not required. [00:07:02] Speaker B: Interesting. And then you can always tip more on top if you want. Right. So that would be non taxable. Right. The extra tip. That's exactly right. But I think to your point, JB, what you're saying is I think it's an advantage for the restaurant to do it to make sure that the waiter or waitress gets tipped for a large party. But I don't think it really. Tax perspective, it doesn't move the needle. Yeah. [00:07:25] Speaker A: So it's a pass through. [00:07:26] Speaker C: It is six to four and a half. [00:07:28] Speaker A: Now, Jenny's favorite word. Regressive. [00:07:30] Speaker C: Regressive. [00:07:30] Speaker B: Regressive. [00:07:31] Speaker C: Okay, Jenny, question number two. Georgia Stomp, which stands for stomp tax on menstrual products, has a simple goal. No sales tax on menstrual products. What is the current rate for these products? [00:07:44] Speaker B: Oh, menstrual products. Let me think about this. I would say 6%. [00:07:54] Speaker A: It's the local rate. You don't pay the state tax. You just pay the local rate. [00:07:58] Speaker C: It's actually. [00:07:59] Speaker D: That's the full rate. [00:08:00] Speaker A: Is it fully rated? [00:08:01] Speaker D: Yeah, 4% state and plus the local. [00:08:03] Speaker A: Oh, yeah. [00:08:04] Speaker D: Oh. [00:08:05] Speaker B: So, I mean, technically, it could be correct. In what? DeKalb county. Right where I live. So I think I deserve. [00:08:11] Speaker C: You should have just said where I live. And I would have been like, hey, maybe she's right. [00:08:16] Speaker A: And actually, I'm gonna tell her that she's wrong. [00:08:18] Speaker B: Cause I know it's not a 6%. Terminate. I know. I'm trying to think who is 2%? Is anyone? [00:08:25] Speaker C: Maybe Jenny just lost twice. [00:08:28] Speaker B: I don't think you can count that. [00:08:29] Speaker D: Against her twice, though. [00:08:32] Speaker B: This is why I wanted to have you here. I got you. [00:08:35] Speaker C: Yeah. So, again, kind of a regressive tax. It's about a $6 million they collect each year. So, you know, is that really moving the needle so much that you have to do this? And obviously, if guys menstruated, you would be able to get them at. You'd get them free beer. [00:08:52] Speaker B: Absolutely. [00:08:55] Speaker A: How did this conversation just get distracted? [00:08:58] Speaker B: Let's talk more now that you're just coming. [00:09:00] Speaker D: Chocolate. [00:09:00] Speaker A: For those of you watching us. I just gave JB one of the weirdest looks probably ever. [00:09:04] Speaker C: I wrote down that I thought Tim might say that. Women and children get out of the building first. There's a fire. [00:09:11] Speaker B: That's why Seinfeld references. I love that. [00:09:16] Speaker C: There you go. Going on our Seinfeld thing for the day. [00:09:19] Speaker B: Yes. [00:09:19] Speaker C: Okay, Tim, question number two. You get a plus minus of two. Because I. So just like, on the number. The 2024 State Business Tax climate index ranked Georgia Blank. [00:09:37] Speaker A: This is just like pulling a number out of it. [00:09:39] Speaker C: It is like, you know, I mean, I'll ask you why you picked, you. [00:09:42] Speaker A: Know, where you picked, but state climate index picked Georgia as. Is this a state business climate index. So it's actually talking about state business. [00:09:51] Speaker C: State business tax climate index. [00:09:53] Speaker A: Okay. Okay. I'm gonna say like 24th. [00:09:57] Speaker C: Yeah. So 32. [00:09:58] Speaker A: Okay. [00:09:59] Speaker C: Why do you think 24? [00:10:00] Speaker A: Why do you think? I think it's pretty friendly. You know, I would say if we're. If we're ranking them from one being the best to 50th being the worst, I would have said Georgia was like, right in the middle just because of our manufacturing exemption, our low income tax rate. You know, fact is, pretty median sales tax rates. And, you know, our laws aren't too complex or too goofy, you know, with regards to businesses having to adhere to them. [00:10:25] Speaker C: I wonder. So would he have got it right if he did the. If he added all the nomad states for not counting? [00:10:30] Speaker B: True. [00:10:31] Speaker C: And then plus 24 is 29, which would have got him real close to 32. [00:10:35] Speaker D: So is this a business tax index or just business index? [00:10:38] Speaker C: It's a state business tax climate. [00:10:40] Speaker B: Yeah, we talked about this in a previous episode because New York, New Jersey and Pennsylvania are, like, in the top three. Right. [00:10:46] Speaker A: Go figure. So I'm gonna give you a three as the worst. [00:10:49] Speaker B: Exactly. That's what I mean. [00:10:51] Speaker A: There you go. I just feel like in the best. [00:10:53] Speaker B: Right, right. [00:10:54] Speaker C: I feel like this one's a little tough, so I. So there's a bonus point. [00:10:57] Speaker A: Okay. [00:10:57] Speaker C: Who's number one? [00:10:58] Speaker A: Who's number one? [00:10:59] Speaker C: Yeah. [00:11:00] Speaker A: Like at the absolute