Jewish World Review Feb. 13, 2001 / 20 Shevat, 5761
Must I charge tax? Can dotted property line stop us from building on our land?
DEAR BRUCE: I have been picking up some spare money on the weekends at a local flea market. I buy stuff here and there, then on the weekends I rent a table, put the stuff out on the table and sell it for a little bit of a profit. The big difference between the flea market and regular stores is that they charge sales tax and we don't. Last week some inspector from the tax division came through the flea market and scared the heck out of most of us. They told us that they were not going to arrest anyone that week but anyone who didn't have a sales tax number next week would not be allowed to operate. If they make us charge tax we have no advantage. -- T.D., via e-mail
DEAR T.D.: Welcome to the real world. These folks don't "charge" sales tax, they "collect" sales tax, as proscribed by the statute in your state. They don't have any choice in the matter, nor do you. Yes, you have a clear, unfair advantage if you don't collect the tax as the law requires, but that is hardly fair to those people who follow the law. Many folks in the weekend flea markets ignore that, but in some cases it is to their sorrow -- the penalties can be severe.
DEAR BRUCE: Last week we were supposed to close on our new home. The house was built in a subdivision, and our developer was the only builder on the various sites. At the walk-through it was casually mentioned that there was a sewer easement directly in back of the home. It shouldn't cause us any difficulties, but if the pipe were ever to break then the government authorities who operate the sewer system would have the right to come onto our property with a backhoe and start digging. No one ever mentioned this to us, and it only came up because I looked at a copy of the survey and saw a couple of dotted lines across the back yard.
We refused to close until we get this sorted out. My lawyer said they had an obligation to tell us, but at this point the only thing that we can do is to ask for our money back. We really like the house. We wonder what you would do in this circumstance. We have to act quickly. -- D.E., via e-mail
DEAR D.E.: You are correct in having an attorney represent you, and you are correct in that they did have an obligation to tell you. However, having said that, if you want this particular house, you are stuck with this situation.
If the dotted property line is in a place where there would be absolutely no chance of your building an addition to the house or a garage, I don't think that this is too troublesome. Pipes very rarely have to be dug up, and if it does happen, the sewer people have an obligation to restore your property to its previous condition. This would not stop me from purchasing a home that was otherwise satisfactory.
If, however, the dotted property line is in a place where it would preclude any legal additions to the home, I would have to think this one over very carefully and perhaps ask for a different home or a price concession.
DEAR BRUCE: I am in line to receive an inheritance in the amount of $300,000. Of this amount, $170,000 will be in Certificates of Deposit, and $130,000 will be in property. What can I do to avoid or lower the taxes that will come with this inheritance? -- M.K., Cincinnati
DEAR M.K.: Good news -- there are no taxes to be paid! Any taxes on the inheritance will be paid by the estate of the decedent. The principle amounts are totally yours without tax. If these funds earn money while they are yours, however, they will be
Send your questions to JWR contributor Bruce Williams by clicking here. (Questions of general interest will be answered in future columns. Owing to the volume of mail, personal replies cannot be provided.) Interested in buying or selling a house? Let Bruce Williams' "House Smart" be your guide. (Sales of the book help fund JWR).
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02/02/01: Life insurance for regular people?
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