CHARLESTON, SC (WCSC) - Online shoppers don't be caught off guard this year when filing your tax return. The state wants its share of taxes on your online and out of state purchases.
"I actually personally received a letter, both this year and last year to report my online purchases from Amazon," said Beth Parrott Customer Service Leader for H&R Block.
When filing a tax return, online shoppers in South Carolina are expected to pay taxes on all purchases to the state department of revenue. This is a called a use tax.
Parrott said, "The use tax is a tax that's very similar to the sales tax."
Sales tax is a tax on items you purchase inside South Carolina and use in the state.
"So its for retail purchases," said Parrott.
When you purchase items outside the state, whether its online or not, this is when the use tax is applied. Its a 6 percent tax.
"I bought a computer over the internet this year," Parrott said, "I'm going to report that on my South Carolina tax and i'm going to pay the use tax because i'm using it in South Carolina."
The tax helps to level the playing field between outside retailers and businesses that are actually in-state.
"The South Carolina law is very clear. If you paid it and you have a receipt that shows you paid it, you don't owe it again. If you bought it from company that doesn't have a store in South Carolina and you didn't pay tax or paid a 2 or 3 percent tax that's less than South Carolina's tax, you owe the difference," said Parrott.
Some tax payers don't keep track of their out of state or online purchases but there's an easy solution to that problem.
Parrott said, "My envelope is the place where everything goes that I am going to need to know. So when you order something on the internet, print out the form, put it in your envelope and be ready at end of the season. Then you could tally those up and you know what your internet purchases add up to."
The Department of Revenue expects all state taxpayers to make a good faith effort to report all use tax purchases.
"That would be my advice as a tax preparer that you do the right thing and you fess up to what you bought. Try to keep track of what you've been buying on the internet and pay it as part of your South Carolina tax return," said Parrott.
The use tax can be filed on the South Carolina 1040, the individual income tax return or on the UT3 form where the use tax could be sent to the Department of Revenue throughout the year.
Purchases made during tax free weekend are not to be included in use taxes.
The deadline to submit your state tax return has been moved to April 17th because of holiday observations.