worst. [00:11:01] Speaker C: No, no, the best. [00:11:02] Speaker A: Oh, the best. Hold on. [00:11:05] Speaker C: I feel like we've said this before. This is why I was like. I feel like we talked about this. [00:11:08] Speaker B: We have talked about this before, but I can't remember. [00:11:10] Speaker C: Isn't it like main or Wyoming? [00:11:14] Speaker A: Oh, Wyoming. Yeah, we brought that up. [00:11:17] Speaker D: Yeah, we did. We did. [00:11:19] Speaker B: In the Wyoming episode where we talked about Wyoming. [00:11:22] Speaker C: The Yellowstone one, I think. [00:11:24] Speaker B: Yeah. You get no points, though. Just FYI, for those of you keeping. [00:11:28] Speaker A: Track, at least I know the sales tax rate of where I live. [00:11:32] Speaker C: So why does everyone like Wyoming so much? I mean, it's been number one for a while. [00:11:37] Speaker A: Yeah. Well, I mean, I don't think they. [00:11:39] Speaker B: Have a lot of complexity. Right. [00:11:40] Speaker A: Their population density is not too huge, and so they don't really have a lot. Yeah, keep it simple, stupid. That's basically the kiss method, almost. [00:11:48] Speaker C: It'd be like, more like, idaho is also. [00:11:50] Speaker B: Oh, true Wyoming. [00:11:52] Speaker C: Okay. Don't have a lot of people is the rule of taxes. [00:11:57] Speaker A: It's gonna be very interesting to see what happens in Idaho. My sister just moved there. And the influx of, like, the other western states, like, Washingtonians and Californians and everybody else that are moving into Idaho and Oregon. Yeah, Oregonians. It's gonna be interesting to see if that political climate changes and, like, how much are actually gonna change some. [00:12:15] Speaker C: I've seen a weird amount of people talking about Boise, Idaho. [00:12:18] Speaker A: Oh, yeah, dude, it's a tax. It's a huge tech hub. Like, really, really big on the tech front. [00:12:22] Speaker C: Okay, Jenny, question number three. When was Georgia's last sales tax amnesty date? [00:12:28] Speaker B: Oh, my gosh. Amnesty date? Oh, last August. [00:12:34] Speaker C: It was a very long time ago, Tim. Do you remember? [00:12:38] Speaker A: It was a very long time ago. [00:12:39] Speaker C: Very long. [00:12:40] Speaker B: Like a sales tax holiday? [00:12:41] Speaker D: No, not a holiday. [00:12:42] Speaker A: Amnesty. Amnesty. This is like. Yeah, this is like saying that you're free and clear under audits. Like, if you actually come forward and you say, hey, I collected a bunch of tax, or, hey, I didn't pay my income tax for, like, six years. They give you an amnesty. [00:12:54] Speaker D: It's a VDA for everybody without all the hoops. [00:12:57] Speaker B: I just learned something today. I never heard of it. [00:13:00] Speaker C: That was gonna be my follow up, is, like, to explain to me what an amnesty is. [00:13:04] Speaker A: I'm gonna guess, like, it's somewhere in the eighties. [00:13:06] Speaker C: It was actually so not that long, but. No, 2011, 2012. [00:13:11] Speaker A: I was gonna say 1412 years ago. [00:13:13] Speaker C: Not exactly sure why on the thing, but. So they basically are just, don't worry about it. [00:13:21] Speaker D: Yeah, I mean, they're pretty much, like, come forward, just pay us what you owe us, and we'll waive penalty and interest. But you've got to do it during this small timeframe for whatever this look back period. [00:13:30] Speaker A: Usually when states coffers are really, really tight. So if you look at the timing of that right after that's coming out of the crash. Yeah. And the bailouts and everything. So the states are like, oh, my. [00:13:39] Speaker C: God, we need money, please, like, we'll be cool. Just send us a chance. [00:13:43] Speaker A: Send us a chill I promise. Just send us a check. [00:13:47] Speaker C: Amazing. [00:13:48] Speaker B: That's good to know. [00:13:49] Speaker C: All right, Tim, question number three. If you read somewhere the Gen Z thinks it's chewy to roll your own cigarettes, and in a gen x act of defiance, started rolling your own cigarettes, what would you pay in sales tax for loose tobacco? [00:14:04] Speaker A: You pay the full rate? [00:14:05] Speaker C: Yeah. Is she high? Do you know what it is? [00:14:08] Speaker A: Oh, God. I don't know what the state tobacco rate is. Here, hold on. Let me take a guess. [00:14:12] Speaker B: You should. [00:14:13] Speaker A: It's kind of insane. [00:14:14] Speaker C: He doesn't roll his own cigarettes. [00:14:15] Speaker A: I don't roll my own cigarettes. I buy packs of them. [00:14:18] Speaker C: Nobody's called them Cheugy yet. [00:14:20] Speaker B: I'm like, that's my follow up question. Tim, do you know what Cheugy is? [00:14:23] Speaker A: I do not know what Cheugy is. [00:14:24] Speaker B: You need to hang out with more teenagers. [00:14:26] Speaker A: Do not know what Cheugy is. [00:14:27] Speaker B: I didn't mean that in a weird way. Yeah, I should have said that. [00:14:30] Speaker D: Hang on. [00:14:30] Speaker B: More teenagers. [00:14:31] Speaker C: I'm probably gonna go ahead and cut