News You Can Use—Holiday Tax Tips

Temporary Sales Tax Permits

Selling photos with Santa this holiday season? Then you need a temporary seller’s permit. California requires sellers who intend to make sales for a temporary period of 90 days or less to obtain a temporary seller’s permit to report their sales and pay appropriate sales tax to the Board of Equalization (BOE). This applies to seasonal holiday businesses, such as Christmas tree lots and photos with Santa. If your sales period will last more than 90 days, you are required to obtain a standard seller’s permit. You can apply for a seller’s permit through the BOE’s eReg system. Please protect your seasonal business by ensuring your full compliance with the state’s sales tax laws.

Use Tax

If you purchase gifts for this holiday season, please remember you must pay use tax when you purchase physical merchandise from a mail order catalog, online retailer, TV shopping network, or other retailer who does not collect California tax. Generally, use tax is owed if the out-of-state seller did not collect the tax that would apply to merchandise sold in California. Use tax does not apply to sales of items specifically exempted from sales tax, such as prescription medicine and most food items. Use tax for personal items can be declared on your income tax return. Businesses have a number of options for payment. Visit BOE’s website for more information about use tax.

Charitable Deductions

If you will be making any charitable contributions this holiday season, remember to keep records of all your donations. You can report itemized deductions on your tax returns for contributions to a qualifying organization. All cash contributions require either a bank statement, receipt from the charity, or a payroll deduction record. Cash donations of $250 or more require a written acknowledgement from the charity. You may be able to deduct noncash donations, such as clothing, household items, vehicles, works of art, and more. Please consult IRS Publication 526, Charitable Contributions for more information.

Boost Your Retirement Account Contributions

If you have a retirement plan, now is the perfect time to boost your contributions for 2013. For an IRA account, the contribution limit for 2013 is $5,500, or $6,500 if you are over 50 years old. Contributions made between January 1, 2014, and April 15, 2014, may still be counted as contributions on your 2013 tax return, but you must designate the applicable year for the contribution on your tax return. Please consult Franchise Tax Board Publication 1005, Pension and Annuity Guidelines for contribution and distribution limits and rules for various types of retirement accounts.

District Offices

Culver City
5901 Green Valley Circle
Suite 200, 90230-6948
(PO Box 3652, 90231-3652)
Phone: 310-342-1000
Fax: 310-342-1061
12440 E. Imperial Highway
Suite 200, 90650-8397
(PO Box 409, 90651-0409)
Phone: 562-466-1694
Fax: 562-466-1598
Van Nuys
15350 Sherman Way
Suite 250, 91406-4203
(PO Box 7735, 91409-7735)
Phone: 818-904-2300
Fax: 818-901-5252
West Covina
1521 West Cameron Ave.
Suite 300, 91790-2738
(PO Box 1500, 91793-1500)
Phone: 626-480-7200