that. [00:14:33] Speaker A: Here's my second weird look of the day going towards Jenny. How many teenagers do you hang out. [00:14:38] Speaker B: With on a regular racing? I hang out with two of them. [00:14:42] Speaker C: It's just a gen z thing for the opposite of trendy. [00:14:47] Speaker D: Like cringey. [00:14:48] Speaker B: It's like, kind of cringy. [00:14:49] Speaker A: Oh, it's cringy. Okay. [00:14:51] Speaker B: Yeah. [00:14:51] Speaker A: That's a new one for me, too. I'm gonna guess 18%. [00:14:56] Speaker C: So 10%. [00:14:57] Speaker A: Okay. [00:14:57] Speaker C: Very high, though. [00:14:58] Speaker A: That's high. [00:14:59] Speaker B: Yeah. [00:14:59] Speaker C: I mean, imagine that's because that's loose tobacco and you had a roll and all the serious all things. Yeah. Same tie. [00:15:06] Speaker D: Do you pay that? And then the sales tax rate on top of it? [00:15:09] Speaker A: I don't know. In all honesty, tobacco tax is something that, believe it or not, I've never researched. [00:15:15] Speaker D: Yeah. [00:15:16] Speaker C: Anytime they want to add a little something something. [00:15:18] Speaker A: Well, syntax, this is just like fuel tax. [00:15:23] Speaker C: Yeah, I actually did wrote down that and I said, jB will tell Jenny to tell Tim what Cheugy means. [00:15:31] Speaker B: That is fantastic. [00:15:33] Speaker A: Are you trying. You guys trying to say that I'm old? [00:15:35] Speaker B: We share a brain sometimes scare both of you. [00:15:38] Speaker C: That's amazing. Yes. Okay, so that was our quiz brought to you by me and Donna. [00:15:44] Speaker A: Fantastic. [00:15:45] Speaker B: So hold on, hold on. So I got one right? And did Tim get one right? [00:15:48] Speaker A: Tim got one. [00:15:48] Speaker D: Tim got one. [00:15:49] Speaker B: Ok. All right. [00:15:50] Speaker C: So does Jenny. Six. Tim, four and a half. [00:15:52] Speaker B: All right. [00:15:53] Speaker D: Love it. [00:15:54] Speaker A: Still holding strong going into turn one. [00:15:57] Speaker C: All right, let's take a break and we'll come back and do something. You know what's weird? [00:16:00] Speaker A: Sounds awesome. Thanks. [00:16:04] Speaker B: Welcome back to taxing poetic. And we're gonna jump right into you know what's weird. [00:16:08] Speaker A: And we're not talking about Jenny. We're talking about what is weird. [00:16:13] Speaker B: That's a whole other podcast episode in itself. Exactly. [00:16:15] Speaker A: In and of itself, we're talking about, do you know what's weird from a Georgia tax law perspective? And we got Donna here to kind of help us out and throw a little flavor in every now and then. But we're gonna start off with something that we've already covered once in the past, which is the Augusta rule. Right. And this is more of an income tax issue, unless in a sales tax issue, but it's kind of cool. Cause it was framed around what? Jenny? [00:16:38] Speaker B: The golf tournament in Augusta. [00:16:41] Speaker D: The Masters. [00:16:41] Speaker B: I know. I'm kidding. [00:16:44] Speaker C: I thought maybe she was. [00:16:45] Speaker B: I don't know anything about golf, but come on. [00:16:46] Speaker C: Even trying to get us not sued or something, she gave me the name. [00:16:49] Speaker B: I'm very. Yes. I never want to get sued. [00:16:51] Speaker A: Three weird looks that I've given this episode. Like, please, lord, tell me. [00:16:57] Speaker B: She could. [00:16:58] Speaker A: Tell you what kind of sandwiches they served. [00:17:00] Speaker B: I can. Pimento cheese and chicken salad and egg salad. Not chicken salad. Just eggs. [00:17:04] Speaker D: Not chicken salad. [00:17:04] Speaker B: Yeah. Exalted cheese. [00:17:06] Speaker A: Oh, they do have a cold fried chicken sandwich, though. That is to die for. [00:17:09] Speaker B: It's pretty good. Delish. It's like $2. [00:17:12] Speaker A: Yes. They're all. Yeah, it's all amazing. [00:17:14] Speaker C: Is that what it's about, the food or the lodging? The Augusta rule. [00:17:17] Speaker B: Oh, okay. [00:17:17] Speaker A: Oh, no, I'm sorry. The Augusta rule. [00:17:19] Speaker B: Did we get sidetracked about. [00:17:21] Speaker A: Yeah, we're all sitting here hungry. Actually. The Augusta rule is about homeowners in Augusta being able to rent their homes to individuals for less than 14 days a year and have it completely exempted as income or additional income on their federal income taxes. And it just got adopted and known nationwide as the Augusta rule, right? [00:17:43] Speaker B: Yep. [00:17:43] Speaker A: Pretty interesting. Named after a golf tournament and after a little tiny city in eastern Georgia. Not tiny. Sorry. Augusta. Decent sized city in eastern Georgia. [00:17:50] Speaker C: Disgusta. Do any. [00:17:52] Speaker B: Disgusta. Listen, that's on the apology list. [00:17:57] Speaker C: Fine. [00:17:57] Speaker A: I'll add it. [00:18:00] Speaker C: Did any other states take that or. [00:18:02] Speaker A: Oh, yeah. I mean, it's a nationwide. Yeah, it's an IR's. [00:18:06] Speaker D: Yeah, but it started here. [00:18:07] Speaker A: There's, like, three major stipulations to it, and one of it has to be less than 14 days. It doesn't have to be your primary residence, but it does have to be located here in the United States. Yeah, I can't remember where the third stipulation is. Oh, it needs. Oh, this is what it is. The rent needs to be reasonable and customary. So. Yeah, that's exactly it. So you gotta. It's gotta be market based rent, right? Yeah. [00:18:26] Speaker D: You can't rent it for enough to buy a new house. [00:18:28] Speaker A: Yeah, you can't say, hey, it's $400,000. [00:18:31] Speaker D: For one week, but still cheaper than the tickets. [00:18:34] Speaker A: Ah, you're darn right. [00:18:35] Speaker C: I'm trying to actually figure out how to do that. Cause I live right next to the east Lake golf course. And golfers really like staying at somebody's house and stuff. Cause they're in hotels all the time. [00:18:43] Speaker A: They hate it. [00:18:43] Speaker C: And they want their family able to travel. All the extra rooms and the kids stuff and all the things. And you can rent those out, like in a package of a thing. And you get. [00:18:51] Speaker A: You got to corporate. [00:18:52] Speaker C: $15,000 for a weekend or a month. [00:18:54] Speaker B: You should do it. [00:18:56] Speaker C: I don't know how to do it. If anybody who runs into pg eight door is listening to this podcast. [00:19:00] Speaker B: Yeah, JB's got a house for you. [00:19:02] Speaker A: We can talk offline. I know a guy. [00:19:04] Speaker B: Oh, great talk. [00:19:07] Speaker C: I'm not going to give him a. [00:19:08] Speaker A: Shameless plug on this pod, but I didn't know a guy. [00:19:10] Speaker C: Tell us about temporary storage exemptions. [00:19:13] Speaker A: Oh, yeah. Hey, Donnie, you want to talk a little bit about a temporary storage exemption and what it is? [00:19:17] Speaker D: Yeah. So a temporary storage exemption allows you to take possession in a state as long as that's not where it's going to be permanently. Illinois is a good example, believe it or not, of something that actually is good. Where they have a temporary storage exemption, you can have things brought into the state that just is there temporarily, hence the name. And you don't have to pay tax. And so it's not considered first use where you take possession in that state. So in a previous life, we used to buy POS systems, bring them into the state, load the software, and then send them out across the country. Well, when you bring them in and you load that software, that's first use. So you have to pay Georgia tax at whatever percent, and then wherever it's going, you should be paying the differential if that rate's higher. And so that's an administrative pain, and you're not really using it in Georgia, you're just making it more useful for someplace else. [00:20:10] Speaker A: That's exactly it. And we also had our auditors try to argue with us that certain things that were bought here from a marketing perspective and put into inventory were considered to be first use. And we were like, no, if you have to actually look, it's inventory. And it was inventory held for resale. And we'd have to sit here and talk to these guys and talk through it and show them that we're actually charging. Even though there wasn't an itemized charge for these particular things, it was included in a standard marketing fee or an MLM, a market level marketing fee or something else. And it was built to compensate for it. Auditors fuse blown. They're like, oh, I don't understand this. It's being held in a warehouse in Georgia. [00:20:47] Speaker C: What's temporary mean? [00:20:49] Speaker A: That's actually really, really good question. Some states define temporary as less than a year. Some states define it as less than 60 days. It could be your inventory turn ratio or something like that. It varies by state. [00:21:04] Speaker D: Yeah. It would have a statutory definition. [00:21:06] Speaker A: Would have a statutory definition. [00:21:07] Speaker C: Do each different. Different products have different definitions? [00:21:09] Speaker A: Or is it all just, you know what? For the most part, it's typically shown in their inventory definition, like, what's quantified as a. And qualifies as a withdrawal from inventory. And then they would give you the specific statute and the statutory guidelines of the time period that would go along with a withdrawal from inventory or what would typically be considered something that was temporarily stored. [00:21:31] Speaker C: It's just us in Illinois. [00:21:33] Speaker D: No, no. Illinois has a temporary storage exemption. Georgia doesn't. [00:21:36] Speaker A: Yeah, Georgia does not. Actually, there's. There's less states that have temporary storage exemptions than there are states that do have them. Right, right. [00:21:45] Speaker D: And it's not very often that Illinois gets to be a good example. So. [00:21:49] Speaker A: Yeah. [00:21:50] Speaker B: Giving them a shout out. [00:21:51] Speaker A: Yeah. So, like, Illinois one on New Jersey was one, which is always interesting because a lot of people. That's why so many warehouses and everything kind of exist in, like. And, you know, Newark and that whole area is that a lot of people move goods into New Jersey for, you know, temporary storage. Nevada has one. I know. I'm trying to think, who else is. [00:22:08] Speaker C: There any advantage to the state not doing, like, okay, so we do that. I mean, they must get some benefit. I mean, I guess people buy land and then they pay taxes on the land for a big warehouse. [00:22:18] Speaker A: Yeah. For, like, property taxes. [00:22:20] Speaker D: And you get payroll. I mean, if you have a warehouse, people who move all that stuff around. [00:22:23] Speaker C: It feels like everybody should have that. [00:22:26] Speaker B: I agree. Yeah. You think it would help with the free flow of goods and just manufacturing, people wanting to import and if you. [00:22:36] Speaker D: Have a purchasing function in your company where you buy things in bulk and then you send them out to wherever. You don't have to set up a separate legal entity to do the purchasing and then turn around, bill it intra company, that kind of thing. [00:22:47] Speaker A: And see everybody hypes on Georgia because they're like, oh, we got Savannah, the big port, and, oh, we offer free port exemptions for inventory and blah, blah, blah. Yeah, that's great and all, but the freeport, like, it started off as this really cool and huge and broad thing. But then Georgia started narrowing that definition over time, and counties started changing, you know, their enforcement of it and how they can apply, because they can. Counties can approve whatever they want from a freeport standpoint. Right. Like when you actually go through and you apply something on Freeport or apply for a free port exemption on property tax, and this is with property tax, by the way, it's completely at the discretion in some instances for the county to, to say what they're going to prove and what they don't. [00:23:23] Speaker B: Why is Georgia not cool about this? Like, why can't we have it? [00:23:26] Speaker A: You know what? It's a big money generator. Yeah. On the Freeport side, I mean, you can be talking millions and millions and millions of dollars. I could sit here and talk to you, you know, blue in the face and give you stories about craziness. I've seen on Freeport stuff. And one of the big pieces of language that's in the Freeport that a lot of people screw up is if you're bringing a bunch of items in and you're holding them in inventory, but then you're selling it to a retailer outside of the state. That was when it would qualify for a Freeport exemption because you're selling it to someone who's ultimately going to resell it again. But if you're selling it to an end consumer, if it goes to someone who's actually consuming it directly at the end of the, guess what? That inventory is not considered free portable. It's, it's basically inventory held for resale, and it needs to be reported. You have to pay tax on it. [00:24:11] Speaker C: They also look at numbers, too. I mean, I remember there was a whole thing on, like, the film industry in Georgia. And you look and they give us these tax breaks and that's what gets. [00:24:19] Speaker B: Movies to come here. [00:24:20] Speaker C: And it's like, oh, it's, you know, we'd make $3 billion if we just tax them like we tax everybody else. But you don't think about the other side, then they wouldn't come. [00:24:28] Speaker B: That's not the point. [00:24:28] Speaker C: And now you don't get zero of zero is zero. [00:24:32] Speaker B: Right. [00:24:32] Speaker C: And then you also all the money that goes into the economy and all the other things. But I think that's probably where this came from, is they were like, we can make money on this. Even if it doesn't really make any sense. It actually ends up probably hurting in the long run. [00:24:44] Speaker B: You know what else is zero? The taxability on the dollar tire for. [00:24:49] Speaker C: The tire disposal fee. [00:24:51] Speaker B: Disposal fee. So anyway, just bringing it back to the one I get. Right. [00:24:55] Speaker A: It's true. [00:24:57] Speaker B: Anyway. Okay. Anyways, Pam has had that expression a lot. Yeah. [00:25:01] Speaker A: I don't know why I've had this grumpy cat face today. So. All right, one of the other things we're going to talk about the expansion of digital goods. And Georgia just decided to create a foray, if you will, from a state perspective, into taxing digital goods. Right, Donna? [00:25:16] Speaker D: Yes. [00:25:17] Speaker B: Donna does not like this. [00:25:18] Speaker D: Donna's not happy about that. [00:25:19] Speaker B: Donna is not happy. [00:25:20] Speaker D: No. No, I'm not. So what Georgia did, effective January 1, is they made digital downloads of non software taxable. So AV books, music, games, movies, that kind of thing that you download and own now become taxable even though they're not tangible. And I get that if I buy a book, I pay tax. But if I buy a downloaded book now, I have to pay tax again. And this one hits me where I live because I'm a big reader. So this one costing me money. [00:25:50] Speaker B: I am, too. Not a fan. [00:25:52] Speaker D: Not a fan. [00:25:53] Speaker B: Yeah. I'm paying tax on my kindle when I buy it. [00:25:56] Speaker D: Right. [00:25:56] Speaker B: That's tangible personal property. And then my electronic book, I should not have to pay tax. [00:26:01] Speaker D: Exactly. [00:26:03] Speaker A: The thing is transfer of title, right? [00:26:05] Speaker D: Yes. [00:26:06] Speaker A: Yeah. [00:26:06] Speaker C: Because that's what they get. [00:26:07] Speaker A: That's what they get is a subscription. If it's a subscription model, you're not actually taking transfer of title. You're not owning something. They don't care. [00:26:14] Speaker B: Well, hold on. I lend a book to someone, though, and I'm not. Or give it to someone after I've read it. I'm not collecting tax and, or doing like a resale certificate. [00:26:22] Speaker A: So I don't know. Yeah. [00:26:25] Speaker B: Well, what I'm saying is the same. [00:26:27] Speaker A: Exact thing as a subscription based model, right? It's if you subscribe to Spotify, if you subscribe to Amazon prime and you're getting all this stuff downloaded for free, all that stuff's non taxable. But if you buy one of those movies and you download it and you own it permanently. It is now what? [00:26:43] Speaker D: It's now taxable. But here's my thing, too. Back to your point, too. If I have a book and I finish reading it, I can give it. [00:26:48] Speaker B: To you and you can read it. [00:26:49] Speaker D: Well, now I download a book and I can read it. I can't give it to anybody else. [00:26:52] Speaker B: Yes. [00:26:52] Speaker D: It's stuck right there in my Kindle or my nook. [00:26:55] Speaker A: Well, which is another reason that they say you have permanent title over it. Yes, but if I give it. [00:27:00] Speaker D: Give it to somebody else. [00:27:01] Speaker A: Big book lobby. [00:27:01] Speaker D: Right. [00:27:02] Speaker B: Where's the librarians? [00:27:03] Speaker D: Where are the librarians? [00:27:04] Speaker A: Where are the librarians? [00:27:05] Speaker B: Thanks a lot, Tim, for not being on our side with the books. [00:27:07] Speaker D: Right. That's cause Tim doesn't read. [00:27:11] Speaker B: That's why Tim's losing in the quiz. [00:27:13] Speaker A: Oh, my gosh. [00:27:14] Speaker C: Man, this is trash Tim day. I feel like I'm really supposed to be Switzerland here. [00:27:19] Speaker A: So I'm just trying to. Way to kick a guy when he's down. [00:27:21] Speaker C: He's very tired. [00:27:23] Speaker B: I checked the calendar. Oh, I love it. Donna, can you please be here every day? [00:27:27] Speaker A: No. [00:27:29] Speaker B: We love you, Tim. [00:27:30] Speaker A: All right, so other digital good things that George is looking at and what we're just hearing about this is that obviously they're looking at electronic delivery of software. Right. Which has always been a huge thing for the state and a big benefit for businesses. [00:27:44] Speaker D: Yes, they did talk about that at one point. It hasn't happened yet, but they've been talking about it for a while. And that would be, that would raise a lot of revenue. It would cost a lot of businesses a whole lot of money. [00:27:55] Speaker A: I would completely agree. [00:27:56] Speaker C: I'm trying to think. I mean, like, so every time I download, like, you know, Photoshop or a program, like, I mean, taxable. That's. It should. But that makes sense to me. Like the last time they looked at this law, I was like putting a disk in my computer and downloading software. Like, I would buy it and then I would install it. [00:28:12] Speaker D: That's right. [00:28:12] Speaker C: That's the last time they collect physical. [00:28:15] Speaker A: Exchange of tangible personal property. [00:28:17] Speaker D: Right. And so some of the things they consider tangible too, though, or if you back in the day, if you've got load and leave software and then they gave you a manual that manuals tangible property. Now it's taxable. But think about the companies that download like million dollars worth of software and how much that's going to cost them. [00:28:37] Speaker C: Sure. [00:28:38] Speaker D: Right. Whatever you budgeted for this year, add. [00:28:40] Speaker C: You know, 7% and everything's in subscription model now too. So it's like you download it and then you pay, you know, dollar 200 a year for this thing. [00:28:48] Speaker B: Right. [00:28:48] Speaker D: Well, software is a service not taxable in Georgia. Yet. Yet I think is the operative word. And I mean, look at your oracle subscription or whatever ERP system you're using and how much companies pay for that. [00:29:02] Speaker B: Yeah, it's big bucks. [00:29:03] Speaker D: Big bucks. [00:29:03] Speaker A: Absolutely. [00:29:04] Speaker C: So again, looking at the end and saying, here's how much money we could make. [00:29:07] Speaker D: Yes. [00:29:08] Speaker B: So, Donna, when you look in your crystal ball, you think that's coming up then? [00:29:11] Speaker D: I do. Yeah. [00:29:12] Speaker A: It's gonna be evaluated. Don't know if it's gonna be passed or not, but I can, I definitely agree with Donna. I think it's gonna have to be evaluated and the state's not already doing it. [00:29:19] Speaker D: Right. And I think maybe they'll phase it in, you know, make it 50% taxable up front or some percentage and then, you know, gradually increase that percentage. [00:29:29] Speaker A: Absolutely. And then, Donna, you had something, you had a funny story about the Georgia Dor website. I know Jenny is a big fan. [00:29:36] Speaker D: Yeah. So when Georgia. [00:29:38] Speaker B: I'm giving you a look now. [00:29:38] Speaker D: Yeah. [00:29:39] Speaker B: Right. [00:29:40] Speaker D: So when Georgia first went live with their Georgia tech center, I was doing compliance for a bunch of Georgia returns. Like hundreds of Georgia returns got into the website and all of the estimated taxes were not there. So you have to report the in, report the out. Not there. So it's a website. Right. I call up the Dor. You know, if you have any problems, call us at 1800, whatever we care. And so literally spent 8 hours on hold. I would have my little speakerphone on. I'd be eight. [00:30:15] Speaker C: Why? All day I would have hung up. [00:30:16] Speaker D: Because I had to file the returns, right. They were due. And so I finally get a hold of somebody in the taxpayer service center and like, I need to file returns. I don't see the estimated tax. She's like, oh, we know it's not there. Just go ahead and file. I'm like, you know, it's a website. Maybe you could post that. [00:30:34] Speaker A: Yeah. [00:30:35] Speaker B: Like a banner would be. [00:30:36] Speaker C: Don't worry about it. [00:30:37] Speaker A: Right. And this is your, this is for prepayments, right? [00:30:40] Speaker B: Yeah, yeah. That's a big deal. [00:30:41] Speaker D: And like it literally. Cause it. You have to report them. [00:30:46] Speaker A: This is what I don't understand. So you got a dude who's a developer and he's looking at a form over here and he goes, hey, all I got to do is recreate all these lines from this form, stuff it into the website. The prepayment lines on the form. [00:30:57] Speaker D: Well, yes, but if you know, it's not there, how about a banner? [00:31:01] Speaker A: Right? [00:31:01] Speaker D: Yeah, you know, we know this is not working. Keep going. [00:31:04] Speaker B: Because you don't want to trust, like, you know, they're not counting your prepayments and so therefore you're making a lower tax payment. But then they penalize you for whatever. Oh, you didn't put your prepayments in, right. [00:31:13] Speaker D: Oh, well, because that's what would happen. [00:31:15] Speaker B: Exactly. And it does happen. Not necessarily in Georgia, but many other states that's happened to us. [00:31:20] Speaker D: Our website's messed up. [00:31:22] Speaker B: It's our fault. [00:31:22] Speaker D: Sorry, but we're still going to charge you interest. Right. [00:31:25] Speaker C: We have to try to get somebody on the show who's made one of these or works on one or used to. [00:31:30] Speaker B: We've referenced it many times. [00:31:31] Speaker C: It has to be like somebody who just did websites in their life and like, oh, yeah, I worked on one of those. It is. And just give us some behind the scenes on what goes on there because I bet, I mean, I'm always usually on the side of like the creator, but I bet it wasn't all their fault. [00:31:46] Speaker A: Well, we're actually creating some stuff, so at some point you can sit down and talk with us. We can walk you through that entire development lifecycle. [00:31:53] Speaker C: Sweet. [00:31:54] Speaker B: Yeah. I'll just beat the dead horse with you. About the Georgia website. Georgia, if you're listening, it's really confusing for some people. When you file your return and make a payment and then you still say a payment is due and then you make another payment because you think, did I already make a payment? So again, just a quick fix, maybe a line of code. [00:32:12] Speaker A: Right, Tim, you know about this stuff, states be better. [00:32:15] Speaker B: Yes. [00:32:15] Speaker A: That's all we ask. [00:32:16] Speaker B: We have a coffee mug that says. [00:32:18] Speaker C: So now that Georgia's are saying, tim, you got anything you want them to fix real quick? [00:32:22] Speaker A: No, I mean, in all honesty, the upload process, what Jenny just talked about is one of the most ridiculous things. I mean, we've had to literally contact the state multiple occasions for people who are new to our process when we've actually, you know, tried to process returns and stuff and we've explained to them and say, hey, this is gonna be confusing when you get in here and you look at this. It's gonna be weird. Don't hit the payment button twice after you've already done the upload. And guess what? I accidentally made a payment. It's like, oh, my God. [00:32:48] Speaker B: Well, because they gave you a big scary message. [00:32:51] Speaker A: It's horrible. It's like, oh, my God, you must make a payment or your return. [00:32:54] Speaker B: So you think, oh my gosh, I must have just totally spaced out and, like, didn't make the payment. [00:32:58] Speaker A: And there's no way to confirm that you did, right. [00:33:00] Speaker B: Well, it's complicated, but it's very complicated. [00:33:03] Speaker A: So it usually involves, actually always involves a phone call. [00:33:05] Speaker B: Right? [00:33:06] Speaker A: Yeah. So we've got controls in place. We can manage all that now. It's great. But when we first started doing this many, many moons ago, it was one of those situations where like, this is the dumbest thing. And guess what? They still never updated the website. So. Yeah, I'm not. [00:33:16] Speaker B: And we're just trying to help you, Georgia. I mean, help your manpower, but only once. But also you don't have to handle all the phone calls and the emails of all the panicked people. Like some people at the. [00:33:26] Speaker C: I mean, I hate those big button things. I just did this. I tried to put an out of office on and it pops up that says, hey, you want to give this out of office to your people in your contact list? And you're like, yes. And when you click that, it sends your out of office to every unread email from everyone in your contact list forever. [00:33:44] Speaker D: Are you serious? [00:33:45] Speaker C: I sent some of the good people at Smith and Howard about 500 emails. I wonder why. [00:33:50] Speaker B: I got one from you. [00:33:51] Speaker D: They got two from you. [00:33:52] Speaker C: Oh, congratulations. You're on my friend contact list. [00:33:56] Speaker B: I was gonna say, I don't think I got one. That tells me something right there. You didn't read my email. [00:34:01] Speaker C: Yes. I put the preview is three lines long. So sometimes I'm like, I got it. I don't need to open it up. [00:34:07] Speaker B: I was thinking more. I wasn't on the friends of contacts list. [00:34:11] Speaker D: He just ignored my email. [00:34:13] Speaker A: That's exactly what that meant. That's exactly what that. [00:34:15] Speaker C: Donna, you got anything while George is listening? [00:34:18] Speaker D: No, I think we've covered most of it. I mean, really, just fix your website. [00:34:23] Speaker C: Before we wrap up. We only got a couple apologies. Disgusta. That one's on me. [00:34:28] Speaker A: Disgusta. [00:34:29] Speaker C: So many people called it that. I thought that was like just a thing. Everybody calls it disgusta. [00:34:34] Speaker B: I'd never heard of that. [00:34:35] Speaker A: That's actually the first time I've heard that. Did I? Wow. [00:34:37] Speaker D: I have heard that. [00:34:38] Speaker A: Okay. It's just. [00:34:39] Speaker C: I mean, not obviously the golf course. [00:34:40] Speaker A: Very beautiful. [00:34:40] Speaker C: Just the town around it is, you know. [00:34:42] Speaker B: Okay. [00:34:42] Speaker A: There's some nicer parts to Augusta. [00:34:44] Speaker B: Is it disgusting? Is it? [00:34:45] Speaker A: No, it's actually. It's pretty awesome. [00:34:48] Speaker B: Okay. [00:34:48] Speaker A: There's some pretty cool parts of it. [00:34:49] Speaker C: Illinois. Cause, you know, we infer that they only do one thing well, but we. [00:34:55] Speaker D: Gave them the one thing. [00:34:56] Speaker C: I know, but there's a lot of things you can do. I think about it. What a state does on a day to day basis. Here's the one thing. [00:35:02] Speaker A: Here's the one thing. It's like. It's like Curly. It's just one thing. [00:35:08] Speaker C: And Tim, for saying that he doesn't read because there's a slight inference that he couldn't if he wanted to. [00:35:17] Speaker B: Did he say that? [00:35:18] Speaker C: I know. Just. That's why you gotta apologize to Tim. [00:35:21] Speaker B: Yeah. Donna, do we need to apologize to Tim? We were sorry. [00:35:24] Speaker D: I inferred that you couldn't read. [00:35:25] Speaker A: I got thick skin. I'm good. [00:35:29] Speaker C: Okay, Jenny, take us home. [00:35:31] Speaker B: That was fun today. Thank you so much, Donna McMurray, for being on the podcast once again. You're always a favorite. Can't wait to have you on again soon. Just a reminder to everyone out there. You can listen to our episodes in any order. And what else? You can also email us if you have any haikus, any feedback. Like I always say, any complaints about tims, send them to taxingpoeticinexistax.com. And you can listen to us anywhere where you download your podcast, like on Apple or Spotify. [00:35:58] Speaker C: And you won't pay tax because it's non transferable property. [00:36:03] Speaker B: Is that true? [00:36:04] Speaker A: If you're not downloading it, you download it forever. Oh, but you're actually. You're not paying for it. [00:36:08] Speaker C: But you don't pay for it because. [00:36:09] Speaker B: Of the subscription, so you will not pay taxes. I'm just going to say that right now. And if that's wrong, then call Tim. [00:36:15] Speaker D: So. [00:36:15] Speaker B: All right, thanks, everyone, for being with us today. Have a great one. [00:36:18] Speaker A: Georgia's on your mind.